Fight over contract payment.

FamCast News
a month ago


Tempers flared yesterday during a heated meeting between two Unik Construction Engineering (PTY) Ltd and Basotho Water Holdings (PTY) Ltd officials over payment for work on the multi-million maloti Ha Belo Industrial Estate project in Botha Bothe.

Basotho Water Holdings (PTY) Ltd managing director Tṥeliso Thamae claims Unik Construction owes his company M918K for work on the project, which the latter disputes.

Thamae had been summoned to the meeting by Shoudao Zhao, who is the tender manager at Unik Construction, in a bid to resolve the impasse.

However, the meeting – which was chaired by the company’s second in charge senior construction manager, Nicholas Charles, and attended by this reporter – soon turned into a nasty verbal fight, with each side challenging the other to provide proof that it was in the clear and did not owe anything.

Thamae, who is also the president of the Association of Contractors in Lesotho, challenged the Unik Construction officials to provide proof that the company does not owe Basotho Water Holdings any money.

“I just need a letter from Unik Construction that says it does not owe me anything, and I will leave,” he said.

Thamae also boasted of being friends with prime minister Sam Matekane, saying the premier had advised him to take the matter to parliament.

“I worked with him (Matekane) in the construction industry. He advised me to take the matter to parliament,” he noted.

“And as a matter of fact, I will deport every Chinese because they do not pay Basotho.

“I will make sure that all your projects in Leribe and Maputsoe come to a halt,” Thamae added.

“You want to settle this matter amicably, but you are not conducting yourself that way,” Charles said in response, referring to Thamae’s decision to take the case to parliament’s economic cluster committee on February 28 this year.

“All I want is proof. I want a reconciliation of the documents then I will deal with the matter in my own time because I have a lot on my table,” he said.

He added: “If you keep speaking negative about Unik Construction everywhere, you’ll pay.”

In the midst of this debacle, Zhao chipped in, telling this reporter: “If you do not report the truth, I will show you.” He did not specify what he meant.

A number of Basotho subcontractors are embroiled in a contractual dispute with the Chinese-owned company, which they accuse of not honouring its commitment to pay them for work done at the Ha Belo Industrial Estate Botha Bothe district.

The construction of the M900 million Ha Belo Industrial Estate commenced in January 2018, and Unik was appointed by investment promotion agency, Lesotho National Development Corporation (LNDC), as the principal contractor.

This after the company had won the tender for construction of 16 factory shells.

The net effect of this non-payment is that it has caused grievous financial harm to the Basotho-owned businesses, leaving most on the brink of bankruptcy.

TheReporter has learnt that Basotho sub-contractors were allocated 30 percent of the M900 million project. Basotho Water Holding (PTY) Ltd is among the aggrieved local companies.

Thamae said in a previous interview this week that his firm is owed M918K after it was issued with a certificate of completion on October 27 2022.  An additional 10 per cent retention per annum is also due to Basotho Water Holding (PTY) Ltd, he claimed.

This amount is for works pertaining to the factory shell called M10-2. According to a signed contract dated November 10, 2018, the works entailed carpentry, joinery, ceilings, partitions, floor covering, wall linings, ironmongery, metal work, plastering, tiling, plumbing, and drainage works.

Thamae said they had completed the subcontracted work despite numerous hurdles caused by Unik, which included delays of payment and theft of equipment.

He claimed that the company declined to pay him that outstanding balance.

Frustrated by this, Basotho Water Holdings wrote to Unik Construction on October 20, 2020 seeking an immediate resolve on contractual issues between the two parties.

“We require a full and complete subcontract agreement to be signed by both parties. In 2018, Basotho Water Holdings were given only a Bill of Quantities (BOQ) to sign as their Sub-Contract Agreement.

“We require escalation of 20 percent on the agreed rates, because the above mentioned BOQ was issued to us in 2018 and the works only commenced in 2020. And as such, in order to cater for price increases in materials and labour, we require an adjustment of 20 percent to our rates across all the BOQ items,” the letter noted.

Basotho Water Holdings also highlighted that there was need to formally agree on rates for UNIK’s supply of materials and labour before any deduction is done in the former’s payment certificate.

After failing to get a favourable response from Unik Construction, Thamae’s lawyer, Advocate Sello Tṥabeha, on September 26 2022 wrote a letter to the chief executive officer of Lesotho National Development Corporation (LNDC) (Molise Ramaili) explaining that his client Basotho Water Holdings has since completed its works on the project.

“On April 14, 2022, we presented a letter of demand to UNIK for payment of the outstanding payment in the above project.

“To date, UNIK construction has not paid (our) client. Instead, whenever client makes a follow up on the issue, he is told to withdraw a case against them which is totally unacceptable because in the first place there is no pending case anywhere,” the letter read.

On October 5, 2022, Adv Tṥabeha wrote again to Unik Construction showing notice of intention to commence arbitration proceedings.

It read: “Pursuant to Clause 21 of the Sub-contract agreement, we intend to commence arbitration proceedings on behalf of client in respect of the outstanding claim as fully reflected in our letter dated April 14, 2022.

“This is more so because despite several follow ups and lawful demands, the claim remains unpaid to date.

“Therefore, if the claim would not have been paid by October 10, 2022, we shall approach the Law Society for appointment of an arbitrator in this matter.”

On December 1, 2022 Tṥabeha requested the appointment of an arbitrator in a letter written to the Law Society of Lesotho explaining that a dispute had since been declared and parties were to submit for arbitration in terms of their contract, with the arbitrator to be appointed by the Society.  The letter was received by the Society on December 2, 2022.

Still not finding joy, Thamae recently wrote to the parliament’s economic cluster committee seeking its intervention.

Committee chairperson Sello Hakane, last week said they were still looking into Basotho Water Holdings’ case.

He explained that the committee had in a previous meeting asked Thamae to submit documents to prove that he had done the job and that he had received a certificate of completion.

“We’ll call another meeting where Thamae will produce relevant documents needed by the committee, then give a ruling on the way forward,” Hakane explained.