Firm goes to court over Msunduzi’s decision to cancel contract

2015-11-20 10:00
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Pietermaritzburg - Engineering company Zama Traffic Signals CC is taking Msunduzi Municipality to court to set aside a decision to cancel its contract.

Zama Traffic Signals CC also wants the court to order the municipality to pay it R1 076 846, which it alleged is still owed for work it has already done.

According to their website, the company is a “100% black-owned and managed enterprise, established in February 2005 as an electrical engineering company” that offers services including electrification, MV & LV cable fault location, traffic signals design, installation, maintenance and back-up power solutions and also “covers a wide spectrum in the construction industry”.

The case came before the high court briefly this week but was adjourned for an indefinite period without any order being made.

So far the municipality has not yet filed any papers.

According to an affidavit by Zamile Bovungama, the sole member of Zama Traffic Signals CC, the company has rendered services to Msunduzi since October 2013. He said he believes his company has provided Msunduzi with “excellent service”, which was demonstrated by the fact that the municipality had engaged it on a regular basis and also issued them with a reference letter when submitting other tenders.

Bovungama said to his “alarm and dismay” a letter was received from Msunduzi on August 4 cancelling their contract, allegedly due to allegations that an internal audit had uncovered fraud.

It was alleged that Zama Traffic Signals CC had submitted invoices for work performed and completed when this wasn’t the case and had also allegedly inflated invoices.

The company was ordered to remove all its equipment and staff from all Msunduzi sites by noon on August 7.

Bovungama said the municipality has failed to supply details of the alleged fraudulent conduct or allow his company to make representations or offer explanations. The allegations are “vague and devoid of detail,” he said.

He maintained in this regard that proper procedures to deal with the matter were not followed.

He also stated that on September 9 (after cancelling the disputed contract), Msunduzi accepted another tender from Zama Traffic Signals CC. If Msunduzi legitimately believed that the company had acted illegally then it would not have awarded it a further contract, he said.

Read more on:    pietermaritzburg  |  court

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