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Supreme Court rules that ZPC and Chivhayo remain i...
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Supreme Court rules that ZPC and Chivhayo remain in contract to install 100 MW solar plant

Nyasha Ndoro

Zimbabwe Power company and Wicknell Chivhayo’s Intratek  will have to install the 100MW Gwanda Solar Project after the Supreme Court of Zimbabwe threw out an appeal by ZPC against a High Court decision which found that the contract for the development of the was still valid.

“Considering that the Supreme Court is the final Court of Appeal in this instance, the legal implication of today’s judgment is that ZPC and Intratrek will revert to the position that they were before the 23rd April 2018,” said ZPC lawyers Muvingi and Mugadza in an explanatory communication to the power company.

Effectively the EPC Contract signed between ZPC and Intratrek on 23 October 2015 remains valid and both parties have to honour their contractual obligations.

Speaking after the Supreme Court ruling. Chivayo’s lawyer, Advocate Lewis Uriri, said that Intratek will have to honour its part of the contract.

“What this means is that, the Gwanda Solar Project will have to go on and Intratrek will have to undertake that work,” he said.

Legal experts told Zim Now that Chivhayo’s US$22m lawsuit for expenses incurred falls off as contract has been reinstated.

ZPC cancelled the contract on April 23, 2018.

The December 1 ruling by the Supreme Court upholds the High Court ruling in January that found in Intratek’s favour that the contract was still valid.

ZPC’s appeal was dismissed after a hearing before Honorable Justices Chiweshe, Makoni and Musakwa. No damages have been awarded in the ruling.

The full written judgement containing reasons for the Court’s determination are yet to be furnished.

In a statement ZPC said it in the matter of public interest it should be noted that Intratrek is still required to satisfy all conditions precedent to the commencement of the project, which it had failed to achieve as at 23 April 2018.

“In abiding with the Supreme Court judgement, Intratrek is now required under the reinstated EPC Contract to facilitate the financing of the US$172 million contract within the contractual timeframe as the requirement of financial closure is key for the project to commence. Should such financing be raised, the borrowing instruments must be approved by Government prior to implementation of the Project,” said ZPC in a statement.

In 2014, Intratrek was awarded a tender to construct a 100-megawatt solar plant in Gwanda. But ZPC later on backtracked on the deal and sued Intratrek and its managing director, Chivayo for fraud involving misappropriation of US$5.6 million.

 

 

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