SIU withdraws bid to freeze Beitbridge contractors' bank accounts, but stops further payments
The Special Tribunal on Friday made an order granting the Special Investigating Unit (SIU) permission to institute proceedings against two contractors that were allegedly unlawfully appointed as part of the controversial R40.4m Beitbridge border fence contract.
The order was granted by agreement between the parties: the SIU, two contractors — Caledon River Properties and Profteam — and the department of public works.
The SIU had approached the Special Tribunal on an urgent basis last week to freeze the bank accounts of the two contractors, to which the public works department had paid R21.8m.
It is alleged the R21.8m was paid before the construction work commenced.
The SIU claims the department — using emergency procurement processes to address, prevent and combat the spread of Covid-19 — unlawfully appointed the contractors to erect and repair the border fence at the Beitbridge border post.
The SIU alleges the procurement process was not done in accordance with the law.
It also sought to interdict the department from making further payments in relation to the project, pending the finalisation of the main action to be taken by the SIU against those involved in irregularities.
After the negotiations between the parties, the SIU agreed to withdraw an application for the freezing of the bank accounts of the two contractors. The withdrawal was made an order of the court.
The tribunal on Friday also granted an order permitting the SIU or the department to institute proceedings against the contractors within 20 days of Friday's order.
It also ordered that pending the institution of proceedings on the merits, the two companies shall not make any claims for payment and the department shall not pay any amounts emanating from the fence contract.
The order said if the SIU or the department failed to institute proceedings against the contractors, the companies may immediately proceed to enforce their rights under the contract.
In terms of the order, the contractors — without any admission of any wrongdoing — undertook to pay any amount ordered against them by the tribunal or the court.
Judge of the tribunal Lebogang Modiba granted the order.
“I am satisfied that the order makes provision for the parties to respect the integrity of the intended further legal proceedings without encroaching on the rights of any party,” Modiba said.
The SIU welcomed the order and said the parties agreed the matter required urgent hearing of the merits to bring finality to the matter.
“The withdrawal is a result of an agreement between the parties not to proceed with part A of the matter and deal with part B directly. Part B deals with the merits of the case while part A was only dealing with the freezing of accounts,” the SIU said in a statement.
The SIU said by bringing this application, it had succeeded in stopping the remaining payment of about R19m by the department to the contractors.
The SIU said the undertaking by the contractors, that they will pay any amount ordered against them by the tribunal, gave it comfort that the subsequent judgment will be satisfied.