News / National
NOIC suffers blow in US$160,000 arbitration award
28 May 2024 at 04:55hrs | Views
The High Court has ruled in favor of the contractor in a dispute with the National Oil Infrastructure Company of Zimbabwe (NOIC) overpayment for supplying and installing instrumentation, control, and electrical equipment for the Mabvuku Ethanol Storage Tanks Project.
The court ordered NOIC to pay US$164,631, following its initial refusal to honor the arbitration award. NOIC had attempted to block payment to AC Controls Company, insisting on settling the debt using a 1:1 exchange rate between US dollars and the Zimbabwean dollar.
In response to NOIC's application to halt payment, citing AC Controls and retired High Court judge Justice November Mtshiya (who awarded the arbitration) as respondents, the court found that AC Controls had fulfilled its obligations under the contract. The agreement stipulated payment for materials upon submission of invoices, valuation reports, and interim certificates.
Despite amendments to the contract reflecting changes in the country's monetary policy, AC Controls had procured materials worth US$164,631.34 before the amendments took effect. NOIC resisted payment, arguing that without an interim payment certificate, the amount could only be settled at a 1:1 exchange rate.
The dispute was referred to arbitration, where Justice Mtshiya ruled in favor of AC Controls, upholding their claim for payment.
Justice Webster Chinamora, presiding over the case, dismissed NOIC's application to set aside the arbitral award. He noted that the parties had willingly entered into and amended the contract to account for foreign debts, concluding that the award was valid and should be enforced.
The court ordered NOIC to pay US$164,631, following its initial refusal to honor the arbitration award. NOIC had attempted to block payment to AC Controls Company, insisting on settling the debt using a 1:1 exchange rate between US dollars and the Zimbabwean dollar.
In response to NOIC's application to halt payment, citing AC Controls and retired High Court judge Justice November Mtshiya (who awarded the arbitration) as respondents, the court found that AC Controls had fulfilled its obligations under the contract. The agreement stipulated payment for materials upon submission of invoices, valuation reports, and interim certificates.
Despite amendments to the contract reflecting changes in the country's monetary policy, AC Controls had procured materials worth US$164,631.34 before the amendments took effect. NOIC resisted payment, arguing that without an interim payment certificate, the amount could only be settled at a 1:1 exchange rate.
The dispute was referred to arbitration, where Justice Mtshiya ruled in favor of AC Controls, upholding their claim for payment.
Justice Webster Chinamora, presiding over the case, dismissed NOIC's application to set aside the arbitral award. He noted that the parties had willingly entered into and amended the contract to account for foreign debts, concluding that the award was valid and should be enforced.
Source - newsday
