The Tsumeb municipality has been ordered to pay an outstanding amount of N$3.72 million to Enviro-Fill Namibia (EFN), a company that was contracted to provide waste management services to the local authority between 2009 and 2014. The court also dismissed the municipality’s counter-claim of N$9.4 million, which asserted it had suffered losses after seeking an alternative service provider, following the alleged fallout between the two parties. The municipality was dragged to court following a payment debacle after it failed to settle invoices brought forward by EFN on time. Thereafter, it claimed that the company breached its contractual obligation after refusing to render services from 7 August 2013 to August 2014.
In a judgement delivered on 22 April in the High Court, Judge Nate Ndauendapo ordered the Tsumeb municipality to pay N$3 725 402.82 owed to Enviro-Fill Namibia for services rendered between August 2013 to August 2014, with a 20% interest per annum until the last date of the final payment.
The municipality was further ordered to bear the legal expenses.
EFN had written to the municipality on 2 August, demanding payment, and threatened to stop rendering services if no payment was settled by 6 August. Despite the threats, EFN continued to provide the services unhindered, the court found, even though no payment was received.
Regardless of the ultimatum, payment was not done. Instead, the municipality on 13 August wrote to the company to inform them that they had breached the contract after allegedly not having rendered the required services.
EFN on 14 August responded, suggesting other means on how the contract could be revived and carried forward, while in a way seemingly agreeing to the municipality’s decision of terminating the contract. However, the court found that it [EFN] continued to provide services, irrespective of the threats.
The judgement further states that the municipality sought other alternatives and started using other service providers, who then charged them N$9 497 250.39, doubling the N$4 118 826.82 which was initially supposed to be paid to EFN had it provided the service. The defendant claimed had EFN not unlawfully and unilaterally repudiated the agreement, it would not have sought alternative service providers after it [municipality] was only given a four-day notice. The court was, however, not convinced by such assertion, citing lack of evidence.
The court also found that the municipality failed to provide evidence that it had incurred losses. In September, the town council used employees of EFN to carry out the work, claiming that it was a private agreement that did not include EFN, as by then the two had parted ways. The court also asked why the municipality failed to question EFN, as it kept issuing monthly invoices.
EFN was awarded a contract in 2009 to clean up and manage the landfill site, door-to-door and bulk waste removal, street and toilet cleaning services, the recycling of domestic waste as well as training.