RUNDU – Court mediation has culminated in the Rundu Town Council reaching a settlement with property developer Armstrong Construction to cancel a soured PPP deal that would have resulted in the developer constructing 600 residential houses to alleviate the housing shortage at the river town.
“Having read the pleadings and other documents filed on record for HC-MD-CIV-CON-2018/00777, the court order issued out of this court on 03 September 2018 is, in terms of Rule 103 (1) varied to read as indicated below,” read the court order seen by this reporter.
“It is hereby ordered that the settlement agreement is hereby made an order of court. The case is postponed to 27 November at 08:00 for status hearing (Reason: To record the outcome of clauses 2.3 and 2.4 of the settlement agreement dated 24 August 2018 and to determine the way forward in the event that the undertakings as per the mentioned clauses are not finalized) by order of court.”
“We are no longer partners, a settlement agreement was reached maybe two weeks before I came on board, yes N$18 per square metre of developer per land has been agreed, they will have to take care of the development by themselves, obviously at that reduced rate they should be much more empowered, they should have more space to flex their muscles,” confirmed the acting CEO Sikongo Haihambo.
“Currently as we speak we have set ourselves activities for implementation from their side as well as our side which we see as achievable from both sides. There have been a number of direct correspondences with their lawyer and their management and we are moving along,” he stated.
The dispute between the two started when council through its lawyers told Armstrong Properties that they should forget the PPP agreement and rather buy the land at N$25 per square metre or give it back to the town council.
But Armstrong turned down the price and decided to give back the land only on condition the town council pays the cost that they had spent on servicing the 600 plots, which led to the developer dragging the town council to court over the botched property deal.
“I don’t think one would call it that a single party may have won because that is not the spirit of a settlement, settlement agreement is a process of giving and taking, somehow you move from your original position to another where you have accommodated the other party and vice versa,” Haihambo noted.
“Before going to the High Court we were given an option of mediation to see if we can resolve it ourselves with our lawyers. The court appointed a mediator and during mediation the council proposed that Armstrong pay N$50 per square metre per individual erf and then we terminate the partnership and we said we wasted a lot of time, we lost clients in the process, we serviced the land and at the end of the day we settled for N$18 per square metre,” Armstrong representative, Ferdinand Olavi, told New Era on Monday.
“And after settling it was made a court order, so now some of the conditions are that council before end of November registers the land as theirs as it currently belongs to the state and then transfer it to Armstrong and we make the payment and we start with construction and they must approve our erven as soon as it is registered. There’s no longer a partnership between us, we are now going to take it on as a private developer,” Olavi noted.
The council’s contribution to the project was to avail virgin land, while Armstrong Properties was to service the land and construct houses. “As far as I’m concerned we would want to see the success of any project that is going to improve the lives of our people – a number of initiatives around town obviously if we can push them, if we can help them realise what they were intended for then it’s going to be good because to develop a town doesn’t only depend on the town council, it depends on the investors too,” the acting CEO further stated.