Ruling to dissolve Matshelagabedi plant partnership upheld

The Court of Appeal has upheld a High Court ruling dissolving the partnership of the two sub-contractors that built the 70-megawatt (MW) power station in Matshelagabedi.

The companies, Runicta Engineering and Garrick Operations, appeared before the Court of Appeal as a result of an appeal made by Garrick Operations requesting that the High Court ruling be overturned.

The High Court had ordered that the partnership between the contractors should be dissolved and that the profits of the partnership and the assets of the partnership be shared between the partners equally.

The dispute arose out of a project for Alstom Power Rentals (APR) Energy, which was carried out between September 2009 and January 2010 for the installation of a 70MW power plant located in Matshelagabedi, some 30 kilometres from Francistown. Runicta asserted that although the two contractors were both involved in the execution of the project as equal partners, Garrick was non-committal.

Runicta then sued Garrick for an order dissolving the partnership and for an equal division of the profits and assets of the partnership between the partners. It was also established that certain monies were also claimed to be owed by Garrick to Runicta from the venture.

After a full trial, the High Court delivered judgement in favour of Runicta Engineering ordering that the partnership between Runicta Engineering and Garrick Operations should be dissolved and that the profits of the partnership and the assets of the partnership should be shared between the partners equally.

Dissatisfied with the ruling, Garrick Operations appealed the ruling, questioning whether the High Court was correct in its findings that there was a partnership between it and Runicta Engineering, and if so, whether the profits and assets of the partnership stood to be shared equally between the partners.

Garrick argued that the trial court erred in its findings and the resultant orders it issued.

Delivering judgement last week, Judge Isaac Lesetedi stated that in its appeal, Garrick did not dispute the existence of the partnership nor the agreement. “It merely explained that it was still in the process of carrying out its obligations under the memorandum of agreement signed by the parties,” he said.

He indicated that Runicta’s evidence which was not seriously controverted and which in any event was found by the High Court to be credible, clearly demonstrates that Runicta contributed material and services to the project at the commencement of the partnership.

“The parties did not have the necessary funds for the initial capital which was contemplated and the initial capital for the project was injected by the client (APR Energy),” said the judge.

He went on to explain that the evidence also shows that Garrick itself only had a skeleton workforce made up of appellant’s managing director and his secretary while Runicta did not only contribute services, but also materials at the commencement of the project.

He said the High Court found the evidence given on behalf of the respondent credible and rejected that given by the appellant’s managing director whom it found unreliable.

The judge said these were credible findings, which “were clearly justifiable on the evidence and probabilities.” “There is no reason to interfere with those findings,” said judge Lesetedi.

He therefore noted that the appeal is without merit and that it should be dismissed with costs.

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