HARARE – Parirenyatwa Group of Hospitals has escaped a lawsuit which saw a private security company go to court to demand payment of US$261,430 being outstanding fees for services rendered to the government health institution following a contact entered into by the parties back in 2010.
Crush Security Pvt Limited, the plaintiff in the case, is also seeking five percent interest on the amount calculated from October 1, 2011.
According to court papers, in September 2010, the plaintiff and defendant penned a contract in which Crush Security was going to provide security services at a fee of US$23,554.30 per month.
The contract, signed in terms of the Private Investigators and Security (Control) Act, was entered into pursuant to a tender process.
In November 2010, while parties discharged their obligations in accordance with the dictates of the contract, there was the promulgation of Private Investigators & Security Guards (General) Amendment Regulations, 2010 (No. 1) S.1. 180/2010 which increased the tariffs for Security Guards which were in S.I. 156 of 2007.
As a result of the increase in tariffs, the fees for the services rendered by the plaintiff increased form US$23,554.30 to US$50,551.70 per month.
The government health institution was accordingly notified of the variations in tariffs, something that led to a series of meetings between parties to deliberate on the emerging situation.
Parirenyatwa Hospital then sought guidance from the Procurement Board on whether to terminate the contract or vary it.
However, the Procurement Board failed to advise the hospital on any of the solicited choices.
“During that period, the plaintiff kept on offering services and being paid US$23,554.30 and kept on debating the defendant for the outstanding amount to make it US$50,551.70 as per the new tariffs and legislation,” read court papers.
Termination was then done in September 2011.
Court heard at the time of termination, the Procurement Board had not authorised the hospital to vary the contract.
The security company then claimed the difference between the amount paid (in terms of the contract) and the then gazetted fee in terms of S.I. 180/2010 which totals to US$261,430.
The company however lost the bid to recover the money after High Court judge, Chinamhora ruled it could not try to get paid for what was outside the parties’ signed contract.
“The proposed midstream change was clearly unsustainable, because the plaintiff was trying to seduce the defendant to provide it with money which was not part of the contract agreement.
“In my view, it gets worse when one considers that the proposed changes were never reduced to writing as directed by parties’ agreement. The plaintiff cannot unilaterally change the contract,” said Chinamhora.
The judge added, “I can be forgiven for saying that, it seems the height of recklessness or a monumental assumption of risk by the plaintiff to continue to provide services to the defendant despite the latter having persistently made it clear that it was not in a position to make any payment outside that provided in the contract.
“My view is that the mandate of the State Procurement Board ended once it declared the plaintiff the winner of the tender process.”
The judge said Crush Security was not expected to meddle in the execution of the contract after the conclusion of the agreement.
“In other words, that Board became functus officio. To seek its guidance in the implementation of this contract appears disingenuous. The answer lay squarely in the contract itself. In the circumstances, the relief sought cannot be afforded. Accordingly, the plaintiff’s claim is dismissed with costs,” he ruled.
