Lonerock Construction v South African National Roads Agency (SOC Limited) [2023] ZAGPPHC 527; 89831/2018 (27 June 2023)

Lonerock Construction v South African National Roads Agency (SOC Limited) [2023] ZAGPPHC 527; 89831/2018 (27 June 2023)

The court found that the contract did not entitle the defendant to object to or amend an Interim Payment Certificate once issued by the engineer. The plaintiff was entitled to payment as certified in IPC 36, as the contract only allowed for corrections in subsequent certificates, not withdrawal or cancellation of an existing certificate. The defendant's refusal to pay P&Gs and CPA was not contractually justified, and the differential treatment of SMMEs did not alter the plaintiff's rights under the main contract. The subsequent signing of a revised IPC 36 did not amount to waiver or acquiescence, as the plaintiff had consistently disputed the amendments and pursued its claim. Accordingly,...

Citation
[2023] ZAGPPHC 527
Parties
Plaintiff: Lonerock Construction; Defendant: South African National Roads Agency (SOC Limited)
Court
North Gauteng High Court, Pretoria
Jurisdiction
South Africa
Judgment Date
27 June 2023
Case Number
89831/2018
Procedural Posture
Civil Trial / Final Judgment
Outcome
Plaintiff's claim succeeds; defendant ordered to pay the balance certified in IPC 36.
Judges
Neukircher
Legal Topics
Construction Contracts, Interim Payment Certificates, Contractual Penalties, Waiver and Acquiescence
Commercial and Corporate Civil Procedure Construction Contracts Interim Payment Certificates Contractual Penalties Waiver and Acquiescence

Case Brief

Summary, issues, holding and outcome

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Parties

Lonerock Construction

Plaintiff

South African National Roads Agency (SOC Limited)

Defendant

Procedural Posture

Civil Trial / Final Judgment

Legal Issues

  1. 1 Whether the plaintiff is entitled to payment of Preliminaries and Generals (P&Gs) and contract price adjustment (CPA) for the 11-month contract overrun period.
  2. 2 Whether the defendant was contractually entitled to refuse payment of P&Gs and CPA as certified in Interim Payment Certificate 36 (IPC 36).
  3. 3 Whether the defendant's differential treatment of the plaintiff and SMME subcontractors regarding penalties and P&Gs was contractually justified.

Ratio Decidendi

The court found that the contract did not entitle the defendant to object to or amend an Interim Payment Certificate once issued by the engineer. The plaintiff was entitled to payment as certified in IPC 36, as the contract only allowed for corrections in subsequent certificates, not withdrawal or cancellation of an existing certificate. The defendant's refusal to pay P&Gs and CPA was not contractually justified, and the differential treatment of SMMEs did not alter the plaintiff's rights under the main contract. The subsequent signing of a revised IPC 36 did not amount to waiver or acquiescence, as the plaintiff had consistently disputed the amendments and pursued its claim. Accordingly,...

Court Disposition

Plaintiff's claim succeeds; defendant ordered to pay the balance certified in IPC 36.

Orders

  • The defendant is ordered to pay to the plaintiff the amount of R4 585 549.00.
  • Interest is payable on the aforesaid sum a tempore morae from 10 September 2015 to date of payment.