Phethogo Consulting (Pty) Ltd and Others v MEC: Free State Provincial Government: Department of Public Works and Infrastructure (5009/2021) [2022] ZAFSHC 346 (7 December 2022)

Phethogo Consulting (Pty) Ltd and Others v MEC: Free State Provincial Government: Department of Public Works and Infrastructure (5009/2021) [2022] ZAFSHC 346 (7 December 2022)

The court found that the interim payment certificate issued in terms of the construction contract is a liquid document, amounting to an acknowledgment of debt by the respondent. The respondent failed to advance any valid defence to payment, as the contract expressly provided for the CPAP base month and the...

Source-derived case information.

Citation
[2022] ZAFSHC 346
Parties
Applicant: Phethogo Consulting (Pty) Ltd; Applicant: Dikopo Construction (Pty) Ltd; Applicant: Razzmatazz Civil (Pty) Ltd; Applicant: SVP Quantity Surveyors and Projects Managers (Pty) Ltd; Applicant: Construction Safety Services CC; Respondent: MEC: Free State Provincial Government: Department of Public Works and Infrastructure
Court
Free State High Court, Bloemfontein
Jurisdiction
South Africa
Judgment Date
7 December 2022
Case Number
5009/2021
Procedural Posture
Civil Application / Opposed Motion for Payment Based on Interim Payment Certificate
Outcome
Application granted in favour of the applicants.
Judges
Van Rhyn
Legal Topics
Construction Contracts, Interim Payment Certificate, Liquid Document, Specific Performance, Contractual Liability
Commercial and Corporate Civil Procedure Construction Contracts Interim Payment Certificate Liquid Document Specific Performance Contractual Liability

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Parties

Phethogo Consulting (Pty) Ltd

Applicant

Dikopo Construction (Pty) Ltd

Applicant

Razzmatazz Civil (Pty) Ltd

Applicant

SVP Quantity Surveyors and Projects Managers (Pty) Ltd

Applicant

Construction Safety Services CC

Applicant

MEC: Free State Provincial Government: Department of Public Works and Infrastructure

Respondent

Procedural Posture

Civil Application / Opposed Motion for Payment Based on Interim Payment Certificate

Legal Issues

  1. 1 Whether the respondent is obliged to pay the amount certified in the interim payment certificate.
  2. 2 Whether the respondent's budgetary constraints or pending final invoice constitute a valid defence to payment.
  3. 3 Whether the application is premature due to ongoing settlement discussions.

Ratio Decidendi

The court found that the interim payment certificate issued in terms of the construction contract is a liquid document, amounting to an acknowledgment of debt by the respondent. The respondent failed to advance any valid defence to payment, as the contract expressly provided for the CPAP base month and the obligation to pay certified amounts within 21 days. The respondent's arguments regarding budgetary constraints, pending final invoice, and alleged prematurity of the application were rejected as inconsistent with the contract terms and irrelevant to the applicants' right to payment. The court held that the respondent is contractually bound to pay the amount certified in the interim...

Court Disposition

Application granted in favour of the applicants.

Orders

  • The respondent shall pay to the applicants the amount of R 7,442,219.82.
  • The respondent shall pay default interest on the amount of R 7,442,219.82 at the rate of 7% per annum calculated from 14 October 2020 until date of final payment.