Road Development Agency sued for unpaid K1.5 million road works

A K1.5 million-worth lawsuit has been filed against the Road Development Agency (RDA) by a consultancy company contracted to undertake feasibility studies and detailed engineering designs of reconstruction of the Luanshya-Fisenge-Masangano road.

Lidwala Zambia Limited sued RDA in the Lusaka High Court on allegations that the Agency has failed to pay off the outstanding balance of K1,475,781.91 exclusive of Value Added Tax and withholding tax due to the company.

In a statement of claim filed in court on July 14, 2023, the litigant submitted that on January 12,2016, the company in partnership with BNC consultants entered into a written contract for the provision of consultancy services to the defendant.

The agreed term of contract was three years and it would be paid K11,503,952.00 inclusive of VAT and withholding tax.

“The consultancy services aforesaid were for the detailed design and tender document preparation and construction supervision for the reconstruction of approximately 45KM of the M16 road also known as the Luanshya-Fisenge-Masangano road, upgrading to Bituminous standard of approximately 32KM of RD470 Lamba Lima and 13Km of D770 Kafubu block roads on the Copperbelt,” it stated.

Lidwala Zambia Limited alleged that on March 30, 2016, it submitted project fee note no.1 in the sum of K393,581.32 and K145,436.72 due to it and their associates BNC Consult Limited respectively,with a cumulative total of K539,038,08.

It further stated the Agency through its paying associate, the National Road Fund Agency paid the net sum of K342,687.18 in February 2017 on the amount due to the it while the K50,894.14 believed to comprise VAT was retained by the defendant for onward transmission to the Zambia Revenue Authority.

It explained that about October 4, 2016, the company issued and delivered project fee note no. two in K509,091.52 with the sum of K371,715.69 inclusive of VAT and withholding tax due to the plaintiff

The plaintiff, however, said that despite several reminders and request for payment of K371,715.69 remained unpaid and that of the unpaid amount, and after the deduction of VAT and withholding tax, the sum of K272,377.88 is due to the plaintiff, among other project fee note.

“It was an implied term of the contract between the parties that each fee note would be settled within 14 days of presentation. The failure and or refusal by the defendant to either pay fee notes in the contractually agree time or at all constitutes breach of fundamental term of the contract,” it said.

It submitted to court that the failure by RDA resulted in the company suffering loss and damage.

Other reliefs claimed include damages for breach of contract, interest at the contratual rate and costs of and incidental to the action.

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