FORMER Augur Investment managing director Michael Van Blerk, whose company constructed the Airport Road in Harare, has trashed Citizens Coalition for Change vice-president Tendai Biti's assertion that the company illegally received vast tracts of land before carrying out any work.
He said the financially-troubled Harare City Council offered land to Augur Investment as part payment for the work done.
While submitting his evidence in court on his application for referral to the Constitutional Court, Biti submitted that Augur Investments duped Fairclot Investments during the construction of the Airport Road, resulting in the firm represented by Van Blerk receiving vast tracks of land without any work done.
Biti said the company was so powerful that itreceived the deed of settlement without following procedure.
But Van Blerk denied this saying: "This misinformation campaign has been largely expressed on underground’ media platforms, driven by people desperate to avoid accountability. Some articles have also been featured in the Press, informed by dishonest sources. My suspicion is that defendants accused of wrongdoing against Augur and its employees are using these false statements to evade responsibility before Zimbabwe's legitimate courts.
"In 2008, Augur Investments and the City of Harare formed a joint venture for the Sunshine Land Development project. Zimbabwean staff were recruited for this work, which included Mbudzi People's Market, a 6 000-square metre covered market, amongst other projects.
"The government approved this joint venture, and in 2009, Augur registered as a foreign investor with the Ministry of Justice. This joint venture invited Augur to plan, design, and construct the Airport Highway. As the Airport Highway is a national road, Augur and the City of Harare were required to obtain government approval in order for Augur to construct it. One of the largest road construction companies in Southern Africa, Power Roads, priced the project independently."
He added that the Airport Road project was finished with asphalt finish which is more expensive that the normal chip and spray tarmac .
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"The plan was approved by the President and Cabinet after being presented to government. The Ministry of Transport and the Ministry of Local Government were designated as government supervisors by Cabinet with final approval received from the Ministry of Finance. Due to the municipality's inability to make cash payments, 90% of Augur’s payment was offered in the form of land instead of cash. The government supported this initiative and contributed additional land to the project in order to aid the City of Harare. This was reduced to a legally binding contract signed by both parties," he said.
Van Blerk said before land tranches were paid out to Augur, the Zimbabwean-hired design engineers, Ministry of Transport engineers, council engineers, and Ministry of Local Government engineers were responsible for reviewing and approving the work and progress certificates/invoices.
"To facilitate this payment process, Augur formed a number of Zimbabwean landholding corporations and received Reserve Bank of Zimbabwe approval for these Zimbabwean landholding corporations and their offshore shareholding. Only after official and approved progress payment certification by the three governing entities would land be released. Augur recruited Fairclot, a local company, as a subcontractor under its direct supervision. Fairclot was not the entity responsible for construction, but rather a sub-contractor.
"In exchange for its services, Fairclot initially agreed to accept a 25% cash payment and a 75% land payment. This land payment portion could only be made after delivery of title from the City of Harare. Fairclot breached these original contractual terms, and demanded a revision to a 40% cash payment and 60% land payment. Augur paid Fairclot 40% of the invoiced amounts in cash, close to US$4 million, with the remaining 60% to be paid in land."
"The operational incompetence of the City of Harareresulted in massive delays at Augur's expense, impeding work from beginning to end. Augur suffered the brunt of delay related expenses. The City of Harare then attempted illegally to terminate the valid contract, resulting in arbitration, which Augur, represented by Advocate Nelson Chamisa, ultimately won.
"The arbitration and subsequent court award mandated that Augur' be compensated with a parcel of government owned land whose title was held by a law firm with which Augur had a close working relationship. Tragically, the appointed partner of this firm had died, disrupting the flow of information at the law firm, and the title deed was not delivered to Augur. Resolution was affected with the intervention of the Sheriff of the court," Van Blerk said.
He said following successful arbitration, Fairclot was offered land as settlement for the outstanding payment but declined and elected to pursue legal action.
He said they were later awarded cash payment as a result of a court ruling and Augur paid them.
"For unclear reasons, one of the Fairclot directors subsequently had a large billboard slandering Augur's legal rights erected in Borrowdale and is currently on trial for this violation," he said.