CBD saga: When millionaires fight

SHARE   |   Tuesday, 07 March 2017   |   By Staff Writer
CBD saga: When millionaires fight

An attempt by a group of local business tycoons to quash a P15.8 million claim against their investment company – Smart Partnership Enterprises - suffered a setback recently when High Court judge Terrence Rannowane dismissed their plea for dissolution of the lawsuit. Dismissing the application, Justice Rannowane ruled that SMART have a case to answer to oppose the claim and prove that indeed they do not owe Mosienyane. Now, SMART will from December 07 start calling witnesses to argue their case, among them Sam Mpuchane, Kabelo Ebineng, Martin Mannathoko, Dennis Alexander, Seleka Mokama, Anjana Suresh and an architect Charles Cook to provide expert opinion to counter Mosienyane. The witnesses are businessmen with indirect shareholding forming part of the SMART partnership conglomerate which is made up of 10 companies. Shareholding at SMART partnership is spread among 10 companies owned by elite businessmen and executives. They are Ba Ba 20 Investments, Ibis Holdings, Inter Public, 21st Century, Vision Investors, Leno Holdings, Rubio Engineering, Northern Investments, Homebase Holdings and Hemamo Investments. Advocates representing SMART sought the dissolution two weeks ago after concluding cross examination of Moleta Mosienyane, whose company Mosienyane & Partners International is suing for payment of architectural services provided in the pre-development stage of a mixed-use development on Lot 5439 in the Gaborone Central Business District (CBD). Mosienyane & Partners were engaged as architects for the pre-development phase by Project Managers, JHI Property Services (Botswana) – a company Mosienyane also co-owns. SMART had on 12 October 2009 appointed JHI Property Services to involve the services of architects and quantity surveyors who would provide their services on a risk basis during the six months pre-development phase. This means, no payment of fees shall be made for pre-development stage, on the understanding that the same architects and quantity surveyors would be appointed for the final development phases of the project. A meeting of board of directors of SMART in March 2012 confirmed the recommendation to appoint Mosienyane & Partners as the architects for the final development phases. Those architects and quantity surveyors (Mosienyane and Davis Langdon) have since been dropped from the ongoing final development, which is the centre of the current dispute. Mosienyane & Partners is demanding full payment of P15 867 654.50 for work done during the pre-development stage.  "It was the intention of both JHI and SMART that, by Mosienyane &Partners accepting the benefit of the contract, they would become party to the contract and be entitled to claim from SMART. Mosienyane &Partners did accept the benefit by accepting their involvement and rendering their services as envisaged by the contract," argues Mosienyane.

In pleas filed by Martin Mannathoko, on behalf of SMART, he argues that JHI violated an agreement they entered into by failing to compile a letter of appointment reflecting fully the terms of such an agreement for Mosienyane & Partners, for approval. Therefore, Mosienyane was never appointed in writing as per the agreement, he argues. But Mosienyane counters that Mannathoko is wrong because the section of the contract he refers to, which says appointment of architects should be in writing, was applicable if the project proceeded to the final development phase. SMART concedes that JHI involved Mosienyane & Partners as architects for an envisaged project as defined in their agreement and that the latter rendered some architectural services, but insist that they did not accept or implement his concepts and design in the final stages of the project.  SMART also deny that JHI performed all its obligations in terms of their agreement and in particular failed to produce an acceptable tenant mix proposal. "(Mosienyane's) concept and limited design was not economically viable and the initial project was abandoned. SMART thereafter embarked on a new concept and design and appointed new architects as it was entitled to do. Mosienyane & Partners did not perform all the work set out in the responsibility matrix of the agreement and for which it claims remuneration," says Mannathoko, citing examples of failure to provide information on the environmental impact and statutory requirements of the project. With the foregoing, SMART flatly refuses to pay Mosienyane. But Mosienyane opposes suggestions that he did not perform all the work and that his concept and designs were abandoned, saying in preparing design sketches he followed recommendations of a market surveyor who was engaged independently by SMART. He says the pre-development architectural designs were intended to inform the Quantity surveyor in his preparation of the cost plan, which is required at that stage by financial consultants to prepare documents for raising finance. Further, Mosienyane says, the architectural design sketches at pre-development stage are used by the development consultant for marketing the proposed development. "The sketches therefore are part of a set of documents intended to establish the feasibility and commercial viability of development on the specific piece of land, thus setting out the parameters of the project. Even if SMART did not use the sketches prepared by Mosienyane, any designs prepared by another architect or advancement of the project to the final phases would benefit from the parameters set out by consultants at the pre-development phase," argues Mosienyane.

Power play
Information surfaced showing that SMART have appointed one of their shareholders Tshipa Mothibatsela as Project Manager to replace JHI – a company partly owned by Mosienyane. Soon after appointment, Mothibatsela of Mothibatsela & Associates Consulting Engineers moved fast and terminated the agreement with JHI.  Mosienyane & partners were also kicked out and in their place Paledi Morrison & Partners, Architects and Design Consultants were appointed. Earlier in the pre-development stage JHI had rejected a bid by Mothibatsela & Associates for provision of professional services in the final development of the project. 

Davis Langdon
Quantity Surveyors Davis Langdon – a subsidiary of CCMI, who initially jointly submitted a letter of demand with Mosienyane & Partners, demanding payment of P3 million for professional fees have since settled the matter amicably with SMART. Davis Langdon were represented in the matter by Collins, Newman & Co whose partner at the time was Reswan Desai. Desai, who has since formed his own legal practice, has interest in SMART Partnership.