Eskom contractors in power battle

Construction giant M&R hauls Alstom to high court over failure to meet quality obligations at Kusile site

“Judge rules that Alstom is obliged to comply with the decision of adjudicator to settle dispute with M&R

POWER utility Eskom is caught in a bitter legal battle between two of its suppliers building the multibillion-rand Kusile power station.

Construction giant Murray & Roberts (M&R) hauled Alstom to the South Gauteng High Court over its failure to meet its quality obligations following arbitration proceedings.

Alstom refused Murray & Roberts’ demands after it had been contracted to supply at Kusile by the company because they were not given the green light.

The long-running saga has been in dispute since 2017 but the court has now settled it.

Alstom has now been ordered to comply with the decision of an arbitrator made in 2017.

The South Gauteng High Court has endorsed the decision to appoint an arbitration panel stating that Alstom is at fault.

Murray & Roberts was unhappy with the progress of the project and took its contractor to arbitration proceedings.

“In my view, M&R is entitled to the remedy the adjudicator has decided upon.

“I can find no compelling circumstances which would warrant this court withholding from M&R the further benefit of having the decision of the adjudicator made an order of court so as to permit of its enforcement,” said South Gauteng High Court Judge David Unterhalter.

He said he exercised his discretion in favour of issuing an order to enforce the arbitration decision.

Judge Unterhalter ruled that Alstom was obliged to comply with the decision of the adjudicator in arbitration proceedings to settle dispute.

“The courts have an inherent power to regulate their own process and develop the common law.

“The courts’ remedial competence is not constrained by the strictures of the Arbitration Act.

“It is exercised upon just and equitable considerations which take account of the fact that parties agreed to repose in an adjudicator remedial decision-making power,” he added.

Kusile is set to cost R16 billion but contractual disputes have delayed its completion.

M&R was working on a coal stockyard, coal and ash conveyors, and water supply pipelines.

The Kusile power station project is set to have six units of 800 megawatts the entire project is expected to have a total capacity of 4 800MW.

Alstom supplied the steel plates to be used by M&R for the erection of the absorbers at Kusile.

The high court found that each of the products was of poor quality.