The Eastern Cape High Court (Port Elizabeth) has declared the Nelson Mandela Bay Municipality’s multi-million-rand bus technology contract with Lumen Technologies invalid, says a report in The Herald.
It adds the order by Judge Mandela Makaula ended what could have been a lengthy and costly legal battle for the city. This means the municipality can finally put the R174m contract out to tender. The report adds the municipality turned to the courts to try to have its contract with Lumen set aside amid allegations that the company had inflated prices by up to 900%. Lumen denied the allegations. The contract, although one of the biggest awarded by the city, was never put out to formal tender. Instead, the municipality used a supply chain management law that allowed the city to use the contract of another organ of state that had gone through the tender processes, so they decided to use Lumen as it had undertaken a similar contract with Cape Town.
Article source: http://www.legalbrief.co.za/article.php?story=20140816101042310