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Construction companies plead for intervention

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VILLAGERS around Mohale Dam, about 70km north-east of Maseru, are an unhappy lot.

When the dam was built about 26 years ago, they were told that it would significantly improve their lives and would help them escape the wretched poverty.

But two decades later, nothing of that sort has happened.

TIM Plant Hire is owed M40 million by the Qingjian Group for its construction work on the 91km Mpiti-Sehlabathebe Road.

It is also owed M17 million by Shanxi Construction Investment Group (SCIG) and Shanxi Mechanization Construction Group (SMCG) for work on the Mpilo Boulevard project.

The Maseru City Council (MCC) has since cancelled the M379 million Mpilo Boulevard project after discovering that SCIG and SMCG, the lead partners in the joint venture with TIM, forged an advance payment guarantee to claim the M14 million initial payment to start work.

LSP has appealed to Energy Minister Professor Nqosa Mahao while TIM is pleading with the Minister of Public Works, Matjato Moteane, and Local Government Minister Lebona Lephema.

Moteane is responsible for the Mpiti-Sehlabathebe Road while Lephema is in charge of the Mpilo Boulevard.

Tuwana, SCIG and SMCG claim they could not pay the companies because they did not meet their obligations as partners and sub-contractors. They point to project delays and non-compliance with contractual terms to justify their refusal to pay the full amounts.

But LSP and TIM accuse the Chinese companies of using nasty business tactics and making false allegations to avoid paying for work completed, approved and accepted by the clients.

In a letter to Professor Mahao, LSP says Tuwana has been refusing to settle the debt despite that work has been completed and the solar power station commissioned.

The M37 million debt includes M8.9 million for work done and M28 million for claims against Tuwana’s late delivery of materials for the substation and the tower.

LSP says it completed the project despite Tuwana’s failure to provide proof of financing and failure to deliver materials on time.

The company says the minister should intervene because Tuwana is now shifting goalposts, deliberately misinterpreting the contract, avoiding due process and making false allegations to avoid paying up.

LSP tells Professor Mahao, in a March 20 letter, that Tuwana fired an arbitrator who had ruled in the LSP’s favour. It accuses Tuwana of making false allegations of non-compliance to avoid paying.

For instance, Tuwana alleged that LSP did not conduct tests and commissioning during the “most critical trial operation stage” of the Ramarothole Solar Farm project.
The LSP however says this is a false allegation contrived to avoid paying.

The truth, LSP says in the letter to the minister, is that the representatives of Tuwana and its other subcontractor, Sinoma Energy Conservation, were present during the tests and commissioning.

So were representatives of the Lesotho Electricity Company (LEC), the buyer of the power from the solar farm.

The LSP says the project has been handed to the government and is “working and functioning” but Tuwana and Simona failed to issue Take Over Certificates.

“It is therefore a contradiction in material terms for Tuwana to take over the works and then claim tests and commissions were not conducted, yet it took over the work and handed the same over to the government,” LSP says in the letter.

LSP says instead of paying Tuwana is now accusing them of failing to perform some duties that were never part of their obligations in the contract.

For example, Tuwana claims LSP refused the Ministry of Energy’s instruction to restore the site to its original state. LSP however says this is false because the ministry’s proposal related mainly to stormwater management which were “design matters” that were never part of its contract with Tuwana.

LSP is requesting Professor Mahao to instruct Tuwana to pay the debt and “refrain from making baseless allegations” against it. It claims to have been left on the “brink of bankruptcy due to non-payment”.

TIM’s M109 million contract with Qingjian to work on 20km of the 90km Mpiti-Sehlabathebe Road was signed in May 2019.

In their March 19 letter to the Minister of Public Works, TIM alleges that Qingjian consistently delayed payments throughout the contract and starved it of cashflows it needed to continue working.

It says Qingjian has refused to pay the M40 million debt despite that work has been completed as per the contract.

TIM says because Qingjian failed to make payments on time several contractors abandoned work until the Ministry of Public Works intervened.

It says after starving it of payments and “stifling” its cash flow, Qingjian proposed to supply construction material and then deducted the cost from future payments.

Those deductions, TIM says, were made at cost prices as agreed but Qingjian didn’t pay its debt in full. Instead of paying up, Qingjian claimed to have assisted TIM with material and financial support. Qingjian also alleged that TIM started work in secret and was overpaid millions.

TIM denies these allegations, pointing out that it repaid Qingjian for the materials and provided evidence that it is owed M40 million. It also dismissed the claim that it started work in secret.

On the Mpilo Boulevard project, TIM says SCIG and SMCG are refusing to pay the outstanding M17 million despite intervention from the MCC and the Minister of Local Government.

SCIG and SMCG claim they stopped paying TIM because it supported a claim by a consultant who helped the joint venture write the tender of the project.

TIM however says it is SCIG and SMCG that discarded the consultant after winning the tender. The company says it supported the consultant and paid part of his bill for writing the tender. TIM has also dismissed allegations that it demanded payments without confirmation of engineering quantity and also received help from SCIG and SMCG.

It says SCIG and SMCG made its work “close to impossible” and there is evidence that interventions by the MCC and the minister did not help because the companies were hostile.

TIM wants the Minister to intervene so that it “does not suffer further financial prejudice due to non-payment”.

Staff Reporter

 

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Blow for former DCEO boss

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AN attempt by Advocate Mahlomola Manyokole to block his prosecution for fraud and money laundering failed last Friday after the Court of Appeal dismissed his petition.

Advocate Manyokole and one of his seven co-accused, Relebohile Lesholu, approached the Court of Appeal after High Court judge Justice ’Maliepollo Makhetha refused to permanently stay their prosecution last year.

Manyokole was first suspended and later fired as the director-general of the Directorate on Corruption and Economic Offences (DCEO) before he was dragged to court on criminal charges in 2021.

Manyokole and Lesholu were seeking a permanent stay of prosecution after the crown took 18 months without prosecuting them from the date of their first appearance in the Magistrate’s Court.

They were also complaining that the state charged them before investigations were completed, citing challenges with respect to appointment of prosecutors for the trial.

They applied for a permanent stay of prosecution before Justice Makhetha on grounds that they were denied the right to a fair trial within a reasonable time as the state had failed to furnish them with indictment, criminal docket and witness statements.

The required documents were however furnished before the stay application was heard, leading to Justice Makhetha dismissing the application on grounds that the matter had become moot.

The President of the Court of Appeal, Justice Kananelo Mosito, sitting with Chief Justice Sakoane Sakoane and Justice Moses Chinhengo, found that the period of delay was not egregious and caused no irreparable trial-related prejudice.

The Court of Appeal said the criticism that Justice Makhetha erred in deciding that the matter of the issue of supply of the documents was moot by the time the stay application was heard or finally decided cannot be faulted.

“The State explained in sufficient detail why the documents were not furnished by the time of the stay applications,” Justice Mosito said.

“That explanation is not fanciful but reflects the reality and challenges faced by small jurisdictions such as ours in dealing with many complex and serious offences against accused persons in one trial,” he said.

“There was no refusal by the state to furnish the documents.”

The court found that the state faced real challenges with regard to completion of investigations, appointment of prosecutors and associated issues including the need for thorough preparations for the trial by the appointed prosecutors.

The state, the court said, was edging towards the holding of the Pre-Trial Planning Session (PTPS), scheduled for December 12, 2022, when they lodged the stay applications in the forlorn hope that a permanent stay would be granted.

The court determined whether the delay of 18 months was so inordinate or over-lengthy as to warrant the drastic order of a permanent stay of prosecution.

It found that it cannot be said that the delay in bringing the accused to trial in this case is egregious, nor can it be said that there already had been trial-related prejudice suffered by the appellants.

“A permanent stay of prosecution is a drastic and exceptional remedy entirely unsuitable to be granted at this nascent stage of the proceedings,” Justice Mosito said.

Justice Mosito said had the appellants “not truncated the process and had allowed PTPS scheduled on 12 December 2022 to go ahead, the trial may have been completed by now, 15 months later”.

He said accused people and their lawyers must be discouraged from pursuing unmeritorious applications for permanent stay without proper regard to the complexity of charges they are facing and the availability of institutional resources.

“Although the appellants have not been successful, costs may not be visited upon them, this being essentially a criminal matter,” he said.

The court also found that the appellants themselves contributed to the delay of their prosecution.

One of the state prosecutors, ’Mamongonyo Baasi, explained the causes of the delay in submitting the docket.

She said the 24 charges “are sophisticated economic offences” committed by senior officials of the DCEO and require a high degree of attention from any would-be prosecutor.

She said the forensic report that the state largely relies on was only completed on June 20, 2022.

The lawyer initially assigned to prosecute the case withdrew from the matter and new prosecutors had to be appointed and they needed time to familiarise themselves with the voluminous documents involved.

The prosecutors had to consult with necessary witnesses including forensic experts from PriceWaterhouse & Coopers who are resident in South Africa.

Baasi denied that the charges are trumped up and asserted in strong terms that there is a prima facie case against all accused persons as disclosed in the docket.

She said the accused persons demanded the documents verbally and in writing before the investigations were completed.

During the period between May 2021 and October 2022, there had been a change of prosecutors.

Responding more directly to Manyokole’s affidavit, Baasi said the prejudice he suffered, if any, did “not outweigh that which the State would suffer if a permanent stay was granted”.

“The state undoubtedly suffers prejudice if such heinous crimes are not prosecuted in circumstances where (Manyokole) was operating within the purview of a law enforcement agency and arbitrarily used institutional power of the DCEO for self-aggrandisement,” she said.

Staff Reporter

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Lawyer wins praises for defending legal profession

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THE Court of Appeal has praised Advocate Rethabile Setlojoane for resisting the police’s attempt to force him to violate the principle of attorney-client privilege during investigations.

The Court President, Justice Kananelo Mosito, flanked by four other Justices of Appeal, last Friday ruled that it is crucial to uphold the fundamental legal principle of attorney-client privilege.

The court said Advocate Setlojoane had sought to vindicate not only his own rights but also the rights and ethical obligations of the legal profession as a whole.

The court also criticised the High Court for declining jurisdiction when Advocate Setlojoane approached it last year complaining about the police’s conduct.

Advocate Setlojoane is representing Lehlohonolo Selate who is currently in prison facing a raft of charges.

Selate is suspected of defrauding the government of M50 million between October 2020 and September 2021.

A company called Sunny Penny (Pty) Ltd, in which Selate has some interest in, is also suspected of being involved in the fraud.

The police investigators summoned Advocate Setlojoane for questioning following the payment from Sunny Penny (Pty) Ltd.

During the questioning, the police directed him to surrender all files relating to his client and money paid as fees by Sunny Penny (Pty) Ltd.

Advocate Setlojoane refused to do so, citing the principle of lawyer-client privilege.

He was taken to the Subordinate Court in an attempt to have him joined as an accused in the case against Selate.

However, his lawyer objected to this joinder by invoking provisions of Section 128(1) of the Constitution of Lesotho, which requires that constitutional questions be referred to the High Court.

The magistrate accepted the objection and did not join Advocate Setlojoane as an accused.

Consequently, he instituted an application in the High Court and on June 12 last year a coram of three judges made up of Justices Moroke Mokhesi, Polo Banyane and, ’Maliepollo Makhetha heard the application.

On September 14, 2023, the High Court delivered its judgment and dismissed the application, declining to exercise its constitutional jurisdiction over the violation of the lawyer-client privilege and the right to legal representation.

The High Court based its reasons on the availability of other adequate means of redress.

The court said the lawyer-client privilege is a fundamental principle that is essential for effective legal representation and protecting client’s rights.

It also said by declining jurisdiction, the High Court missed an opportunity to guide the scope and application of the lawyer-client privilege within the Lesotho legal system.

The court said, however, it is important to note that section 22 of the Constitution allows the High Court to decline to exercise its powers if it is satisfied that adequate means of redress are or have been available under other laws.

The court should exercise its discretion to decline jurisdiction only in “very exceptional circumstances”.

The Court of Appeal highlighted “the right of the client to be free from disclosure of confidential communications with his or her lawyer, subject only to the limited exceptions recognised by the common law”.

The court emphasised that the lawyer-client privilege is not merely a rule of evidence but a fundamental principle that ensures the effective exercise of the right to legal representation and the fairness of criminal proceedings.

It also said the rationale of the privilege is not the protection of the individual client, but the upholding of the administration of justice itself, which depends on the free and full communication between clients and their legal advisers.

It said an accused person could challenge the admissibility of evidence obtained through the unauthorised recording of conversations with their legal counsel, as such recordings would violate the lawyer-client privilege and undermine the right to effective legal representation.

The court said while the Money Laundering and Proceeds of Crime Act 2008 does not directly mandate a legal representative or adviser to hand over client funds paid as fees, it imposes obligations to report suspicious transactions.

If subsequent investigations and legal processes determine that these funds are proceeds of crime, they may be subject to confiscation or forfeiture.

Therefore, the legal representative’s duty primarily involves reporting rather than direct transfer of funds to the authorities, unless directed by a court order following due legal processes.

The court said while the police do not have the explicit authority to directly demand the handing over of client funds paid as fees to legal advisers merely on suspicion, they are permitted to seize such funds if there is a reasonable suspicion they are proceeds of crime.

This would typically follow from a structured legal process including reporting, investigation, and potentially judicial proceedings where evidence supports the suspicion of money laundering or related criminal activities.

It said while it is imperative to dismantle the barriers that secrecy laws may create in the fight against financial crimes, it is equally crucial to uphold the fundamental legal principle of attorney-client privilege.

The preservation of this privilege ensures that while legal practitioners may be required to disclose certain information, the core elements of their advisory role remain protected, which is vital for maintaining trust between clients and their lawyers.

The attorney-client privilege is a fundamental principle that underpins the right to legal representation and the fairness of criminal proceedings, the court said.

It said the police investigators had no legal basis for requiring Advocate Setlojoane to hand over his client’s funds paid as fees.

To compel him to become an accomplice against his own client by disclosing privileged communications or assisting in the prosecution of that client would strike at the very heart of the faithful discharge of a lawyer’s ethical duties, the court found.

It said even if he were to ultimately fail on the merits before the High Court on remittal, his pursuit of the appeal has undoubtedly served the public interest by elucidating the scope and application of the lawyer-client privilege within our legal system.

Staff Reporter

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Judge grills prisons boss

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THE chairman of a commission of enquiry investigating the escape of prisoners in Maseru last year has issued a damning assessment of the Lesotho Correctional Service (LCS) boss’ leadership skills.

Justice Realeboha Mathaba grilled Mating Nkakala over the lack of a strategic plan for the LCS.

He said the Lesotho Correctional Service Act mandates the commissioner to draft policies for the organisation.

Nkakala responded by saying they were on the verge of engaging a consultant to help draw up strategies for the LCS.

“Normally consultants do not do everything, they just facilitate, meaning you have to have a vision as a leader,” Justice Mathaba said.

He also asked Nkakala about how long the institution has been operating without a clear strategic plan and policies and he answered saying the last time it was done was in 2010.

“Meaning for the past 14 years the institution has been operating without any direction,” Justice Mathaba said.

Nkakala admitted that it has been 14 years without a strategic plan.

Justice Mathaba again asked Nkakala if he had received any training before getting into high office.

“Not only you but other officers who help you. Did you get any training?”

Nkakala said their wish is for every officer to get training and attend workshops on their promotion to the next rank.

“But, due to budget constraints, we cannot get such training,” Nkakala said.

Justice Mathaba said most of the problems that Nkakala had mentioned show that there is lack of leadership and teamwork.

“It is evident that there is no teamwork between you and your senior officers,” he said.

Nkakala also conceded that there are divisions among the staff with some supporting him while others do not.

He said there are some officers who work well with him, “even though it is not everyone who supports me”.

Justice Mathaba said Nkakala should have been equipped with the necessary skills to lead the institution.

“I am still on the issue of how capacitated you are in leading the institution,” he said.

He said Nkakala is still leading the institution by using the assistant commissioner’s tactics and principles as he never received any training after being promoted.

“Did you get any training that equipped you with the leadership skills while still an assistant commissioner?”

Nkakala said he recalled attending a course.

Justice Mathaba then said based on Nkakala’s evidence, he sees that there is no teamwork at the institution’s leadership.

Nkheli Liphoto

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