Justice Ayo Oyebiyi of Osun State High Court on Tuesday, dismissed the application brought to the court by Henan Water Conservancy Engineering Bureau Limited and Sagittarius Nigeria Limited, the contractors handing Ilesa water project.
The claimants had filed a suit against Osun State government for unlawful termination of the project’s contract in the suit number HOS/M.205/2021 through their lawyer kunle Adegoke (SAN) and demanded for $500 million as compensation for unlawful termination of the contact.
Recall that in 2016, Osun State government decided to execute Ilesa Water Supply and Sanitation Project which was funded by a loan from the Islamic Development Bank.
The project has four components –
Construction of water transmission main,
Construction of 3 numbers of 10,000 cum concrete reservoirs, distribution of networks and design, build and operation of water treatment plant.
Islamic Development Bank had appointed Mahab Ghodss Consult Engineering as Consultant to supervise the project and in July 16, 2019, the site was handed over to the contractors.
Counsel from the Ministry of Justice representing the state government, Tijani Adekilekun had told the court that the contract was agreed to be carried out within 24 months (two years) and the time had already began to run from the date of handing over of the project site to the contractors.
The claimants failed to, as at September 8, carry out the first stage of the contract which is the of acceptable design for the water treatment plant while the already approved design for staff quarters building plan layout was not constructed.
Adekilekun informed the court that when the problem of delay of implementation of the contract persisted due to the inability of the contractor to produce approvable design, the contractor was issued a notice of termination which was rescinded at the intervention of the immediate past governor of the state, Adegboyega Oyetola.
He said after expiration of additional 12 months, the claimants were unable to deliver approved design by the consultant, thus forcing incumbent Governor Ademola Adeleke led administration terminate the contract on August 16, 2022.
Adegoke had earlier sought an order of interlocutory injunction to restrain Osun State government from executing the project by re-awarding it to another contractor.
He asked the court to order the state government to pay the sum of $500 million for unlawful termination and reinstatement of his clients.
Delivering his judgement, Justice Oyebiyi dismissed the application/suit filed by the claimants.
Oyebiyi pronounced that the termination of the contract by Osun State government on December 14, 2021 is in order and also directed the government to award the contract to another qualified firm.
