Mining coys at each others throat

…Over $42,900.00
Posted: The Chronicle |Wednesday, February 10, 2010

By Charles Takyi - Boadu

Two companies in the mining industry are slugging it out in court over the payment of an amount of $42,900.00, which has become a bone of contention between them.
Mining and Construction Services Limited (MCSL), located at Adjirigano in Accra, has sued Golden Star Wassa Limited (GSWL), a mining company and one Richard Gray as first and second defendants respectively for their inability to pay them the said amount.

The plaintiff, Messrs MCSL, a limited liability company, which is in the business of supplying crushing aggregates accuses GSWL, which is a mining company and Richard Gray of failing to pay it the said amount for work done.

In its statement of claim, solicitors for MCSL, Agyei Kodee Nuamah (AKN) and Associates stated that between May 2006 and June 2006, Richard Gray, acting on and on behalf of GSWL, requested it to supply and deliver crushing aggregates at a total value of $42,900.00 to GSWL. The said amount was to be paid after the defendants have inspected and accepted delivery of the said aggregates without rejection.

MCSL noted that as at July 15, 2008, the total outstanding amount for the aggregates supplied stood at $42,900.00 or its GHC equivalent. Though the period for payment for the invoice amount of the total value for the said aggregates has long elapsed, MCSL says the defendants have not only failed but also neglected and/or refused to pay the said total value to it despite several and repeated demands made thereof.

For this reason, MCSL stated that GSWL do not have a defence to its claim and will persist in default of their payment obligations unless otherwise compelled by an order of the court.

MSCL therefore claims against the defendants jointly and severally for the recovery of an amount of $42,900.00 or its GHC equivalent being total value for the supply and delivery of the crushing aggregates without rejection, which is due from GSWL to it and which remains unpaid despite several demands made for same.

It also asks for interest on the amount at the prevailing commercial bank rate from June 6, 2006 until the final date of payment with costs.

However, in its statement of defence, lawyers for Messrs GSWL, Takoradi-based Kendricks law firm denied every allegation of fact contained in MCSL statement of claim.

It denied entering an agreement with MCSL to the extent of requesting it to produce a minimum amount of 60,000 tonnes of crushed aggregates per month, stating that “after the execution of the agreement, the plaintiff was initially using a very small crushing machine which could not allow them to produce the said tonnage as contained in the agreement and consequently breached the said agreement.”

“This breach of the terms of the agreement was brought to the attention of the plaintiff and upon some representations and correspondences, the 1st defendant gave the plaintiff 3 months transitional period for the mobilisation of a bigger crushing plant to produce the aggregates as contained in the agreement specifically clause 5:2 (g)”, it noted.

According to the lawyers, this development was contained in a letter dated 6th September 2006 reiterating and drawing the plaintiff’s attention that the 3 months transitional period for mobilising a bigger crushing unit had lapsed.

It vehemently denied owing the plaintiff any money and further contended that if indeed wished to apply the penalty clause (5.6) of the agreement, stressing that it would rather have to pay a colossal amount of money to GSWL.

GSWL further contends that whatever aggregate that was produced by the plaintiff was in compliance to the agreement entered into with the MCSL and has nothing to claim therefrom.

GSWL also contends that as at 24th October 2006, when the letter of cessation of operations was sent to MSCL, they (GSWL) were not owing any monies.

“It is therefore a pure act of falsehood for the plaintiff to mount this action when it is almost 2years when the plaintiff’s activities came to and end and the plaintiff did not bring this claim against the defendants till sometime in June 2008 when a letter purporting to claim $42,900.00 was sent to the 1st defendant and which was dully replied to by the 1st defendant on 9th July 2008", it emphasised.

For this reasons Messrs GSWL says it has all the schedule aggregate requirement list and same shall be tendered during the trial to demonstrate the falsity of this claim by the plaintiff and averred that “this action is actuated by malice and is bad and therefore ought to be dismissed.”

In a reply to the amended statement of defence, MCSL insisted that the written contract to supply and deliver a minimum amount of 60,000 tonnes of crushed aggregates per month was never signed, insisting that at all material times it dealt with the 2nd defendant who happens to be Richard Gray.

Furthermore, MCSL said reiterated that Mr Gray entered into fresh negotiations with it and ordered it to supply and deliver the crushing aggregates with a smaller crusher to GSWL.

MCSL further denied GSWL’s claim that after the execution of the agreement, they (MCSL) were using a very small crushing machine which could not allow them to produce the said tonnage as contained in the agreement and consequently breached the said agreement.

It has therefore resolved to put the defendants to strict proof when trial begins.