A legal dispute between Mantra Consulting and Valor IT, over a payment Mantra allegedly owed the latter, has been settled out of court.
The dispute dates back more than a year and relates to the canned R153 million enterprise content management (ECM) system contract at the Companies and Intellectual Property Registration Office (Cipro).
Mantra went to court to force Valor IT to pay it for services it had supplied to Valor when Valor was carrying out the ECM contract. In May, the Gauteng South High Court, in Johannesburg, ordered Valor IT to pay Mantra R2.5 million with interest.
Last June, Valor IT won an application to appeal the court ruling and was set to head to the Bloemfontein appellate division this year to argue its case. However, the parties have now reached an out of court settlement and Valor IT has withdrawn its application.
Mantra CEO Abe Mbulawa says Valor's appeal was withdrawn at the end of May and “both parties are happy”. He cannot disclose the terms of the settlement, as it's confidential.
Mbulawa says the companies have agreed to work together in future. “I don't believe in burning bridges in the IT industry.”
Final payment?
Mantra went to court to have a supply contract between it and Valor declared valid, and to force Valor to pay out R10.5 million. The Johannesburg court ordered Valor to immediately pay R2.5 million and interest, and argue why it shouldn't be liable for the balance.
Valor's argument was that it paid what was due with a R2.5 million cheque, which was in full and final settlement of any amounts owning. Valor argued that Mantra deposited the cheque, which it saw as acceptance that the debt was settled.
Mantra argued that it didn't agree that the payment was in full and final settlement of the debt and, even though it deposited the cheque, more money was due to it. The court ruled that both parties had to be in agreement that the payment was the final one.
Dragging on
Meanwhile, a dispute between Valor and the Department of Trade and Industry (DTI) over the canned ECM contract has yet to be resolved.
Trade and industry minister Rob Davies cancelled the deal after a forensic investigation revealed irregularities in the awarding of the tender. He also suspended Cipro CEO Keith Sendwe, who has since passed away, and CIO Michael Twum-Darko.
Valor IT took the department to court to uphold the contract and claims to have reached a R28 million settlement last November. Trade and industry minister Rob Davies has denied that any such settlement was reached, as nothing was ever signed off.
The parties met in court again in March and May, when Valor IT tried to enforce its settlement. DTI's director of media and public relations, Sidwell Medupe, says the department is waiting for judgment in the matter as to whether a settlement was reached in November.
Cipro has since merged with the Office of Companies and Intellectual Property Enforcement to form the Companies and Intellectual Property Commission.
Valor IT chairman Josias Molele was not immediately available this morning to comment.
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