The fight between the Department of Trade and Industry (DTI) and ousted IT supplier Valor IT seems far from over.
Valor IT on Friday lost a bid to have a settlement agreement between it and the DTI upheld over a canned R153 million enterprise content management system.
The solution was meant to be installed at the now defunct Companies and Intellectual Property Registration Office (Cipro).
The parties have been locked in a legal battle for more than a year after trade and industry minister Rob Davies cancelled the deal last June. Davies cited a forensic report that uncovered irregularities in the awarding of the contract as the basis for cancelling it.
At the same time, Davies suspended Cipro CEO Keith Sendwe and CIO Michael Twum-Darko, indicating that both would face internal and criminal charges.
However, Sendwe died before having his day in court, and Twum-Darko's contract ran out earlier this year before the department took any action. As Twum-Darko is no longer employed by the state, his potential involvement in the alleged irregularities will not be investigated.
The cancellation meant Cipro could not install a more secure IT system, which left its database open to being abused. Cipro has since been replaced by the Companies and Intellectual Property Office, and is moving ahead with upgrading its IT systems.
Agreement reached?
After Davies cancelled the deal, Valor IT took the department to court to have the contract declared valid. Chairman Josias Molele claimed to have reached a settlement deal last November, in terms of which the DTI agreed to pay him R28 million.
Molele argues judge Raymond Zondo sanctioned the settlement by affixing a note to court papers indicating that the parties had reached an agreement.
Davies previously denied any such deal was reached, arguing that whatever was discussed during the legal proceedings was never signed off by department officials.
Valor IT had already been paid about R95 million by the time Davies put an end to work on the ECM system. The system was meant to enhance Cipro's infrastructure to cut down on fraud.
Lost battle
On Friday, judge Hennie de Vos ruled against Valor IT, dismissing its application to have the settlement deal upheld with costs.
Sidwell Medupe, the DTI's director of media and public relations, says the ruling vindicates the department.
However, Molele says he will appeal the decision. He argues the settlement deal never had any conditions, such as final sign off, attached to it and is binding.
Molele argues De Vos did not apply his mind and ignored Zondo's note and the transcript from the November arguments.
The DTI, through its legal representation, made an offer which his company accepted, says Molele. He is determined to have the settlement reached on 25 November upheld. “I'm prepared to fight tooth and nail.”
Molele denies any irregularities in the tender process, pointing out that all the companies that bid for the deal had access to Cipro's business case.
Davies has also hinted at possible legal action by the DTI to recover money that has already been paid to Valor IT, which would delay the legal battle even further.
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