Contractors expected to complete work for Games

WITH a little over three weeks remaining before the 7th PNG Games in Kimbe, West New Britain, new contractors Korea Papua New Guinea (K&P) Construction are expected to complete outstanding work on the province’s sporting infrastructure.
A source from the provincial government, who wished to remain anonymous, told The National that the reason they had signed on K&P was because former contractor Nivani Limited had stopped work due to a dispute over payment.
The new contractor was said to have given a cheaper rate within the time frame suiting the provincial government and the host organising committee.
“The government is disappointed with the termination but the signing up of the new contractor was a necessary step to move forward with the games,” the source said.
“After two delays in dates there was no real negotiations between Nivani and the government due to the fact that Nivani wanted full payment up front.
“K&P came in at a slightly cheaper rate given the time frame to complete. They offered to complete internal and external stadium work with only per cent upfront payment.”
Meanwhile,  Nivani’s is pursuing outstanding payments, calling the contract in dispute and referring it to arbitration under contract clauses.
General manager David Stein said there were additional works that the host organising committee requested and agreed to pay another K3.6 million apart from the original contract of K23 million.
“Nivani has not been paid any of that K3.6 million of the additional work completed,” Stein said.
In response, the source said the government offered to hold the remaining balance of K3.6m as retention until completion of work.
“Government was prepared to raise cheques and hold until the work is completed to avoid any other stoppages from Nivani which states in the signed contract that 10 per cent retention was to be held until completion,” the officer said.
“The government gave an opportunity for Nivani to reconsider its position to complete and accept the offer but was declined with the response — full payment up-front before completion.”
Nivani’s call for an arbitration also relates to the HOC’s insistence that the contract be covered by New Zealand general conditions of contract.
Stein said they wrote to the provincial administrator in March last year, saying the engineers for the contract were appointed under New Zealand condition of contract and that it would be the overarching conditions to cover the contracts that Nivani was involved in. “We have now invoked the contract clauses, the arbitration clauses, and referred it to arbitration,” Stein said. “We have had Warner Shand Lawyers write a letter to advise them that it is not possible for them to unilaterally change conditions or contract unless both parties agree to a change of contract.
“Nivani made submissions to the New Zealand high court for the appointment of an arbitrator because the provincial government will not agree to an arbitrator at this point in time.”
The provincial government said that all contracts signed between Nivani were the normal PSTB/Works contracts in which the provincial administrator and Stein signed.
“The NZ standard conditions were only to be used as a guide to the overall contract with special conditions attached in which the provincial administrator signed a letter to use NZ standard conditions. “The special conditions in the NZ standard contract must be agreed by both parties and signed but in this case only two out of the seven contracts awarded to Nivani had special conditions signed although all contracts had special conditions attached.
“To use the general conditions without special conditions leaves both parties at risk in which the government is now reverting back to the PSTB/Works contract which is the only legal contract signed.
“There is no signed NZ standard contract between WNB government and Nivani,” the source said.
Stein said they were entitled under the contract to suspend the works due to non-payment.
The provincial government source said they are focused on delivering the PNG Games and if the matter was taken to the courts they would deal with it in due course.