MSU sues chair supplier for breach of contract

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THE Midlands State University (MSU) has dragged a local furniture manufacturing firm, R. Mc Diarmid (Pvt) Ltd, to court demanding a $242 900 refund for the 5 000 chairs it had been contracted to supply.

BY CHARLES LAITON

In summons filed on October 13 this year, the MSU also cited the company’s directors Derrick McDiarmid, Kenneth McDiarmid and Charles Cannings as co-defendants.

The defendants have not yet entered their appearance to defend.

MSU accused the firm and its directors of breaching the terms of their agreement and failing to deliver the chairs as ordered in September last year.

“At all material times, the second, third and fourth defendants (Derrick, Kenneth and Charles) were directors of the first defendant (R. Mc Diarmid). They conducted the business affairs of the first defendant negligently and recklessly to the extent that the company was unable to pay amounts owed in terms of the agreement with the plaintiff (MSU),” the MSU said.

The institution claimed that in October 2016, it entered into an agreement in terms of which R. Mc Diarmid (Pvt) Ltd was to supply, deliver and install 5 000 auditorium chairs at a negotiated sum of $461 250.

“The material condition of the agreement were inter alia that, the first defendant would supply, deliver and install 5 000 chairs in the multi-purpose hall. The plaintiff would pay a commitment deposit of 60% in the sum of $276 750 to the first defendant. The first defendant would deliver the chairs within five weeks from the date of deposit payment,” the MSU said.

“In furtherance of the agreement between the parties, the plaintiff duly paid the commitment deposit to the first defendant on or about October 7, 2016. The first defendant, however, in December 2016 breached the agreement by failing/neglecting to supply, deliver and install the chairs within the five weeks from the date of payment of the deposit as agreed.

“Owing to the breach committed by the first defendant, the plaintiff elected to cancel the agreement between itself and the first defendant and claim a refund of the 60% deposit that it had paid.”

The university further said, at the request of the firm it withheld $33 849 which was payment due to the firm in terms of other agreements thereby reducing the deposit amount due and payable to the company in the sum of $242 900.

“The plaintiff has demanded restitution of its remaining deposit amount in the sum of $242 900. In spite of repeated demand however, and despite acknowledgement of debt, first defendant has failed or neglected to restitute the plaintiff its deposit,” MSU said.