THE REIGN OF FRAUD AND DECEIT IN GOVERNANCE: Case of Rochas Road revolution contractors.

On Monday, November 19, 2012, the Honourable Commissioner for Information and Strategy, Chinedu Offor, in an interaction program on one of the Radio Stations stated that contractors who had been paid without doing their work will be arrested and prosecuted.  The Rescue Mission Government of the State claims that she has already expended 13.9 billion naira in Rochas Road Revolution.

In interviewing over 30 contractors involved in the so called Rochas Road Revolution, I was made to understand that the actual contract document is in the custody of the Ministry of Works.  That no contractor was given an original or a duplicate copy of the contract document.  However, they all stated that the following terms were contained in the original contract document.

  1. Tarring of nineteen (19 km) Kilometers of road.

  2. No mobilization fee however upon the completion of 30% of the contract, the contractor will then be paid to the extent of work completed.

  3. Contract prize for one kilometer of road tarred is N120 million

 

These contractors, without the traditional financial mobilization, did mobilize to site and commenced work in earnest, believing that they have a valid enforceable contract from Imo Government.

But the intent, abnitio, was never to pay these contractors.  Any contract over a certain amount and/or a contract that cannot be completed within a year is subject to the status of frauds.  Status of fraud is a legal term that makes a perfectly valid contract unenforceable if the contract is not memorialized in a contract document.  Although, these contractors claims to have a memorialized agreement but the agreement is in the custody of the Ministry of Works.  But since they do not have a copy of such agreement and cannot produce the agreement if needed, they are out of luck.

The doctrine of status of frauds was originally adopted under common law to avert the infirmities emanating from human memory in situations where the completion of a contract would take a year or more, and in situations where the amount involved in a contract is such some that nobody could part with due to the mistake of he said, she said.  To avoid this from happening in contract, the doctrine of status of fraud required that every contract of a certain sum, and all contracts that cannot be completed within a year regardless of the sum, must be memorialized in written document.

Essentially, the doctrine of status of fraud designed to avert fraud may have aided the government in perpetrating fraud on the Rochas Road Revolution Contractors.

While in the process of executing their road contracts, about six to eight months into the contracts, the contractors were summoned by the Governor, and in the course of his address to them, he informed then that not every road currently under contract will be tarred.  He informed them that due to the enormity of the cost and the amount of roads under the scheme, that he has decided to assign grades to each road.  Only roads assigned as grade “A” roads will be tarred, Grade ‘B’ road will only be primed and grade “C” roads will be graded.

As a result of the denominations assigned to these roads, the contract cost of one kilometer of road is now reduced to N60 million.  The contract cost of the Grade “A” roads will remain as agreed.  The contractors were not happy with the unilateral modification of the agreement by the Governor, however they all returned back to work to complete the thirty percent (30%) work needed before payment as originally agreed.

This unilateral modification of the original agreement by the Governor, shows that the Rescue Mission Government of Owelle Rochas Okorocha never intended completing these road projects from the get go.  It must be recalled, that the frenzy of these road projects commenced in the middle of the tribunal litigation.

Between September and November 2011, the entire Imo State was turned into a giant road construction site.  “Construction on-going” became the watch word of Rescue Mission fanatics in the state.  These were later christened Rochas Road Revolution.

But at each instant, I took time to caution my friends involved in the road construction bonanza.  My fear at all times was if the Federal Government’s capital infrastructural budget was less then N500 Billion, how can Imo, a State completely dependent on allocation from the Federation, afford to pay over 300 contractors each with a contract for 19 kilometer of road at N120 million per kilometer, the alleged original prize. Nineteen kilometers of road multiplied by at least 300 contractors, will give 6,600 kilometers of road approximately under Rochas Road Revolution.  Six thousand, six hundred kilometers of road at the original price of hundred and twenty million (N120,000,000.00) Naira per kilometer comes to over Seventy nine Billion, two hundred million naira.

Based on this rough calculation, I concluded that there was no intent by the Government to complete this roads, and since the contractors agreed to mobilize to site and commence work without the traditional mobilization in road contracts, that they would not be paid.  Based on this cursory assessment, I advised my friends engaged in the road contracts to be very careful.  But most ignored me.

How can any responsible government whose total annual income is less than N100 billion engage in road construction totaling over N80 billion?

It was on the above basis that I advised my friends involved in the purported Rochas Road Revolution (RRR)) to be careful.  I especially discussed the above details with my closet friend who had mortgaged a property for 10.5 million naira, plus another N10 million naira from his savings which he claimed to have sunk into the road contracts in order to meet the thirty (30%) percent needed before payment is made.

But upon the conclusion of the meeting between the contractors and the Governor, where the Governor allegedly unilaterally modified the agreement, I received several calls from my road contractor friends.  The substance of what they said in these phone calls was that now the Governor had unilaterally reduced the contract amount for a kilometer of road to N60 m, it means that the state intends to pay them.

Not wanting to engage in any legal argument, I just listened and did not offer any legal opinion.  But I did call my close friend who had mortgaged a property in order to complete the 30% required of the contract before payment.  I told to him to immediately use every available resources within his control to ensure that he is paid something, anything as soon as possible.  I then told him that the claimed modification of the road contracts by the Governor is not valid and therefore, not legally enforceable.

  A valid contract modification must have legal consideration to be enforceable.  But the said modification by the Governor does not have legal consideration coupled with the fact that the original contract itself may not be enforceable for want of memorialization in accordance with the status of frauds.  I told him that legal consideration must be evidenced for a valid modification to be enforced by any court.

Legal consideration is something, (such as an act, a forbearance, or a return promise) bargained for and received by a promissory from a promise.  In layman’s term, the Governor must give something or forgo something for the modification to be valid and enforceable.  But in this case, the state did not give the contractors any additional thing to get away with reducing the contract price of one kilometer of road from N120 million to N60 million.

I finally told my close friend that although the original contract and the purported modification may not be valid and enforceable, still they may be able to recoup some of their money through the doctrine of detrimental reliance.  The only difference will be that the damages under detrimental reliance is not based on contract damages but rather only the actual cost expended in the work done.

 Contract damages are based on the expectation of ones bargain or the benefit of ones bargain.  It includes the cost of doing the work of the contract and the profit.  But the damages awardable based on detrimental reliance is only the cost of work done on the contract.

Based on this advice, my friend pursued his payment with all amount of vigor and luckily for him, he was one of the few contractors paid.  He informed me that he was paid 18 million naira after unexplainable deductions.  He was expecting after completing 5.7 kilometers out of the 19 kilometers of the contract to be paid 342 million based on the modified contract price of 60 million naira per kilometer but he received N18 million.

Upon the receipt of the 18 million naira, he paid up his mortgage loan to the bank and moved back o his original station in Lagos.  From all indications, the few contractors paid, under Rochas Road Revolution contracts, were paid based on detrimental reliance that is why no contractor was paid anything close to 342 million naira which would have been the actual contract amount based on the so called modification and the 30% percent completion before payment contained in the alleged original contract document.

However, the overwhelming majority of the contractors who were not paid a dine are now protesting and carrying placards around demanding for their payment.  These unfortunate and hapless Imo citizens have little or no chance of ever getting paid.  The chances of any of these contractors winning a penny from a Lawsuit are “IFY” at best.  The only chance of any of them getting a penny from the state government is through political negotiation.  The question then is who would spend his political currency negotiating on behalf of these contractors?  Many of the Imo elder statesmen who could have negotiated on behalf of these contractors believe that only their greed put then in their current situation.

Speaking to one of the known road contractors in the state, he said, “who, in his right mind, unless blinded by greed, will go to a bank for facility to execute a road contract without a contract document and an initial mobilization fee.  He further said that government contracts are not done just based on trust because anything could happen at anytime.  These contracts were entered into at the height of the tribunal litigation.  What if the tribunal nullified the election of Governor Rochas Okorocha, what document will the contractors present as evidence of a contract with the state when none of them is in possession of the contract documents.

One of my heroes, my late father, Mr. Sebastian Chiedozie Okpalaeke told me that, “Information is knowledge and knowledge is power, but only the appropriate use of power, derived from knowledge is wisdom.

The Imo State Government by its superior legal knowledge and negotiating power perpetrated fraud to these hapless unfortunate citizen contractors but to the detriment of the entire Imo State.   December is the last month of the year.  As Igbos, we are known as sojourners all over the globe and at year’s end, in December, many make the traditional annual pilgrimage from their stations back to our land in the heartland of Igbo nation.  As a result of this annual pilgrimage back home, the previous Government made it an annual project through IRROMA to grade every rural road in all nooks and crannies of the State.  This makes our rural roads motor able, thereby easing the traffic of people and goods, even with the increased number of vehicular traffic as a result of this annual pilgrimage.  But this year the situation will be different.

Without IRROMA which has been rendered moribund and its assets nowhere to be found even in the state, Imo will be lucky if the major rural roads are graded.  By the way, what happened to these Assets of IRROMA valued at 12.5 billion naira by the United Nations Development Agency in 2010?

Why would any sane government enter into an agreement for the grading of its rural roads at the cost of 60 million naira per kilometer when a previous government did the same grading at zero cost to the commonwealth of the people of the state?

Finally another hero of mine the legendary reggea artist Robert Nesta Marley (Bob Marley), in his song small Axe said, that it is fool hardy to play smart without being clever.  His exact words were “Playing smart, not being clever”.  This is the only apt way to describe the deceit perpetrated on the Rochas Road Revolution contractors by the Imo Government.

It is written that Imo must be better, but how can Imo be truely better through official fraud and deceit?  We must all therefore join hands and ensure that Imo is quickly returned back to the hands of God.

BY: DR. K. C. OKPALAEKE

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