Wednesday, July 6, 2022

BMC caught in a web of lawsuits

The Botswana Meat Commission (BMC) is facing a number of lawsuits from cattle feed and livestock producers seeking to claim millions of Pula from the ailing parastatal.

The lawsuits were filed by Feedmaster Botswana Limited and some famers who had sold BMC cattle whose meat was recalled from European Union (EU) as it was later found to contain antibiotics called salinomycin that enhance fast growth of an animal.

The first suit will be heard before High Court judge, Justice Abednego Tafa on 1st March.
BMC is being sued by Feedmaster Botswana for a debt and damages as result of a breach by the BMC of its contractual duties.

In the first claim, Feedmaster Botswana is demanding that BMC pays the sum of P3, 263, 639.50 plus 10 percent interest.

The livestock feed producing company states that during or about August 2012 and in accordance with trade usage, duly represented by Jonathan Smith, sold and delivered 522 head of cattle to BMC for the sum of P3, 326, 639,50.

Feedmaster Botswana reveals that, despite demand and despite BMC having accepted that it is liable to Feedmaster Botswana in the said amount, the defendant alleges that it has a counterclaim.
BMC has failed and neglected to pay the said amount.

In the second claim, Feedmaster Botswana is demanding P5 606 640, P1 500 000 and interest rate of 10 percent from BMC. The company states that in accordance with the trade usage, it attended at the BMC premises on 29th October 2012 and applied for quota allocation for 5500 head of cattle for November and to 19 December; as usual there was no discussion concerning price because of the published applicable price structure.

“The quota allocations were dully granted for 3090 head for November and further application was made for 2410 for December demonstrating that the Defendant had capacity to purchase and slaughter the cattle offered to it for sale,” states Feedmaster Botswana.

In breach of its duties, Feedmaster Botswana states that BMC, through its Manager of Cattle Procurement, Clive Marshall, telephoned Feedmaster Botswana, represented by Smith, and advised the latter that the quota had been cancelled.

It has since emerged that the reason proffered for such cancellation was that Feedmaster Botswana had not agreed to a settlement proposal for an earlier dispute through its Attorneys Collins and Newman Company, whose proposal was not acceptable to Feedmaster Botswana, with the livestock feed producer regarded as what it called extortionate.

In order to mitigate the further damages that would arise if the livestock offered to the BMC as not slaughtered at the appropriate time, before December 2012, because of it becoming too fat and beef produced thereof being downgraded as well, the ongoing feeding costs, BMC has and will continue to sell its livestock for prices below those that would apply in terms of the applicable price structure.

As at the close of business on Friday 9 November 2012, BMC has suffered damages in the amount of approximately P285 600, being the difference between the price per kilogram which Feedmaster Botswana would have obtained if BMC had not breached its obligations and paid in terms of the applicable price structure and the amount it has now obtained by selling in mitigation of its damages.

In an interview, senior partner at Collins and Newman law firm, Parks Tafa, confirmed that they were representing BMC in the matter.

He would neither confirm nor deny that they were also handling another case from aggrieved farmers who had sold cattle to BMC that was later recalled from EU, saying, “I have been away for a while and I’m only aware of the matter between BMC and Feedmaster Botswana.”

But Sunday Standard can reveal that BMC has also instructed Collins and Newman law firm to institute a counterclaim against the farmers in question and that they bear costs for the recalled beef from Europe that was found to contain antibiotics last year.

It is understood that the famers took the legal action after the Commission refused to pay the whole amount for the cattle that the famers had sold to BMC. The BMC was supposed to have paid the farmers P13 million but instead only paid P10 million in lieu of the costs it incurred as a result of the recalled EU meat.

But BMC reportedly turned tables and countered the suit demanding that the farmers pay for the loss of P22 million that the Commission incurred as a result of the consignment that was recalled from the EU.

The Ghanzi Farmers Beef Farmers Association is also threatening legal action against BMC over the Livestock Purchase Agreement Form, arguing that they were not consulted when it was drafted
Feedmaster Botswana was represented by Armstrong Attorneys.


Read this week's paper