M/S JHK Construction Company Vs PDA

\ PESHAWAR HIGH COART, PESHAWAR

FORM OF ORDER SHEET

Datc of Order of Order or othcr Procccdings with Signrture ofJudgc. Procccdlnca

I 2

ORDER l{rit Petition No.1 9 61-P/2021 09.{o.1fir4

Present Mr. Isaac Ali Advocate, Qazi, for lv0s JHK Constuction Company, petitioner.

S. M. ATTIOUE SHAH. J..Petitioner-company, through instant writ petition, has asked for the issuance of an appropriate writ declaring that the letter 05.09.2024 of the Director General, PDA / Employer being nullity in the eye of law is of no legal effect whatsoever whereby its contract of employment of construction has been terminated under sub-Clause 15.2(a) & (b) of the Contract Agreement. The petitioner-company has also asked for the issuance of an appropriate writ directing the respondents to allow it to complete the contract with enhanced rates with which the remaining work is rendered.

2.Brief but relevant facts of the case are that petitioner is the construction company while a contract agreement between it and the Peshawar Development Authority was inked on 19ft July,202l to carry out the construction work which was de-scoped from main contract of Contract No."ICB/PSBRTC-PDA-

CWPaclage-I Proctnement of Civil Works for Ghora

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Qabristan (Post Aman Chowk) to Cancer Hospital (Hayatabad), Km 0+000 to 11+730.172 KM (Package I, Lot II, Reach III)" and the assigned contract was to be completed within 240 days but somehow, dispute arose between the parties over non-completion of the construction work within the stipulated period by the petitioner as well as non-payment of pending / outstanding bills to it by the respondents, hence, the petitioner served the respondents with a notice of termination on 18.08.2024 under sub clause 16.2 (d) of the Contract Agreement, however, no heed was paid to the same rather the respondent / employer served the petitioner with a notice of termination on 05.09.2024 under sub-Clause 15.2(a) & (b) of the Contract Agreement, which prompted the petitioner to file the instant writ petition.

3.Heard. Record perused.

4.Actually, in the case in hand, the perfbrmance of contractual obligations of the ibid contract agreement on behalf of both the parties is involved.

On one hand, the petitioner having some dispute over the non-payment of its outstanding bills by the respondent / PDA / employer has served the latter with a notice of termination of the contract on 18.08.2024 as required under sub-clause 16.2 (d) (Termination by

t' Contractor) of substantial failure of the employer to perform obligations while on the other hand, the respondent / PDA / employer also served the petitioner-company with notice of termination of contract on05.09.2024 in terms of sub-clause 15.2 (a) & (b) (Termination by Employer). All these sub- clauses are reproduced herein blow for the ease of reference:-

16.2 (Termkation by Conbactor) The Contractor shall be entitled to terminote the Contract if:

(d)the Employer substantially fails to perform his obligations under the Contract in such msnner as to materially and adversely alfect the economic balance to the Contract qnd / or the ability of the Contract to perform the Contract.

15.(Termination by Employer)

The Employer shqll be entitled to terminate the Contract if the Contractor:

(a)fails to comply with Sub-Clause 4.2 [Performance SecurityJ or with a notice under Sub-Clquse l5.l Q{otice to CorrectJ.

(b)abandons the Works or otherwise plainly demonstrates the intention not to continue performance of his obligations under the Contract.

5.Here, we have before us the Contract Agreement, so executed between the parties on

19.07 .2021. Sub-clause 20.2 thereof provides a proper mechanism of appointment of Dispute Board and disputes are to be referred to it for decision in accordance with Sub-clause 20.4 relating to "Obtaining Dispute Board's Decision" which itself provides that if a dispute, of any kind whatsoever, arises between the parties in connection with, or arising out of, the contract of the execution of the works, including any dispute as to any certificate, determination, instruction, opinion or valuation of the Engineer, in that event, either party may refer the dispute in writing to the Dispute Board for its decision, with copies to the other party and the Engineer while the Dispute Board, after receiving such reference, within 84 days, would decide the same, which decision would be binding on both the parties and in case, either party is dissatisfied with the same, then, it within 28 days after receiving the decision, give a notice of dissatisfaction to the other parly indicating its dissatisfaction and intention to commence arbitration and if the Dispute Board has given the decision as to a matter in dispute to both the parties, and no notice ofdissatisfaction has been given by either party within 28 days after it received the DB's decision, then the decision shall become final and binding upon both the parties. After giving notice

of dissatisfaction in terms of the ibid sub-clause, both the parties are to attempt to settle the dispute amicably in terms of sub-clause 20.5 before the commencement of arbitration as required under sub-clause 20.6, which provides that any dispute between the parties arising out of or in connection with the contract not settled amicably in accordance with ibid sub-clause 20.5 and in respect of which the Dispute Board decision has not become final and binding shall be finally settle by arbitration.

6.Now coming to the crucial point as to whether in presence of a proper mechanism qua resolving the dispute, so arrived at between the parties, this court can embark upon such like matter while exercising its jurisdiction under Article 199 of the Constitution of the Islamic Republic of Pakistan, 1973. Determination of issues arising out of the contractual obligations entered between the petitioner-contractor and respondents-department cannot be gone into in constitutional jurisdiction of this Court until and unless impugred order or action of the respondents is based on mala fide, blatantly absurd and a$itrary and against the principles of transparency and the same do not have any contentious contested questions of fact and the matter can be determinable from the record of the case. With respect to alleging mala fide, the

petitioner has to firstly allege the mala fide against an individual and secondly has to show from the record, without there being any need to recording evidence, that the individual against whom mala fide has been alleged has in fact committed the same. In a situation, where the mala fide cannot be proved from the record, then the need for recording of evidence comes in and in such eventuality the petition cannot proceed in constitutional jurisdiction. The routine contractual disputes between private parties and public functionaries are not open to scrutiny under constitutional jurisdiction especially in the circumstances when there is no allegation of ill will or mala fide of public functionaries. Any violation of a contract or failure to abide by the terms and conditions mentioned therein or to honour obligations arising out of an agreement cannot be decided in exercise of constitutional jurisdiction and such controversies are to be resolved by approaching the appropriate forums provided by law. If in every contractual matter, giving rise to enforcement of contractual obligations or a dispute which can be redressed through remedy available under the law, writ petitions are entertained, then this would defeat the very purpose of law under which competent courts are established and vested with jurisdiction under the law. It means that when the

agreement itself provides a forum for resolving a dispute arnongst the parties, then in that event, without availing such forum how a disputed question of fact can be placed before the High Court for its resolution.

A High Court under Article 199 of the Constitution of Pakistan 1973 may issue a writ only when facts are admitted and when there is no altemate remedy to the aggrieved person for resolution ofhis grievance. Here in this case neither facts of the case are admitted nor the petitioner-company is divested of alternate forum for the resolution of its grievance as the agreement itself provides it a forum to settle its dispute with the respondents. The august apex court in the case reported as Messrc Sorint Oil and Gas Services Pakistan FZC, Islamabad ys. Oil and Grls Develooment Comoanv Limited (OGDCD, Islamabod Q021 SCMR 117 has refrained the Hi ch Courts in interference in contractual matters in the following manner:-

10.The High Court's jurisdiction under Article 199 of the Constitution may also not be invoked when contracts hqve to be interpreted, and all the more so when they are technical and/or complex, as in the instant cqse, nor when evidence is required to be recorded. In the exercise of its writ jurisdiction, under Article 199 of the Constitution, a High Court also does not enter into the realm ofdisputedfacts.

\ 7 In th e case in hand, almost all the assertions, made by the petitioner-company, in the petition and agitated at the bar, are arising out ofthe factual aspect of the case, which indeed cannot be decided while hearing a petition under Article 199 of the Constitution of the Islamic Republic of Pakistan, 1973 being neither permissible nor desirable under the law.

Certainly, role of the High Court while exercising extraordinary constitutional jurisdiction is limited only to the extent of correcting jurisdictional errors or for that matter procedural improprieties / irregularities just to ensure the proper administration of justice.

Meaning thereby, that interference of this court in its constitutional jurisdiction cannot be asked as a rule rather at best it would be an exception applicable and acceptable on limited occasions and grounds in an appropriate case.

8.Though the leamed counsel for the petitioner- company while relying the judgments of the superior courts reported as Messrs Airoort Suooort Service vs.

The Airoort Manoser. Ouaid- e-Azmn I nt er n ol io n al Airuort. Karach i & others (1998 SCMR 226$ and Constructors Associalion of Pakistan throush Secretarv General & others vs. Government of Balochistan throush,Se crelarv. Communiculion Deoartnent. Ouetta& otherc (PLD 2021 Balochistan

t 2J)has tried his level best to make out a case for the interference of this court through his elaborate arguments insofar as the maintainability of the instant writ petition as well as interference of this court in exercise of its constitutional jurisdiction is concemed but despite hectic efforts he could not succeed in this respect notwithstanding the judgments, so relied by him, are not applicable to the case in hand in the given circumstances of the case. Being so, it can safely be held that this writ petition is not maintainable and is liable to dismissal. Hence, dismissed n limine.

Announced.

09- 10. m24 JU

JUDGE

(saysttus| (D.B) Jusdce S. M. Adlque Shah' HI & Justice Sahtbzada Asadullah, HI