Principal Secretary of Energy, Tankiso Phapano, who is allegedly extremely corrupt, has suffered a legal setback after the High Court sitting in Leribe declined to hear the Ministry’s case against Phaks Joint Venture, the contractor at the centre of a controversial energy project.
In a judgment delivered on 4 November 2025, Justice Mokhoro ruled that the High Court has no jurisdiction to hear the matter, since the original contract between the parties contains a binding arbitration clause. The court dismissed the government’s application with costs, saying the Ministry of Energy should have triggered arbitration when the dispute first arose.
The case, numbered CCA/0006/2025ND, was brought by the Principal Secretary of Energy, the Minister of Energy, and the Attorney General against Phaks Joint Venture. The Ministry had asked the court to intervene following disagreements over a terminated contract, but the judge said the law was clear, the dispute should go through arbitration, not litigation.
According to the ruling, an addendum known as “TP 5” confirmed that the original contract remained binding, including the clause that requires disputes to be settled through arbitration. Justice Mokhoro cited Section 4 of the Arbitration Act No. 12 of 1980, which gives courts only limited powers in matters where parties have agreed to arbitrate. The court, she said, could not step in because the Ministry had not followed the prescribed arbitration process.
The order was brief but decisive:
• The court declines jurisdiction.
• The application is dismissed with costs.
Full reasons, the judge noted, would follow later.
The ruling effectively sends the dispute back to the arbitration table, giving Phaks JV breathing space and forcing the Energy Ministry to start over through a slower, procedural route. For Principal Secretary Phapano Phakoe, it is a major blow in an already complicated saga surrounding government infrastructure contracts.
The project in question, sources familiar with the matter say, is part of the government’s energy-access programme in the northern districts. It has been dogged by delays, ballooning costs, and allegations of irregular payments. Investigators at the Directorate on Corruption and Economic Offences (DCEO) are said to be probing more than M128 million paid to Phaks JV for works that remain incomplete.
The Ministry’s failed bid to bypass arbitration suggests poor coordination and legal oversight within government procurement processes. Analysts argue that if the contract had been properly managed from the start, the state would not now be entangled in procedural technicalities that prolong accountability.
For Phaks JV, the court’s decision is a procedural victory. It buys time, strengthens its negotiating position, and underscores the power of arbitration clauses in shielding private contractors from immediate court action. For government, it’s a reminder that contracts are not just paperwork, they’re binding instruments that can turn against you if you ignore their fine print.
The High Court’s refusal to hear the matter also highlights the weaknesses in Lesotho’s dispute-resolution framework. While arbitration is meant to ensure speedy and expert resolution, in practice it can take years and drain public funds. And in cases involving taxpayer money, delays often mean the public loses twice — first through failed projects, and again through costly legal processes.
As the Ministry weighs its next steps, all eyes will be on how PS Phapano Phakoe handles the fallout. Whether he pushes for arbitration or seeks a negotiated settlement, one thing is clear: the Energy Ministry’s fight with Phaks JV is far from over. The courtroom door may be closed for now, but the spotlight on the Ministry’s handling of multimillion-maloti contracts is only getting brighter.
