The majority of Walvis Bay councillors have resolved to nullify the motion to terminate its contract with Red Force Debt Management.
The decision was taken at a special council meeting on 27 June, attended by nine councillors.
Deputy Mayor Sara Mutondoka proposed that the motion be nullified, and the majority of the councillors supported her.
It is alleged that the motion to end Red Forces' services, tabled by councillor Ephraim Shozi in April, was not submitted on time, and it was also not referred to the management committee as per the standing rules.
According to the administrators, any motion with legal and financial implications is supposed to be referred to the committee before it comes back to the council, but that process was not followed.
Meanwhile, the municipality has denied claims that it blocked information needed to conclude the Red Force investigation.
According to a statement, the council says full cooperation was given to its former lawyer, Richard Metcalfe, from the onset.
In response, Metcalfe described the statement as childish and self-serving.
Metcalfe says his firm cannot continue representing a client who refuses to comply with the Local Authorities Act, the Public Procurement Act, as well as its own Credit Control Policy.
He said the six councillors who withdrew the motion realised that if illegality is established in the appointment of the Red Force, then all services of the Red Force will be terminated.
Metcalfe repeated his sentiments that the appointment of the debt collector was not done in accordance with the law.
He says if the councillors and acting CEO wish to overlook such a violation of the law that was brought to their attention, then that is an issue they need to explain to the residents of Walvis Bay.
Preliminary findings from an investigation by Metcalfe have revealed that the contract with Red Force was awarded without a council resolution.
The municipality administrators have refused to comment on the legality of the contract, saying the matter is before the high court.