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[2021] ZAWCHC 107
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Bigen Africa Services (Pty) Ltd and Others v City of Cape Town and Others (18681/2020) [2021] ZAWCHC 107 (1 June 2021)

IN THE HIGH COURT OF
SOUTH AFRICA
(WESTERN CAPE DIVISION,
CAPE TOWN)
Case
No: 18681/2020
In the matter between:
BIGEN AFRICA SERVICES
(PTY)
LTD
First
Applicant
ZUTARI (PTY)
LTD
Second
Applicant
INGEROP SOUTH AFRICA
(PTY)
LTD
Third
Applicant
WATER & WASTEWATER
ENGINEERING (PTY) LTD
Fourth
Applicant
PROJECT ASSIGNMENTS
(SA) (PTY)
LTD
Fifth
Applicant
and
THE CITY OF CAPE
TOWN
First
Respondent
THE SPEAKER OF THE
MUNICIPAL COUNCIL
OF THE CITY OF CAPE
TOWN
Second
Respondent
THE MUNICIPAL MANAGER
OF THE CITY OF CAPE TOWN
Third Respondent
KNIGHT-PIESOLD (PTY)
LTD
Fourth
Respondent
AECOM SOUTH AFRICA
(PTY)
LTD
Fifth
Respondent
JG AFRIKA (PTY)
LTD
Sixth
Respondent
GIBB (PTY)
LTD
Seventh
Respondent
IX ENGINEERS (PTY)
LTD
Eight
Respondent
ROYAL HASKONING DHV
(PTY)
LTD
Ninth
Respondent
Coram:
Justice J Cloete
Heard:
11 May 2021
Delivered
electronically:
1 June 2021
JUDGMENT
CLOETE J
:
Introduction
[1]          This matter
has evolved into an opposed legality review between the applicants

and the first to third respondents (“the City”). The
applicants, along with the fourth to ninth respondents, were all

successful bidders for a certain tender 293C for the provision of
multidisciplinary professional services to the City’s Water
and
Sanitation Department (“Department”). The fourth to ninth
respondents have not participated in these proceedings.
[2]          In their
notice of motion the applicants sought, amongst other relief,
the
review and setting aside of the decisions of the City’s Council
on 29 October 2020 to cancel tender 293C and not
to approve the
conclusion of long term contracts with any of the applicants pursuant
thereto.
[3]          It is now
common cause that the City’s “decision” to
“cancel”
tender 293C conveyed to the applicants (and fourth to ninth
respondents) in a letter dated 6 November
2020 was, as
subsequently conceded by the City in its counter-application, an
error, and that in truth what the City’s Council
resolved in
its meeting on 29 October 2020 was to accept a recommendation
not to conclude contracts with them (as well as
the fourth to ninth
respondents).
[4]          The
applicants and the City (“the parties”) now agree that
no
structure within, nor official employed by, the City has cancelled
tender 293C and it therefore stands until set aside, although
the
City submits that the practical effect of the Council’s
resolution of 29 October 2020 was to cancel the tender,
since
that resolution resulted in the tender process not being finalised.
[5]          The reason
for the resolution taken is the inclusion by the City in tender
293C
of what it believes to be a responsiveness (or pre-qualification)
criterion that tenderers have, and indicate in their tenders,
a local
office in the Cape Town municipal area or within 60 kilometres of the
Department’s Head Office in Bellville (“local
office
criterion”).
[6]          In argument
the applicants contended that this criterion did not have
to be met
at the time of tendering, although this is not supported by their own
case in the main founding affidavit where the deponent
stated, with
reference to a later tender which I deal with hereunder, that:
‘
It appears to me as if
the only material difference between the original version of the
local office requirement
[i.e.
in tender 293C]
and
the amended version is that bidders are no longer required to have a
local office as defined
at
the time of tender
.’
[1]
[my emphasis]
[7]          By the date
when the resolution was taken the City considered the local
office
criterion to be a material irregularity inconsistent with s 217(1)
of the Constitution (and various pieces of empowering
legislation and
subsidiary instruments). Section 217(1) provides as follows:
‘
When an organ of state
in the national, provincial or local sphere of government, or any
other institution identified in national
legislation, contracts for
goods or services, it must do so in accordance with a system which is
fair, equitable, transparent,
competitive and cost-effective…’
[8]          The main
application, launched on 11 December 2020, prompted the
City to
bring a counter-application on 15 March 2021 for self-review to
set aside 3 decisions, namely (a) the approval
by its Bid
Specification Committee (“BSC”) on 1 February 2019
of the tender documents for tender 293C; (b) the
advertising of
this tender and tender documents on 8 March 2019; and (c) the
decision by its Bid Adjudication Committee
(“BAC”) on
17 February 2020 to award the tender to the applicants and
fourth to ninth respondents.
[9]          The City
accepts that if the applicants are correct that tender 293C
is not
tainted by the “material irregularity” relied upon, then
it must be implemented (and the process finalised to
implementation).
The parties also agree that the counter-application, if successful,
will render the applicants’ relief moot.
It is for this reason
that the matter evolved into a legality review as opposed to a PAJA
review.
[2]
However they differ on the implications thereof for purposes of
determining this matter.
[10]       The last-mentioned requires
explanation. The applicants accept that the relief sought
in the
City’s counter-application pertains to decisions which pre-date
the Council resolution which they seek to impugn.
It is settled law
that acts performed on the assumption of validity of a prior act (or
decision) are rendered invalid when that
prior act (or decision) is
set aside:
Seale
[3]
,
and that this would have the “domino effect” that the
impugned resolution will also be set aside. oeHow
[11]       However the applicants’
stance is that this should be disregarded in considering
the issue of
whether the City is guilty of unreasonable delay in launching the
counter-application for self-review, whereas the
City’s stance
is that the whole debate about whether there has been an unreasonable
delay is a pointless exercise, given
that the core issue – i.e.
whether the inclusion of the local office criterion in tender 293C
amounts to a material irregularity
– is raised in both the main
and counter-applications, and is indeed now the only real issue for
decision in each of them.
[12]       It is common cause that on
the same day the applicants were notified of the Council’s

resolution, i.e. 6 November 2020, the City advertised a new
tender for the same services (“194C”) which dealt

differently with the local office criterion (there are some other
differences but they are not relevant for present purposes).
[13]       The tender process for
tender 194C is at an advanced stage and the City previously gave
an
undertaking not to award it before 17 May 2021 (6 days
after this matter was heard), although once awarded it will

nevertheless be subject to the same internal appeal process under
s 62 of the Systems Act
[4]
(which may be lodged within 21 days of date of notification of the
BAC’s decision) and the processes prescribed in s 33
of
the Local Government: Municipal Finance Management Act (“MFMA”)
which the City estimates should take a further 60
days thereafter,
concluding in about August 2021.
[5]
[14]       I deal further with this
below, but in their notice of motion the applicants also sought
an
interdict against the City to prevent it from awarding tender 194C,
evidently directed also at the duration of any subsequent
appeal
process following this Court’s decision. As the deponent to the
main founding affidavit put it:
[6]
‘…
that no award
be made pursuant to tender 194C unless and until the Council’s
cancellation of tender 293C has been upheld by
this honourable court
or by a higher court of competent jurisdiction on appeal.’
[15]       To all of this must be added
that, given the situation in which it presently finds itself,
the
City is continuing with limited “stop gap” contracts with
successful bidders of tender 35C previously awarded on
20 March
2017, on a month-to-month basis expiring on 30 September 2021,
since tender 293C was intended as the replacement
for tender 35C (as
is now tender 194C).
Issues
for determination
[16]       In the main founding
affidavit the applicants raised six grounds of review under s 6

of PAJA.
[7]
In addition to five ancillary ones, their main ground was that the
local office criterion is not a responsiveness (or pre-qualification)

requirement, but may rather be complied with by a successful bidder
upon commencement of contract (i.e. as part of the functionality

assessment); is therefore not a material irregularity; and hence the
resolution of 29 October 2020 is vitiated by a material
mistake
of law.
[17]       Given the City’s
concession that tender 293C has not been cancelled, the applicants

only persist with their main ground plus a related one, namely that
even if the local office criterion is responsive, its inclusion
in
the tender document is not unconstitutional and unlawful, since the
City may condone non-compliance, provided that the bidder
gives an
undertaking to have a local office in place if awarded the tender.
[18]       During the hearing on 11 May
2021 there was some debate about the duration of the interdict
sought
by the applicants. This resulted in the City providing the following
revised undertaking:
‘
On the basis that:
(1)
the applicants are
no longer seeking any interim relief pending the judgment of this
Court and pending the final determination of
any appeals against this
Court’s judgment; and
(2)
the applicants are
seeking a final interdict in terms of paragraph 5 of the notice
of motion, with everything after the date
of 6 November 2020
being deleted;
(a)
in due course the
BAC will take an unconditional decision regarding the award of Tender
194C; and
(b)
the successful
(and unsuccessful) tenderers will be informed, in the letters from
the City notifying them of the BAC’s decision,
that, in
addition to the BAC’s award being subject to the outcome of the
Systems Act section 62 process and the MFMA section
33 process, the
final outcome of the present proceedings, in which the applicants are
seeking an order restraining the City “from
making any award
pursuant to, and from taking any steps in furtherance of, its
invitation to tender no 194C/2020/2021 dated 6 November
2020”,
may impact on the award of the tender to the successful tenderers.’
[19]       On 25 May 2021 the
applicants responded as follows:
‘
In light of the
undertaking given by the City in the email from its legal
representatives on 11 May
2021 (attached) that it will notify the bidders for Tender 194C that
the outcome of that bid may be impacted
upon by the court proceedings
– which includes an interdictory element – the relief
that the applicants seek in prayer
5 of the Notice of Motion is
amended to read as follows –
“
5
An order restraining the first, second and third respondents from
making any award
pursuant to, and from taking any other steps in
furtherance of, its invitation to tender no 194C/2020/2021 dated 6
November 2020.”
’
[20]       Accordingly the issues for
determination are the following:
20.1    Whether the local office criterion in tender
293C is a responsiveness requirement which had to be complied
with by
bidders at the time of tendering in order for their tenders to be
declared responsive;
20.2    If so, whether its inclusion rendered tender
293C unconstitutional and unlawful (to which the issue of the
City
being entitled to grant condonation is linked); and
20.3    The revised interdictory relief, which will
only require consideration should the City be unsuccessful (or
the
applicants successful) in the main relief.
[21]       Before dealing with the
relevant facts, which are largely common cause, it is convenient
to
set out the established approach to reviews of this nature in
circumstances where, as the applicants maintain, the City has

unreasonably delayed in bringing its counter-application.
Approach
to delay in legality self-review
[22]       I will refer to the
relatively recent decision of the Constitutional Court in
Buffalo
City Metropolitan Municipality v Asla Construction (Pty) Ltd
[8]
(“Asla”) where the approach was set out. It is a three
stage enquiry.
[23]       First, it must be determined
whether the delay was unreasonable, which is a factual enquiry

involving a value judgment.
[9]
Second, if the delay was unreasonable, whether the City has provided
a satisfactory explanation for the delay (which must cover
the entire
period of the delay).
[10]
Third, if the delay was unreasonable and no satisfactory explanation
has been provided, whether the delay should be overlooked,
which is a
flexible approach.
[11]
This involves a legal evaluation taking the following factors into
account:
23.1    The potential prejudice to affected parties as
well as the possible consequences of setting aside the impugned

decision;
[12]
23.2    The nature of the impugned decision, which
involves a consideration of the merits of the legal challenge
against
that decision, and in this regard the nature and extent of the
illegality may be a crucial factor;
[13]
and
23.3     The conduct of the applicant
concerned (in this case the City), particularly for State litigants

because they are often best placed to explain the delay and are
subject to a higher duty to respect the law and rectify unlawful

decisions.
[14]
However even if a functionary has not acted as a “model
litigant” or “constitutional citizen” there may
be
a basis to overlook the delay if the functionary acted in good faith
or with the intent to ensure clean governance.
[15]
[24]       There is a further
“catch-all” consideration, namely that even where there

is no other basis to overlook the unreasonable delay, if the conduct
is unlawful the court is constitutionally bound to declare
it to be
so, since s 172(1)(a) of the Constitution enjoins it to declare
invalid any law or conduct that it finds to be inconsistent
therewith
(the ‘
Gijima principle’
).
[16]
Factual
background
[25]       The Department makes
extensive use of contracted professional services to support and

implement its projects, through framework contracts in terms of which
service providers are called upon to provide professional
services as
and when required. These professional services are linked to, and
support, the Department’s planning, design
and implementation
of construction contracts which are essential to the fulfilment of
the City’s developmental objectives.
[26]       It is the Department which
drives the process of formulating tender specifications for
approval
by the City’s BSC, evaluating tender bids and making
recommendations regarding their award to the City’s BEC
and,
through the BEC, to the City’s BAC. In doing so, the Department
in turn receives advice from the City’s Supply
Chain Management
department (“SCM”) and makes use of templates which the
SCM updates from time to time.
[27]       During 2016 the Department
wished to contract for the provision of specialised, professional

multidisciplinary services to it across four branches: Bulk Water,
Engineering and Asset Management, Reticulation, and Wastewater

Treatment.
[28]       This tender was number 35C.
Its specifications were formulated based on two SCM templates,
namely
SCM 515: CIDB (Construction Industry Development Board) Professional
Services Tender, and SCM 518: Term Tender for Civil
WTA Type
Framework. The SCM 515 template for professional services included a
local office requirement, namely that ‘
tenderers must have
an office in the Cape Town Municipal area’.
[29]       The Department supported the
inclusion of a local office requirement into the tender documents
for
tender 35C. Because it was not necessary for the office to be within
the Cape Metropole, provided it was within an easy travelling

distance, the local office requirement permitted bidders to specify a
local office within a 60 kilometre radius of the Cape Town
Civic
Centre, which would accommodate prospective bidders in areas outside
the Cape Metropole such as Paarl and Stellenbosch.
[30]       In addition, clause
F.2.1.1.3 of the tender document for tender 35C included a provision

that ‘
Key personnel will be expected to operate out of the
local office, as the exigencies of this project require’.
[31]       The Department’s
reasons for including these provisions were the following. First,

having contractors’ key professional staff available at a local
office makes them easily accessible to the City and other
service
providers and facilitates regular interaction and stakeholders
meetings. Prior to the Covid-19 pandemic almost all meetings
about
the Department’s projects took place in person and often
included representatives of contractors appointed under the

construction contracts linked to the tender 35C contracts.
[32]       Second, a local office in or
close to the City shortens response times and permits urgent
meetings
in the case of incidents such as pipe bursts or water treatment
process problems. Third, a local office requirement of
this sort
means consultants’ senior representatives, and not only key
professional staff, will be available to the City for
face-to-face
meetings in the vicinity of the City’s offices. Fourth,
secondment of City staff to consultants’ local
offices for
training is a part of the motivation for contracting with
professional service providers and supports valuable skills
transfer.
Finally, the professional services tendered for require an ongoing
local presence in order to implement the linked construction

contracts.
[33]       The applicants go further
and assert that it is also desirable for the City to contract
with a
local consultant(s) with a permanent local presence, because they are
familiar with local conditions, rules and regulations.
While the City
accepts that local consultants probably need not acclimatise to local
conditions etc, it disagrees that this is
sufficient reason to favour
local consultants to the exclusion of prospective bidders from
elsewhere since, where local conditions,
rules and regulations pose a
particular challenge, this will be reflected in the tender
specifications and can be achieved in various
ways as set out in the
City’s papers.
[34]       On 12 August 2016 tender 35C
was advertised and following the usual evaluation and adjudication

processes was awarded on 20 March 2017. Consequent upon the
award of tender 35C the City concluded eight framework contracts,
one
for a primary service provider and one for a standby service provider
for each of the four branches. The professional services
rendered in
terms of tender 35C contracts have been, and remain, of utmost
importance to the Department.
[35]       The tender 35C contracts
commenced during the period 24 April 2017 to 7July 2017,
and
were initially to run until 30 June 2019. Due to the issues
which have arisen about tender 293C, the 35C contracts have
had to be
extended several times and, as previously stated, are currently
operating on a month-to-month basis until 30 September
2021.
[36]       Also as previously stated,
tender 293C was to be the replacement for tender 35C. It was
to be
wider in scope, amongst other things because it included framework
contracts for professional services to a fifth branch
in the
Department, the Catchment Stormwater and River Management Branch.
Moreover it was determined from the outset to run for
a period
exceeding three years, rather than being extended on an
ad hoc
basis, which is important for good governance of the City’s
contracts.
[37]       The specifications for
tender 293C were considered and approved by the BSC on 1 February

2019. By that time the SCM 515 template had been updated, and the
local office criterion (which in the template itself restricted

potential bidders to the Cape Metropole only) had been removed.
[38]       Despite the removal of the
local office criterion from the template, the BSC nevertheless

decided to include it (as amplified) in the specifications for tender
293C in the same terms as those in tender 35C. The reason
for this
was because, based on its experience in tender 35C, the Department
was, and remains, of the view that having a local office
is a
practical necessity for the effective implementation of the
professional services to be provided.
[39]       The local office requirement
in tender 293C is contained in clause F.2.1.4.5 and reads
as follows:
‘
F.2.1.4.5
Local office
In
order to be considered for an appointment in terms of this tender,
tenderers must have an office in the Cape Town Municipal area
or
within a radius of 60 km from the Water and Sanitation Head
Office, Bellville. All communication with the employer will
flow
through the local office where the majority of work in terms of this
tender will be carried out. The address of the local
office must be
indicated on Schedule 1, Part T2.2: Returnable Schedules, and which
will be regarded as the domicilium citandi et
executandi for the
purposes of any contract arising from this tender submission.’
[40]       Other salient elements of
tender 293C included the following. First, in respect of each
branch,
one successful bidder would be appointed as “Winner”, and
a further two successful bidders would be appointed
as “Standby
Service Provider No.1” and “Standby Service Provider
No.2”. Second, services would be rendered
“as and when
required” and the City would thus have available to it a
competitive choice of panellists for the provision
of such services
at favourable rates.
[41]       Third, the contract period
was to be 60 months. This means that the award of the tender
was
subject to the additional requirements imposed by s 33 of the
MFMA as is stated at the beginning of the tender document
on page 2
under ‘
General Tender Information’
. Fourth, in
addition to the local office criterion, key personnel as identified
in the tender document would be required to ‘
operate out of
the local office, as the exigencies of this project require’
.
[42]       Tender 293C was advertised
on 8 March 2019 and closed on 18 April 2019. Thirty-four

bids were received by the closing date. The BEC included officials
from across the Department’s various branches as well
as the
required SCM representative. The BEC evaluated bids against the
criteria in clause F.2.1.4 which commences with ‘
Only those
tenderers that satisfy the following criteria will be declared
responsive’.
Two tenderers submitted bids without providing
details of a local office, but were declared non-responsive for other
reasons and
according to the City this criterion (which as is
apparent from the clause number in the tender document falls under
F.2.1.4) was
not an issue in their evaluation at all.
[43]       Tender 293C elicited an
unusually large number of bids. To ensure continuity of service

delivery while the evaluation and adjudication processes were
underway, on 18 June 2019 the BAC extended the tender 35C
contracts
by about six months each, to 30 December 2019. While
the Department continued with evaluation of tender 293C, in the
latter
half of 2019 the Auditor-General of South Africa (“AGSA”)
commenced with its annual audit of the City which is required
under
the MFMA. The AGSA conducts a range of audits, including financial
audits and those for regulatory and legal compliance.
The AGSA’s
findings are compiled into a management report which is tabled in the
City’s Council. Every year the AGSA’s
audit report spans
hundreds of matters, across all the City’s departments.
[44]       Typically, the AGSA’s
investigation into a particular matter commences with a written

Request for Information (“RFI”), in which it raises the
audit team’s preliminary concerns in the form of a
“communication
of audit findings” (“COMAF”).
A RFI is directed to a particular directorate or department within
the City, which
is asked to respond to the preliminary findings
within seven days. In the audit for the 2018/2019 audit cycle (for
the year ending
30 June 2019) a total of 42 COMAFs were raised
in the City’s SCM and contract management environment. One of
these was
COMAF 29.
[45]       On 28 October 2019 the
AGSA’s audit team addressed a RFI to the SCM to advise of
a
potential adverse audit finding in respect of a particular tender,
namely 072Q, for ‘
The Construction of the New Retreat Low
Lift Sewer Pump Station and Refurbishment of Existing Outfall Gravity
Sewer with Associated
Civil and Demolition Works Cape Town’.
The AGSA’s concern was that the inclusion in the tender
document of a local office requirement in the form of a
responsiveness
criterion resulted in the tender being biased in
favour of bidders in the local area, and thus anti-competitive
because it excluded
potential bidders from outside it. The AGSA’s
preliminary conclusion was that:
‘
The
restrictive requirement (fully functional office within 150km from
the site) for non-responsiveness limited the participation
in the
tender as more bidders could have considered submitting offers if the
responsiveness criteria did not indicate that bidders
will be
assessed as non-responsive if a bidder holds office further than
150km from the site…
The
criteria to disqualify a bidder in terms of a “local office”
is limiting the market and as such considered unfair
tender practice
in terms of the requirements of section 112 of the MFMA and
consequently results in non-compliance.’
[46]       After obtaining input from
the responsible official, who provided the rationale for the

inclusion of the local office requirement in tender 072Q, the SCM
responded to the AGSA on 4 November 2019. It set out the

rationale and sought to persuade the AGSA to change its preliminary
finding, advising that tender 072Q ‘…
was therefore
structured in such a way to prevent non-compliance with environmental
legislation and to provide for a fully functioning
local office for
the execution of the contract’.
[47]       The audit team did not
accept the SCM’s response. On 26 November 2019 it
furnished
the City Manager with its draft management report. In
relation to COMAF 29, the audit team did not dispute the explanation
put
up by the City justifying the need for a local office, but
distinguished between the local office being used as a responsiveness

criterion and its forming part of a functionality assessment of the
bid. The AGSA found that the latter would be acceptable, but
not the
former. In reaching this conclusion the AGSA relied on s 217(1)
of the Constitution, s 112(1) of the MFMA and
regulation 27(2)
of the SCM regulations.
[17]
The AGSA thus further found that all expenditure incurred by the City
pursuant to tender 072Q would be regarded as irregular and
had to be
disclosed accordingly.
[48]       On 6 December 2019 the
Director: SCM, Mr Basil Chinasamy, and the Director: Treasury,
Mr
David Valentine, met with the audit team to discuss, among other SCM
matters, the audit finding in COMAF 29. Following a debate,
both
accepted the finding and committed the City to implementing
corrective measures in relation to ‘
biased tender
specifications which contravened the SCM Regulations’.
[49]       Unaware of the engagement
between the SCM, City Treasury and the AGSA, the BEC had continued

with its evaluation of tender 293C. On 2 December 2019 it
finalised a report to the BAC wherein it recommended ten preferred

bidders, namely the applicants and fourth to ninth respondents, for
further negotiations on rates and percentages that had been

identified as not market-related. The report did not discuss the
local office requirement because none of the preferred bidders
had
been disqualified on this basis (in other words, all had a local
office).
[50]       On 9 December 2019 the
BAC met to consider the report, which formed the sole basis
for its
decision (i.e. the BAC was not furnished with any source or other
documents relating to tender 293C). The BAC’s chairperson
was
Mr Arno Vorster. After considering the report, the BAC resolved
to authorise each of the five branches to negotiate with
the
identified preferred bidders on price as recommended. On the same day
the BAC further extended the tender 35C contracts to
30 September
2020, since it was anticipated as the date by which the s 33
process required for the tender 293C contracts
would be completed. On
29 December 2019 the applicants and fourth to ninth respondents
were notified of the BAC’s decision
under the hand of
Chinasamy.
[51]       The applicants complain that
since the notification emanated from Chinasamy who had been
part of
the meeting on 6 December 2019, he should have realised that
tender 293C had a local office criterion like the one
at issue in
COMAF 29. However Chinasamy has explained that it is because of his
position as Director: SCM that notifications of
this nature go out
under his name. He is not personally involved in the evaluation of
tenders, and had no personal knowledge of
the inclusion of the local
office criterion in the tender document for tender 293C at the time
that the preferred bidders were
selected and notified accordingly (on
29 December 2019).
[52]       On 25 January 2020 the
City’s Chief Financial Officer (Mr Kevin Jacoby), Chinasamy
and
other representatives of the City met with those of National
Treasury. The purpose was to discuss, generally, the AGSA’s

findings on SCM matters in the 2018/19 audit and the practical
application of relevant parts of the MFMA and SCM regulations in
the
medium and longer term.
[53]       The final AGSA management
report for the City was signed on 28 January 2020 and the

2018/19 annual report (which includes the AGSA’s audit report
as required by s 121 of the MFMA) was tabled in the Council
on
29 January 2020. One of the issues raised in the audit report
was the “biased” drafting of tender specifications.
In
its management response in terms of s 121(3)(g) the City
undertook to take corrective action in relation to this and other

irregularities identified by the AGSA. The annual report was referred
to the Municipal Public Accounts Committee for consideration.
[54]       During the course of
February and March 2020 further meetings were held between
representatives
of the SCM and City, National and Provincial Treasury
regarding the matters discussed at the meeting on 25 January
2020 and
similar issues. Although the local office criterion was no
longer in contention, the City presented the audit findings to
National
and Provincial Treasury in an effort to obtain clarity or
guidance on appropriate corrective measures to address it.
[55]       Still unaware of these
engagements and difficulties with the local office criterion, on

10 February 2020 (following the successful conclusion of pricing
negotiations), the BEC for tender 293C finalised a report
for
presentation to the BAC, wherein it recommended the award to the
applicants and fourth to ninth respondents at the negotiated
rates.
This report too did not discuss the local office criterion. On
11 February 2020 an independent due diligence report
conducted
by Moore CT Forensic Services was finalised and submitted, which
found no risks flowing from the evaluation of tender
293C.
[56]       Also on 11 February 2020
Valentine’s office circulated by way of an email to the
City
Manager and Executive Directors of the City’s departments, an
executive summary of the final AGSA management report
‘
for
information and further action where needed’
and to
‘
mitigate any reoccurrences’
of the irregularities
found by the AGSA. The recipients were informed that Valentine’s
office was engaged in a process to
disseminate an audit action plan
which, once finalised, would result in the City obtaining input from
amongst others National and
Provincial Treasury ‘
to ensure
that the City addresses the root causes of the findings’.
[57]       The executive summary
included the following, namely ‘
Bid specifications for some
of the tenders were drafted in a biased manner and did not allow all
potential suppliers to offer their
goods or services, in
contravention of SCM regulation 27(2)(a)…’.
Further
internal communications followed on 13, 14 and 17 February 2020, all
of which were largely directed at dissemination of
the information
pertaining, amongst others, to the AGSA’s “biased”
criterion finding. One of the recipients was
Mr Michael Webster,
who from 1 July 2018 to 30 November 2019 was the Director: Water
and Sanitation and since 1 December
2019 has held the position
of Executive Director: Water and Waste.
[58]       According to the City it was
a matter of coincidence that the BAC also met on 17 February

2020 to consider the BEC’s award report (which made no mention
of the local office criterion problem) and the BAC resolved
to award
tender 293C as recommended. According to the City neither the BAC nor
its chairperson (Vorster) were aware at the time
of the award of the
inclusion of the local office criterion in tender 293C and what it
describes as the ‘
potential implications’
of COMAF
29 on its legality.
[59]       The first, second and third
applicants were each awarded “Winner” status and
the
fourth and fifth applicants (together as a joint venture) “Standby
Service Provider No. 2” status. On 25 February
2020 Chinasamy
arranged for a Top 300 project managers meeting, which is attended by
City employees managing the most significant
projects being
undertaken by it. Of the BEC for tender 293C only two members
attended and they were only able to be present some
of the time
because they had other commitments. During the time they were
present, neither recalls any discussion about the local
office
criterion. On 26 February 2020 the applicants (and fourth to
ninth respondents) were notified of the award, subject
to conclusion
of the internal appeal and s 33 processes.
[60]       Over the period 6 March
to 23 July 2020 various steps were taken internally
by the City
for the envisaged corrective action which included communication
between some of its own role players; the applicants
were advised
that no appeals had been received; certain minor amendments to the
draft contracts were proposed and accepted by the
applicants and
other successful bidders; feedback was obtained from National and
Provincial Treasury; and on 6 July 2020 Chinasamy
circulated a
memorandum to all BAC chairpersons, BSC and BEC members,
highlighting, amongst others, the local office criterion
as being
non-compliant. Neither National nor Provincial Treasury objected to
the conclusion of the contracts with the applicants.
However
Provincial Treasury, in its response dated 24 June 2020,
emphasised that contract management of the services ‘
must
give effect to the five pillars of procurement as entrenched in
Section 217 of the Constitution’.
[61]       Arising from Chinasamy’s
memorandum of 6 July 2020 departmental officials who
were
members of the BEC sought clarity, through management channels, about
the implications of the AGSA’s findings on the
local office
criterion for tenders where awards had been made but the contracts
had yet to be signed (including tender 293C). Mr Kevin
Balfour
who is the Head: Infrastructure and Project Implementation in the
Bulk Water Branch and chairperson of both the BSC and
BEC for tender
293C, wrote a memorandum on Webster’s behalf. Balfour stated
that the BEC for tender 293C had received no
direct communication in
this regard. However they had heard that a list had been compiled of
tenders to be cancelled and at least
one department had cancelled a
tender because it contained the local office criterion. The BEC was
therefore uncertain whether
or not tender 293C fell into that
category. Balfour also set out a number of reasons which militated
against its cancellation.
[62]       One of these reasons was the
view (which he presumably shared with Webster) that the local
office
criterion did not limit competition for the reason that prospective
bidders’ tenders would be compliant if they undertook
to open a
local office if successful (this view was of course not shared by the
other relevant City Officials as set out above).
Balfour appealed to
those concerned not to cancel tender 293C since a replacement tender
would not be finalised until approximately
November 2021. With the
35C contracts due to expire in September 2020, the Department would
not have access to necessary professional
services for the whole of
the 2020/2021 municipal financial year and the first 5 months of the
2021/2022 year. This would have
very serious adverse consequences for
the Department’s capital works projects and for service
delivery, which were summarised
in the memorandum and substantiated
in the annexures thereto. A perusal of these annexures
[18]
supports Balfour’s entreaty not to cancel because of the
adverse consequences.
[63]       On 28 July 2020 Webster
consulted Jacoby and met with Chinasamy and Vorster. At the
meeting
it was ultimately concluded that tender 293C could not proceed for
the following reasons. First, the AGSA had found the
local office
requirement in tender 072Q materially irregular and consequently
classified the expenditure under the resulting contract
with the
successful bidder as irregular as well. Second, the City had
subsequently had to cancel multiple projects with similar
clauses.
Third, Council could not be asked to approve contracts that would
give rise to expenditure which would be classified as
irregular in
the next audit. It was also agreed that the process for a replacement
for tender 293C should be run on an expedited
basis, and that the
contracts under tender 35C should be extended before they expired on
30 September 2020. On the same day
Webster informed the heads in
the Department, including Balfour, who in turn informed departmental
officials running tender 293C.
[64]       On 14 August 2020 the
BEC submitted a report to the BAC requesting it to cancel tender
293C
due to a material irregularity in the tender process, i.e. the
inclusion of the local office requirement.
[19]
On 24 August 2020 the BAC met to consider this request. The BAC
was concerned that it did not have the authority to cancel
a tender
after it had been awarded and while the s 33 process was
pending. This was due to the Appeal Unit in the City Manager’s

office having expressed a preliminary view that they were not
convinced the BAC had the authority to cancel tenders in such
circumstances.
The BAC thus resolved to refer the matter back to the
BEC so that clarity could be obtained regarding the BAC’s
authority
to cancel.
[65]       Faced with a sort of
“Hobson’s choice”, on 28 September 2020 the BAC

acceded to the Department’s request to authorise the extension,
on a month-to-month basis until 30 September 2021 at
the latest,
of three sets of framework contracts concluded under tender 35C,
namely Bulk Water, Reticulation and Wastewater Treatment.
This
decision was made so as to ensure the continuation of critical
service delivery, and the BAC accepted the risk that expenditure

incurred pursuant thereto could well be found to be irregular in the
next audit.
[66]       Following a series of
engagements thereafter about how best to handle tender 293C, the

Department, Jacoby and the City’s Legal Office decided to
approach the Executive Mayor and Mayoral Committee (“MAYCO”)

with the request that they recommend to Council that it terminate the
pending s 33 process by resolving not to enter into
long-term
contracts with the applicants (and fourth to ninth respondents). A
report to this effect was prepared and signed on 8 October
2020,
then vetted for legal compliance and signed off on 12 October
2020. The report described the material irregularity as
emanating
from a ‘
recent finding’
by the AGSA.
[67]       On 23 October 2020 the
Executive Mayor and MAYCO resolved to make such a recommendation
to
Council. At its next ordinary meeting on 29 October 2020 the
Council considered the recommendation and resolved to adopt
it. As
previously stated, this recommendation was conveyed to the applicants
(and fourth to ninth respondents) on 6 November 2020.
No proactive
steps were taken thereafter by the City until it launched its
reactive self-review (the counter-application) on 15
March 2021, save
for agreeing to an expedited timetable for the hearing of the matter
after the applicants launched the main application.
Whether the delay was unreasonable
[68]       There is no dispute that,
objectively, the City delayed in launching its counter-application.
A
legality review does not have a predetermined deadline within which
to launch the proceedings but must be brought within a reasonable

time. As with a PAJA review, it is necessary to determine when the
clock starts to run. It is now settled law that the clock starts

running in legality reviews when the applicant (in this case, the
City) became aware of the impugned action or ought reasonably
to have
become aware of it.
[20]
[69]       In
Aurecon (SCA)
[21]
the City (in the court a quo) had brought an application to review
and set aside its own decision to award a tender to Aurecon.
In both
the court a quo and the Supreme Court of Appeal the matter was
approached as a PAJA review, but what is relevant for present

purposes is that the City, in the face of a considerable delay,
argued that it was the date it became aware of the potential
unlawfulness
that mattered. The Supreme Court of Appeal rejected this
interpretation since it:
[22]
‘…
would
automatically entitle every aggrieved applicant to an unqualified
right to institute judicial review only upon gaining knowledge
that a
decision (and its underlying reasons), of which he or she had been
aware all along, was tainted by irregularity, whenever
that might be.
This result is untenable as it disregards the potential prejudice to
the respondent (the appellant here) and the
public interest in the
finality of administrative decisions and the exercise of
administrative functions…’
[70]       In
Asla
it was held
that while the standard to be applied in assessing delay for both
PAJA and legality is whether the delay was unreasonable,
the
assessment is not the same. The distinction lies in the 180-day
period prescribed in PAJA. In
Opposition to Urban Tolling Alliance
(SCA)
[23]
it was found that s 7 thereof creates a presumption that a delay
of longer than 180 days is
per se
unreasonable. In the context
of a legality challenge however, this necessarily involves the
exercise of a broader discretion, since
the 180-day bar in PAJA ‘
does
not play a pronounced role in the context of legality’
.
[24]
[71]       Furthermore in
Aurecon
(CC)
[25]
it was stated that:
‘…
The
City contended that knowledge by the BEC of Aurecon’s
involvement in the pre-feasibility study could not be imputed to
the
BAC and subsequently to the City…
The
SMP
[Supply Chain
Management Policy]
defines
the “City” as “the municipality of the City of Cape
Town or any person(s) or committee delegated with
the authority to
act on its behalf”. The distinction that the City attempts to
draw between what was within its own knowledge
and what is within the
knowledge of its committees is superficial. It is common cause that
the BEC and the BAC are committees mandated
by the City for purposes
of the tender-procurement process. These committees form part of an
internal arrangement by the City.
Accordingly it may reasonably be
expected that all information regarding the tender process which is
within the knowledge of the
BAC or BEC may be deemed to be within the
City’s knowledge. In my view that is a weak attempt by the City
to deny knowledge
of what it ought reasonably to have known.’
[72]       Although in the present case
the factual situation is the reverse (i.e. knowledge by the
City as
opposed to its delegated committees) there seems to be no sound
reason to draw a distinction in the City’s favour.
Accordingly,
applying the principles in the two
Aurecon
cases, the decision
of which the City has been aware all along was the approval on
1 February 2019 by the BEC of the tender
document for tender
293C containing the local office criterion. This is therefore the
date when the clock started to run.
[73]       The City was alerted to the
potential unlawfulness of the local office criterion by the
AGSA
audit team on 28 October 2019. This is thus the date upon which
its committees must be deemed to have been aware of that
potential
unlawfulness.
[74]       It is accepted by the City
that once it became aware of the irregularity which it maintains

vitiated the tender process for tender 293C, it was obliged to act to
correct the unlawfulness within the boundaries of the law
and
interests of justice.
[26]
It also accepts that it had to do so expeditiously. This is because
s 237 of the Constitution makes expeditious and diligent

compliance with constitutional duties an element of legality.
[27]
[75]       However the City argues that
what it was not required to do was to launch ‘
costly and
time-consuming legal proceedings’
in circumstances where it
had the option of solving the matter quickly and cost-effectively
through a “pending” statutory
process, namely s 33
of the MFMA, since it was not, prior to the Council resolution of
29 October 2020,
functus officio
.
[28]
[76]       While it is true that the
applicants did not persist with their challenge to the utilisation
of
the s 33 process for that purpose given the City’s
concession that the tender was never cancelled, I do not see how
this
works in the City’s favour. The fact of the matter is that it
nevertheless took the City from 28 October 2019 to
29 October
2020 (a year) to reach the conclusion that the problem could be
solved by adopting that process.
[77]       It is moreover significant
that the tender awards were made on 17 February 2020 and
the
successful bidders notified on 26 February 2020, which is about
four months after the City was alerted to the potential
unlawfulness
of the local office criterion, and the awards and notifications
themselves pre-dated the commencement of the s 33
process by at
least a month. In addition the City maintained its stance that
self-review was unnecessary until it launched its
counter-application
on 15 March 2021, five months after the later resolution was
taken on 29 October 2020, and despite its
knowledge of the
applicants’ challenge to the adoption of that process as set
out in the main application launched on 11
December 2020.
[78]       Viewed against the
applicable legal principles, these considerations lead me to the
conclusion
that the delay was indeed unreasonable.
Whether the City has provided a
satisfactory explanation for the delay
[79]       As I see it, the fundamental
difficulty which the City faces in this leg of the enquiry
is that
its explanation for the delay only commences on 28 October 2019,
whereas the clock started running on 1 February
2019. There is
thus an unexplained delay of some nine months.
[80]       The Constitutional Court has
made clear that the explanation must cover the entire period
of the
delay.
[29]
Accordingly, even if I were to accept that the City has provided a
satisfactory explanation for the balance of the period in question,

it has failed to meet this threshold.
[81]       No purpose would thus be
served by an assessment of the explanation provided for the period
28
October 2019 until 15 March 2021, and I must conclude that on this
basis the explanation furnished is unsatisfactory.
Whether the delay should be overlooked
[82]       The first issue to consider
is the prejudice to affected parties and the possible consequences
of
setting aside the impugned decision. The nub of the applicants’
argument on this score is that not only they, but also
the City and
ratepayers, will be prejudiced if the delay is overlooked.
[83]       They submit that, apart from
what they consider to be a lengthy delay in finalising tender
194C
(including the internal appeal and s 33 processes), ratepayers
will ultimately have to foot the bill for the extra time
and
resources spent by City officials as a consequence. In addition, the
applicants’ time spent and financial resources utilised
in the
process thus far, as well as their potential revenue, will be wasted.
[84]       The applicants’
frustration is entirely understandable, particularly given the
absence of any suggestion that they have failed to act in good faith
throughout. However to my mind their complaints of prejudice
are
outweighed by the following. First, they have at all times been
aware, and have accepted, that the award to them of tender
293C is
conditional upon a positive outcome of the s 33 process.
[85]       Second, no rights flow from
the submission of a bid, which is something all tenderers
must do on
their own time and expense. Their main significant actions subsequent
to the awards to them (apart from the present
litigation) have been
limited to negotiating on price, minor amendments to the contracts
and corresponding with the City.
[86]       Third, the loss of future
revenue is, as the applicants acknowledge, potential only, since
the
contracts were awarded on an “as and when required” basis
within the context of an ongoing competitive pool of
successful
bidders for the duration of the tender period.
[87]       Fourth, and most
importantly, if the City is correct on the core issue, it will be
unconscionable
for it to be forced to incur irregular expenditure for
a period of 5 years
[30]
(presumably at ratepayers’ ultimate expense). Fifth, City
officials are salaried employees. They will simply have to work

harder and for longer hours.
[88]       Finally, the City agreed to
having the main and counter-applications heard together on
an urgent
basis, since their outcome (subject to any subsequent appeal from
this court’s decision) will determine the future
course of the
process in relation to tender 194C which, if it is to continue, must
in any event be concluded by 30 September 2021.
Having regard to all
of these considerations it is my view that, on the issue of
prejudice, the scales must tip in the City’s
favour. This is
the first reason why the delay should be overlooked.
[89]       The next issue is the core
one, namely unlawfulness of the local office criterion and
if so, its
materiality, which stem from the first impugned decision of the BSC
on 1 February 2019. In
Aurecon (CC)
[31]
it was stated that:
‘…
when
carrying out a legal evaluation a court must, where appropriate, take
into account the materiality of any deviance from legal
requirements,
by linking the question of compliance to the purpose of the
provision.’
[90]       In addition to s 217(1)
of the Constitution, s 112(1) of the MFMA requires,
in
peremptory terms, that when municipalities contract for goods or
services they must do so in accordance with a system and SCM
policy
which is ‘
fair, equitable, transparent, competitive and
cost-effective’.
In turn, regulation 27(2)(a) of the SCM
regulations requires that bid specifications ‘
must be
drafted in an unbiased manner to allow all potential suppliers to
offer their goods or services’.
These requirements are
carried over into the City’s SCM Policy.
[32]
[91]       It is not required of me to
consider the parties’ respective views on the nature
of the
local office criterion, given that interpretation is a matter of law.
I have already quoted clause F.2.1.4.5 containing
the local office
criterion in tender 293C at paragraph 39 of this judgment, and will
thus not repeat it.
[92]       The settled principles
pertaining to the interpretation of documents
[33]
are in essence as follows. The starting point is the language of the
provision itself, read in context and having regard to the
purpose of
the provision and the background to its preparation and production.
It is an objective process and, while a sensible
meaning is to be
preferred, courts must guard against the temptation to substitute
what they regard as reasonable, sensible or
businesslike for the
words actually used. As to background and purpose, it is common cause
that the City intentionally included
the local office criterion for
reasons which the parties agree are rational and beneficial. I now
consider the plain language of
the clause read in light of the other
relevant portions of the tender document.
[93]       First, the clause itself
commences with the words ‘
In order to be considered for an
appointment in terms of this tender, tenderers must have an office
[locally]’
.
The bidder is also required, in terms of
the same clause, to reflect the address of that office in the same
document. This strongly
suggests that the local office must already
be in existence at the time of submitting the bid in order to qualify
for appointment.
If this were not the case it is difficult to
conceive how a prospective bidder could comply with it.
[94]       Second, the clause is
located within clause F.2.1 which is headed ‘
Responsiveness
Criteria’
as well as under clause F.2.1.4 which states in
unequivocal terms that ‘
Only those tenders that satisfy the
following criteria will be declared responsive’.
[95]       Third, clause F.3.8 deals
with the ‘
Test for responsiveness’
and clause
F.3.8.2 obliges the City to ‘
Reject a non-responsive tender
offer, and not allow it to be subsequently made responsive by
correction or withdrawal of the material
deviation’.
In
turn, clause F.3.11.1 includes a 7-step bid evaluation process which
must be followed, and kicks off with the first step being
to
‘
Evaluate all tender offers for responsiveness as per F.3.8,
and reject any found to be non-responsive’
.
[96]       The applicants submit that
when clause F.2.1.4.5 refers to a bidder being considered ‘
for
an appointment’
this is to an appointment for individual
projects executed after tender award. This, they suggest, is
bolstered by a comparison
with clause F.2.1.4.2 which starts with ‘
In
order to be considered for an appointment in terms of this tender,
the tenderer must have the following key personnel in its
employment
at the close of tender’.
Accordingly, so the argument goes,
if the tender document required the local office to be in place at
the time of tender, it would
explicitly have said so, as it has in
the case of key personnel.
[97]       However there is nothing in
clause F.2.1.4.2 to indicate that the key personnel concerned
must
already be located in the local office at the close of tender. They
are only required to be in the permanent employment of
the bidder at
that time, alternatively, the bidder must furnish signed undertakings
from specialist consultants/firms having the
required personnel,
stating that they will undertake the necessary work on behalf of the
tenderer in terms of sub-consultant agreements.
[98]       Moreover, while those
responsible may be criticised for a measure of poor draftmanship,
I
do not see how the applicants can get around the plain wording of
clauses F.3.8.2 and F.3.11.1. These apply equally to clause
F.2.1.4.5
and F.2.1.4.2 (along with other responsiveness criteria). To my mind
the interpretation for which the applicants contend
overly strains
the meaning of clause F.2.1.4.5. Instead, properly construed, the
clause in question is a responsiveness or pre-qualification
criterion
which, if not met, must result in rejection of the bid.
[99]       The question which then
arises is whether a failure to meet that criterion at the time
of
tender is a material deviation, since immediately after clause
F.3.8.2 is F.3.8.3 which reads as follows:
‘
The Employer reserves
the right to accept a tender offer which does not, in the Employer’s
opinion, materially and/or substantially
deviate from the terms,
conditions and specifications of the tender documents.’
[100]    This must be read together with the remainder
of clause F.3.8.2 which provides that:
‘
A responsive tender is
one that conforms to all the terms, conditions and specifications of
the tender documents without material
deviation or qualification. A
material deviation or qualification is one which, in the Employer’s
opinion, would:
a)
detrimentally
affect the scope, quality, or performance of the works, service or
supply identified in the Scope of Work,
b)
significantly
change the Employer’s or the tenderer’s risks and
responsibilities under the contract, or
c)
affect the
competitive position of other tenderers presenting responsive
tenders, if it were to be rectified.’
[101]    The applicants submit that the City had a
discretion to condone non-compliance with the local office criterion,

particularly where the bidders’ non-compliance is accompanied
by a mechanism permitting it still to meet the rationale or
purpose
of the provision not complied with, i.e. ensuring the presence of a
local office at the time of contract award. This, according
to the
applicants, means that the tender document complied with the
principles of competitiveness and fairness.
[102]    In
Afribusiness
[34]
the Supreme Court of Appeal, albeit in a different context,
emphasised that:
‘
Any pre-qualification
requirement which is sought to be imposed must have as its objective
the advancement of the requirements of
s 217(1) of the Constitution.’
[103]    The local office pre-qualification criterion
excludes potential bidders who do not have a local office
at the time
of submitting their bids. This hampers competition. It impedes the
fairness of the tender process. It is in conflict
with the clear
imperatives of s 217(1) of the Constitution as well as s 112(1) of
the MFMA, regulation 27(2)(a) of the SCM regulations,
and the City’s
own SCM Policy.
[104]    The failure to meet both a constitutional and
empowering legislative requirement (leaving aside subsidiary

instruments such as regulations and policy) can only constitute a
material deviation. There is no room for condonation in the sole

discretion of the City, whether for practical reasons or otherwise.
Nor can the failure to identify this particular criterion (in
clause
F.3.8.2 of the tender document itself) as one constituting a material
deviation somehow confer upon the City a discretion
to condone, since
it goes to the heart of a fair, equitable and competitive tender
process.
105]    For these reasons I conclude that the
inclusion of this criterion in tender 293C rendered that tender
unconstitutional
and unlawful. The nature and extent of the
illegality are fundamental. Accordingly the merits of the City’s
legal challenge
are sound. This is the second reason why the delay
should be overlooked.
[106]    The third issue to consider is the City’s
conduct. It can fairly be criticised by the applicants
for dithering
about for a year before reaching the conclusion that tender 293C
could not proceed, and for failing to ensure timeous,
open channels
of internal communication.
[107]    However what must also be acknowledged is the
practical reality of the inner machinations and processes
which the
City was required to follow in the face of dealing simultaneously
with 42 COMAFS raised by the AGSA. There can furthermore
be no
question (and indeed the applicants do not suggest otherwise) that
the City acted in good faith throughout and with the intent
to ensure
clean governance, not only in respect of tender 293C but many others
as well. To my mind these factors constitute a basis
for the third
reason to overlook the delay.
Conclusion
[108]    To sum up: the delay was unreasonable; the
City failed to provide a satisfactory explanation for the delay;
but
I am persuaded that there are sound reasons for the delay to be
overlooked. It is thus not necessary to consider the
Gijima
principle, nor is it necessary to deal with the revised interdictory
relief which the applicants seek.
[109]    As far as costs are concerned, although the
applicants submitted they should be entitled to their costs
even if
the counter-application succeeds, I did not understand this to be
pursued with much vigour. I agree with the City’s
submission
that there should be no order made as to costs. The City sought a
self-review as a result of its own mistake. The main
application was
a non-vexatious proceeding for the judicial review of an exercise of
public power by an organ of state. In these
circumstances the
Biowatch
[35]
principle applies.
[110]
The following order is made:
1.
The main application is
dismissed.
2.
The counter-application
succeeds.
3.
The following decisions of the
first to third respondents (“the City”) are reviewed and
set aside:
3.1
The approval
by the City’s Bid Specification Committee on 1 February
2019 of the tender documents for tender number 293C/2018/19
(“Tender
293C”);
3.2
The
advertising by the City of Tender 293C and its tender documents on 8
March 2019; and
3.3
The decision
by the City’s Bid Adjudication Committee on 17 February
2020 to award Tender 293C to the applicants and
the fourth to ninth
respondents.
4.
No order is made as to costs.
J I CLOETE
For applicant
: Adv
S
Rosenberg
SC,
rosenberg@capebar.co.za
;
072 831 1554
Adv A
Toefy
,
achmat.toefy@capebar.co.za
;
083 259 4493
Instructed by
:
Weavind & Weavind Inc, R Johnson,
raiford@weavind.co.za
;
082 901 5068
For respondent
: Adv
A
Breitenbach SC
,
breitenb@capebar.co.za
;
082 775 0599
Adv K
Saller
,
karla.saller@capebar.co.za
;
073 185 5461
Adv M
Tsele
,
mvtsele@gmail.com
;
083 301 2182
Instructed by
:
Toefy Attorneys,
info@toefyattorneys.co.za
;
021-110 5515, M Toefy, 083 290 9066
muzzamil@toefyattorneys.co.za
;
[1]
Main founding affidavit para 63.
[2]
See
Asla
referred to hereunder at para [45].
[3]
Seale v Van Rooyen NO and Others; Provincial
Government, North West Province v Van Rooyen NO and Others
2008
(4) SA 43
(SCA) at paras [12] to [14].
[4]
Local Government: Municipal Systems Act 32 of 2000
.
[5]
Section 33
applies because the contracts extend beyond
the City’
s 3
-year budgetary period.
[6]
First applicant’s founding affidavit para 80,
p58.
[7]
Promotion of Access to Justice Act 3 of 2000.
[8]
2019 (4) SA 331 (CC).
[9]
Asla
para [48].
[10]
Asla
para [52].
[11]
Asla
paras [53] to [54].
[12]
Asla
para [54].
[13]
Asla
para [55] to [58].
[14]
Referring to
Merafong City Local Municipality v Anglogold Ashanti
Limited
2017 (2) SA 211
(CC) at para [61].
[15]
Asla
paras [59] to [62] referring to good faith or intention
to ensure clean governance in
Department of Transport and Others
v Tasima (Pty) Ltd; Tasima (Pty) Ltd and Others v Road Traffic
Management Corporation and Others
2017 (2) SA 622
(CC) at para
[168].
[16]
Asla
[63] referring to
State Information Technology Agency
SOC Ltd v Gijima Holdings (Pty) Ltd
2018 (2) SA 23
(CC) at paras
[40] to [41].
[17]
Municipal Supply Chain Management Regulations, 2005 made under the
MFMA (contained in GN 868 of GG 27636 dated 30 May 2005, as

amended).
[18]
See in particular Annexure B at pages 773-782.
[19]
The cancellation was sought in terms of clause 277.4 of the SCM
Policy and regulation 13(1)(d) of the Preferential Procurement

Regulations, 2017 (GN R32 in GG 40553 dated 20 January 2017).
[20]
Asla
at para [48].
[21]
2016 (2) SA 199 (SCA).
[22]
At para [16].
[23]
Opposition to Urban Tolling Alliance v SANRAL
[2013] 4 All SA
639 (SCA).
[24]
Asla
at paras [49] to [50].
[25]
Cape Town City v Aurecon SA (Pty) Ltd
2017 (4) SA 223
(CC) at
paras [38] to [39].
[26]
Khumalo and Another v Member of the Executive Council for
Education: KwaZulu Natal
2014 (5) SA 579
(CC) at paras [35] to
[36].
[27]
Khumalo
at para [46].
[28]
In contrast to
Financial Services Board and Another v De Wet NO
and Others
2002 (3) SA 525
(C) at para [147].
[29]
Asla
at para [52].
[30]
Para 2.2 of the BEC report, record p78.
[31]
At para [49] with reference to
Allpay Consolidated Investment
Holdings (Pty) Ltd v Chief Executive Officer of the South African
Social Security Agency
2014 (1) SA 604
(CC) at para [40].
[32]
See clauses 1.24, 1.25, 29, 108, 129 and 408 of the SCM Policy.
[33]
Natal Joint Municipal Pension Fund v Ndumeni Municipality
2012 (4) SA 593
(SCA) at para [18].
[34]
Afribusiness NPC v Minister of Finance
2021 (1) SA 325
(SCA)
at para [38].
[35]
Biowatch Trust v Registrar, Genetic Resources, and Others
2009
(6) SA 232
(CC).