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[2022] ZAWCHC 236
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All 4 Security Services CC and Others v City of Cape Town and Others (11496/2021) [2022] ZAWCHC 236 (18 November 2022)

IN THE HIGH COURT OF
SOUTH AFRICA
(WESTERN CAPE
DIVISION, CAPE TOWN)
Case No. 11496/2021
Date of hearing:
16 November 2022
Date of judgment:
18 November 2022
In the matter between:
ALL
4 SECURITY SERVICES
CC
First Applicant
SECURITEM
(PTY)
LTD
Second Applicant
SECURITY
SA HOLDINGS (PTY)
LTD
Third Applicant
and
THE
CITY OF CAPE
TOWN
First Respondent
CBRE EXCELLERATE
FACILITIES
MANAGEMENT (PTY) LTD.
Second Respondent
AFMS
GROUP (PTY)
LTD
Third Respondent
EXCELLERATE
SERVICES (PTY) LTD
Fourth Respondent
METRO
CLEANING SERVICES (PTY)
LTD
Fifth Respondent
JUDGMENT
(Applications by First
and Third to Fifth Respondents for leave to appeal)
BINNS-WARD J:
[1]
The City of Cape Town (the first respondent
in the principal case) and the successful tenderers in Tender no.
226S/2020/21 (the
third, fourth and fifth respondents in the
principal case) have applied, separately, for leave to appeal from
the whole of the
judgment of this court in
All
4 Security Services CC and Others v The City of Cape Town and Others
[2022] ZAWCHC 182
(15 September 2022) (‘the principal
judgment’). The two applications for leave to appeal were heard
together. I shall
refer to the parties in this judgment by their
roles in the principal case. It was submitted on behalf of all of the
forementioned
respondents that the contemplated appeal should be
allowed to the Supreme Court of Appeal.
[2]
The principal judgment declared, at the
instance of the second and third applicants, that the City’s
advertisement of tender
number 226S/2020/21 was non-compliant with
the provisions of the City s supply chain management policy and the
prescripts of s 217(1)
of the Constitution, and consequently
invalid. Pursuant to that declaration, it determined that the award
of the tender contract
to a joint venture comprised of the third,
fourth and fifth respondents was also invalid, and fell to be
reviewed and set aside.
The forementioned declarations of invalidity
were suspended for a period to allow the City to make such
alternative arrangements
as it might see fit for the lawful
procurement of the services currently being provided in terms of the
contract concluded pursuant
to the impugned tender.
[3]
The applications for leave to appeal fall
to be determined in accordance with the test expressed in
s 17(1)(a)
of the
Superior Courts Act 10 of 2013
. Accordingly, this court, or
the SCA on petition, may grant leave to appeal
only
if the judge or judges concerned ‘
are
of the opinion (i) that the appeal would have a reasonable
prospect of success, or (ii) there is some other compelling

reason why the appeal should be heard, including conflicting
judgments on the matter under consideration
’.
The fact that the successful parties in the principal case elected to
abide the judgment of the court in the applications
for leave to
appeal has no effect on the approach that
s 17(1)(a)
prescribes
must be adopted.
[4]
In
respect of the first of the forementioned criteria, the appeal court
has stated more than once that leave should be granted only
where
there is ‘
a
sound, rational basis for the conclusion that there are prospects of
success on appeal
’.
[1]
Of the second criterion, Cachalia JA noted, in
Caratco
(Pty) Ltd v Independent Advisory (Pty) Ltd
2020 (5) SA 35
(SCA),
[2]
that a ‘
compelling
reason includes an important question of law or a discrete issue of
public importance that will have an effect on future
disputes
’.
The learned judge of appeal added, however, ‘[b]
ut
here too, the merits remain vitally important and are often
decisive
’.
He cited
Minister
of Justice and Constitutional Development and Others v Southern
Africa Litigation Centre and Others
2016 (3) SA 317
(SCA), where Wallis JA said ‘
That
is not to say that merely because the High Court determines an issue
of public importance it must grant leave to appeal. The
merits of the
appeal remain vitally important and will often be decisive
’.
[3]
[5]
The principal judgment speaks for itself,
and therefore it would be inappropriate in this judgment to unduly
rehash it. Suffice
it to say that the principal issues to be
determined were whether the advertisement of the tender provided
sufficient information
to potentially interested parties concerning
the services that the City wished to procure so as to comply with the
City’s
supply chain management policy. The pertinent
legislation (the
Local Government: Municipal Finance Management Act
56 of 2003
– ‘the MFMA’) requires every
municipality to have a such a policy. The evident object of the
requirement is to
assist in holding local government true to the
enjoinder in s 217 of the Constitution that government
procurement must be
done ‘
in
accordance with a system which is fair, equitable, transparent,
competitive and cost-effective
’.
[6]
The second and third applicants are
registered private security service providers. Their complaint was
that the advertisement, the
substantive part of which is quoted in
para 2 of the principal judgment, did not serve to alert the reader
to the fact that a substantial
part of the contract work on offer
involved the provision (as distinct from the management of the
provision) of security services
to certain of the City’s public
transport facilities. Although the advertisement it placed did not
say so, the ‘
facility management
services
’ that the City wished to
procure included the provision of cleaning services and security
services.
[7]
Only registered security providers are
permitted by law to provide security services; see para 38 of
the principal judgment.
The tender contract was awarded to a joint
venture comprised of three companies: the third respondent company
carried on business
as a facilities manager, the fourth respondent
company as a private security services provider and the fifth
respondent company
is in the cleaning business. The applicants
averred that had they appreciated that the tender contract included
the provision of
security services, they would have endeavoured to
put together a joint venture to tender to provide the bundle of
services that
the City sought to procure.
[8]
Addressing
the issue on generally applicable principle, this court held at para
17 of the principal judgment (with reference to
reg. 22(b) of the
regulations made under the MFMA – which were discussed at para
15-16 of the principal judgment) that ‘
An
advertisement of a tender contract could not possibly satisfy the
requirements of s 217 of the Constitution or s 112
of the
MFMA if it did not ... convey with adequate clarity the nature of the
goods or services sought to be procured
’.
[4]
Mr
Jamie
SC, for the third to fifth respondents, argued in the application for
leave to appeal that there was a reasonable prospect that
on appeal
another court would hold that that was incorrect statement of law. He
further argued that the import of the statement
was of such broad and
far-reaching effect as to raise an important question of law, and
therefore in any event provided another
compelling reason to grant
leave to appeal. I found neither leg of the argument persuasive. On
the contrary, the appositeness of
the observation made in para 17 of
the principal judgment seems to me so axiomatic that I could not come
near being able to formulate
‘
a
sound rational basis
’
to support the required opinion that there is a reasonable prospect
another court would hold otherwise.
[9]
As discussed in the principal judgment, the
term ‘
facilities management
’,
in the sense of describing a profession or occupation, is rather
vague, and very much dependant for definition on the context
in which
it is employed. The City’s engagement of a professional in the
field of ‘
facilities management
’
as a witness to explain the import of the term confirms that it is
sufficiently arcane as to deserve characterisation as
a ‘term
of art’. The court treated of the witness’s evidence at
para 32-39 of the principal judgment.
[10]
It was contended in the applications for
leave to appeal that this court was misdirected in not wholly
accepting the witness’s
uncontradicted opinion on the meaning
of the term in the context it was used in the City’s
advertisement and how it would
be understood by a reader in the
applicants’ position. I am not persuaded that those contentions
would enjoy a reasonable
prospect of being accepted by an appellate
court. The limitations on the admissibility and relevance of such
evidence are frequently
overlooked; see
Genticuro
AG v Firestone SA (Pty) Ltd
1972 (1) SA
589
(A) at 616D-618G, with reference to the statement of applicable
law by Lord Tomlin in
British Celanese
Ltd v Courtaulds Ltd
(1935) 52 R.P.C.
171
at 195 and 198. The authorities are clearly to the effect that
such evidence cannot displace the court’s function as the
arbiter of the proper construction of language, as well as the
sufficiency or insufficiency of any specification if such is in
issue.
[11]
Harms DP observed in
KPMG
Chartered Accountants v Securefin Ltd. and Another
2009 (4) SA 399
(SCA) at para 40, ‘
The
[expert]
witness
may not be asked what the document meant to him or her
’.
The learned deputy president went on to endorse the approach taken by
Aldous LJ in
Scanvaegt
International A/S v Pelcombe Ltd
[1998]
EWCA Civ 436
, stating ‘
Dealing
with an argument that a particular construction of a document did not
conform to the evidence, Aldous LJ quite rightly responded
with “So
what?”.
’
[12]
In the current case, the respondents have
argued that this court was bound to accept the evidence of the City’s
expert witness
and that of the City official responsible for placing
it as to how the advertisement would or should have been understood
by potentially
interested parties such as the applicants. The
argument flies in the face of well-established appellate court
authority.
[13]
Mr
Jamie
also submitted that there was a reasonable prospect that another
court might find that this court’s construction of the
advertisement had not sufficiently taken into account the contextual
considerations. He submitted that the court had had regard
only to
the heading to the advertisement (which was quoted in full at para 2
of the principal judgment). There was nothing in the
argument. The
body of the advertisement contained no additional information about
the nature of the services the City sought to
procure. It merely gave
information concerning matters such as the closing date by when
tenders had to be submitted, the amount
of the non-refundable tender
fee and details of to whom ‘technical enquiries’ could be
addressed. Hence my reference
earlier in this judgment to the
‘substantive part’ of the advertisement having been
quoted at para 2 of the principal
judgment. Insofar as Mr
Jamie
may have been contending that the
detailed tender documentation - part of which (from p. 101 of
the documentation) is quoted
at para 1 of the judgment - formed part
of the relevant context, the argument would miss the point. No-one
could be expected to
access and examine the detailed and voluminous
tender documentation if the content of the advertisement was
insufficient to alert
the reader that the advertised tender might be
one of interest to them. Indeed, that is, centrally, what the whole
case was about.
[14]
Mr
Jamie
argued that another court might hold that the reference in the
advertisement to ‘
the provision of
facilities and cash management services in respect of selected public
transport facilities including MyCiti and
Public Transport
Interchanges
’ was sufficient to
alert private security service providers like the second and third
applicants of the opportunity provided
by the tender to contract
their services. The principal judgment sets out this court’s
reasoning to the contrary (see para
13 and 27-42). I am not persuaded
that there is a reasonable prospect that another court would find
material fault with it.
[15]
Counsel for the third to fifth respondents
intimated at the hearing that the criticism in the notice of
application for leave to
appeal of this court’s treatment of
the arguments advanced by the respondents in the principal case with
reference to
Bato Star
and
Jivan and Louw
(see the principal judgment at para 20-25) was not being pressed. The
decision was a judicious one in my opinion.
[16]
It was argued, however, that the case was a
novel one, in that there was no other jurisprudence on the adequacy
of an advertisement
to tender. It was contended that the issue was of
importance to procurement functionaries in organs of state and that
this provided
a compelling reason within the meaning of
s 17(1)(a)(ii)
of the
Superior Courts Act for
granting leave to
appeal.
[17]
Assuming that there are indeed no other
judgments on the issue, it does not seem to me that that affords a
compelling reason for
the matter to go on appeal. The finding that
tender documentation must be clear and readily intelligible by
potential tenderers
is nothing new. Reference was made at para 13 of
the principal judgment in this regard to the pertinent remarks of
Schutz JA
in
Premier of the Free
State Provincial Government v Firechem
concerning
tender documentation. No court has ever qualified or differed from
them, and I do not believe that there is a reasonable
prospect that
another court would hold that this court’s application of them
to the issue in the current matter was misdirected.
The adequacy of a
tender advertisement is inherently dependent on the peculiar
character of the given case, and nothing about the
sufficiency or
insufficiency of the information of the advertisement in the current
case is likely to bear materially on the determination
of an
equivalent case concerning a different advertisement.
[18]
It was also argued that another court might
uphold the respondents’ contention that the applicants had not
established their
legal standing to claim the relief that was sought
in the principal case. The issue of the applicants’ standing
was traversed
in para 43-47 of the principal judgment. I am not
persuaded that there is a reasonable prospect that another court
would differ
from this court’s findings. This court’s
approach to standing reflected the common law approach described in
cases
such as
Jacobs en ’n Ander v
Waks en Andere
[1991] ZASCA 152
;
1992 (1) SA 521
(A) at
533
fin
-534E,
which has been endorsed on numerous occasions by the appeal court,
most recently in
Trustees for the time
being of the Legacy Body Corporate v Bae Estates and Escapes (Pty)
Ltd and Another
2022 (1) SA 424
(SCA)
at para 34, where Makgoka JA noted that ‘
issues
of locus standi should be dealt with in a flexible and pragmatic
manner, rather than a formalistic or technical one
’.
There is any event the further consideration that in cases in which
own interest parties (such as the applicants in the
current case)
seek to assert constitutional rights (in the current case the right
to administrative action that is lawful, reasonable
and procedurally
fair) a generous approach is adopted to standing; cf.
Giant
Concerts CC v Rinaldo Investments (Pty) Ltd and Others
[2012] ZACC 28
(29 November
2012); 2013 (3) BCLR 251
(CC) at para 41.
[19]
The respondents also contend that there is
a reasonable prospect that another court would hold that this court
erred as to remedy.
In answer to my query as to what their contention
as to appropriate remedy was, Mr
Oosthuizen
SC, counsel for the City, with whose submissions Mr
Jamie
associated himself, said that because the tender contract is due to
expire in 2024 it would have been appropriate for this court
merely
to make a declaration of invalidity without any effective
consequential relief. A similar argument was addressed, and rejected,

at the hearing of the principal case. The issue of remedy was dealt
with at para 49-51 of the principal judgment. As noted there,
the
determination of a just and equitable remedy is a discretionary
matter. The judgment sets out the basis upon which the discretion
was
exercised in this case. I am not persuaded that there is a reasonable
prospect that an appellate court would hold that this
court was
misdirected in the exercise of its discretion.
[20]
This judgment has traversed the oral
arguments addressed by counsel in support of the applications. I have
assumed that they addressed
what they considered the most salient
points of their respective clients’contentions. Suffice it to
record that I have also
considered all of the grounds set forth in
the respective notices of application for leave to appeal and in the
written submissions
with which the court was favoured in advance of
the hearing. Nothing in that material has persuaded me that it would
be appropriate
to accede to the applications.
[21]
As the successful parties in the principal
case took no part in the application for leave proceedings, it seems
appropriate to make
no order as to costs.
[22]
In the result, the applications for leave
to appeal are dismissed, with no orders as to costs.
A.G. BINNS-WARD
Judge of the High
Court
[1]
See
S
v Smith
2012 (1) SACR 567
(SCA) para 7, endorsed in
Four
Wheel Drive Accessory Distributors CC v Rattan NO
2019 (3) SA 451
(SCA) para 34.
[2]
In
para 2.
[3]
In
para 24.
[4]
Section
112(2)
of the MFMA provides that ‘
The
regulatory framework for municipal supply chain management must be
fair, equitable, transparent, competitive and cost-effective.
’