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[2018] ZAGPJHC 84
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City of Johannesburg v Faithful Business Enterprise CC and Others (16/23755) [2018] ZAGPJHC 84 (16 February 2018)
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
Case
number 16/23755
16/2/2018
In the matter between:
CITY
OF
JOHANNESBURG
Applicant
And
FAITHFULNESS
BUSINESS ENTERPRISE CC
1
st
Respondent
BONAMINI
ENTERPRISE (PTY)
LTD
2
ND
Respondent
RADSINVESTMENT(PTY)LTD
3
RD
Respondent
LINK
REFLECTIVE & PROTECTIVE DESIGNS
CC
4
TH
Respondent
SUNDAY
KIT UNIFORM SUPPLIES
CC
5
TH
Respondent
JUDGMENT
Molahlehi
J
Introduction
[1]
The applicant has withdrawn its application to review and set aside
the Service Level Agreements (SLAs) which it had concluded
with the
respondents during September 2014. The SLAs concerned the supply and
delivery of various items of footwear for use by
members of the
Johannesburg Metro Police Department (JMPD). The applicant also
pleaded to have processes which led to the SLAs
declared invalid and
set aside.
[2]
The application was opposed by the first respondent.
[3]
The applicant withdrew the application on the day of the hearing of
the matter because the dispute had become academic, as the
period of
the SALs was to expire in September 2017.
[4]
The issue that then remained for determination concerned costs which
the applicant had not tendered in its withdrawal. The respondents
contended that they are entitled to costs as the withdrawal amounted
to a successful defence.
Background
facts
[5]
As stated above the parties concluded the SALs during September 2014
for the supply of various foot wear for use by members
of the JMPD
following the tender process which was advertised by the applicant
during January 2014 in various newspapers.
[6]
All the twelve applications for the tender which were received on
time were considered by the Bid Evaluation Committee [BEC]
at the
meeting held on 4 April 2014.
[7]
After an assessment seven of the bidders were disqualified and the
remaining five moved to the next stage in the bidding process.
And
the ultimate decision of the BEC was that all the five bidders
qualified and were recommended to the Central Adjudication Committee
(CAFC) and subsequently the Executive Adjudication Community (EAC)
that the five should benefit from the tender.
[8]
It then transpired upon evaluation by the Screening Committee of CAC
that the number of items to be purchased over a three year
period
would exceed R10 million thresholds. This fell outside the
jurisdiction of the CAC. It was for this reason that the matter
was
referred back to the BEC.
[9]
The BEC then prepared an amendment to its recommendations. The
recommended amendment which was subsequently referred to the
EAC
estimated the value of the tender at R70 million. The amendment also
altered the scoring of the appellants. Bonani Enterprise
and
Faithfulness were respectively scored as number one and two.
[10]
The EAC accepted the recommendation of the BEC in particular that the
tenders be split between the applicants. And after that,
the tender
was awarded, and subsequently, the parties signed the SLAs.
The
reasons for seeking the cancellation
[11]
The applicant sought the cancellation of the SALs mainly because of
the query raised by the Auditor General (AG) concerning
the increase
in the value of the tender since the advertisement. Following the
AG's query, the city manager was approached to grant
a post-approval
for the deviation concerning the advertisement in terms of regulation
36(1) (b) of the SCM Regulations. The city
manager did not grant the
condonation for deviation.
[12]
The procurement was way above the budget of R4,5 million. In other
words, the value of the items to be procured fell outside
the
approved budget. The variation between R4.5 million and R 70 million
was not a minor breach which could be condoned in terms
of regulation
36 (1) (b) of the SCM Regulations.
[13]
The tender awarded did not comply with the Preferential Procurements
Framework Act number 5 of 2000 (PPFA) for reasons set
out in the
founding affidavit which need not be repeated in this judgment.
[14]
In opposing the application, the respondent has raised one point
in
limine,
contending that the deponent to the founding affidavit.
Mr. Clark has no personal knowledge of the issues at hand. It
contended
further that the confirming affidavit by Mr. Msimang who
signed the SLAs on behalf of the respondent and the city manager, Mr.
Fowler was not attached to the applicant's papers.
[15]
As for the comments made by Mr. De Klerk, the deponent to the
founding affidavit of the respondent contended that the comments
made
at paragraph 24, 25, 26 and 27 of the founding affidavit are hearsay
because it refers to Mr. Fowler who has not attested
to any
confirmatory affidavit.
Withdrawal
of proceedings -costs implication
[16]
In terms of rule 41 (1) of the Rules, proceedings may be withdrawn
before the matter is set down for hearing. A withdrawal
after the set
down can either be by consent of the parties or leave of the court.
[17]
A party that withdraws from the proceedings once the matter has been
set down has to do so, on notice which may embody consent
to payment
of the costs. If consent to payment of the costs is not made in the
notice of withdrawal, the other party is entitled
to apply for costs.
[18]
It is generally accepted that a
litigant who withdraws proceedings is in the same position as an
unsuccessful litigant.
[1]
[19]
In the present matter, the applicant's matter was set down on 22
November 2017. On that day the applicant withdrew its application
on
the basis that the SLAs expired in September 2017. In other words,
the application had become moot. It did not offer any costs
consequent to the withdrawal.
[20]
It is common cause that the applicant had delayed in instituting the
review application. It was for this reason that it filed
a
supplementary founding affidavit seeking condonation for that delay
in instituting the review application. The first difficulty
which the
applicant faced had the matter proceeded concerned the issue of the
admission of that affidavit.
[21]
The period of the delay and the reason for not applying for
condonation at the time of filing the founding affidavit is stated
in
the supplementary founding affidavit in the following terms:
"16. A period of
approximately thirteen (13) months had lapsed between the awarding of
the tender and that institution of the
of the review application. I
confirm that the delay in the institution of the proceedings was not
deliberate. I submit that the
Applicant did all it could within the
circumstances to establish the correct legal procedure and to
ultimately correct its own
decision, which it accepted."
[22]
In my view, the prospects of the applicant succeeding with the
condonation for the delay in instituting these proceedings are
very
poor, and thus the likelihood of succeeding had this matter proceeded
remains questionable.
[23]
The explanation for not withdrawing the matter earlier is also
unsatisfactory. The applicant was legally represented and has
a legal
department that assists it with legal matters. The date of the expiry
of the SLAs is a matter which the applicant could
have noticed much
earlier.
[24]
For the above reasons, I find that the withdrawal of the application
amounts to failure of the application and therefore I
see no reason
why the general rule on costs should not find the application. I am
however not persuaded that punitive costs would
be appropriate.
Order
[25]
The applicant is to pay the costs of the First Respondent for this
application.
_________________
E
Molahlehi
Judge
of the High Court;
Johannesburg
Representations:
Counsel
for the Applicant: Adv E Enaboi
Instructed
by: Mkhabela Huntley Adekeye Inc
Counsel
for the Respondent: Adv C Boden
Instructed
by: JJS Manton Attorneys
Heard
on: 22 November 2017
Delivered
on: 16 February 2018
[1]
Germihuys v Douglas
1973 (3) SA 299
(NC) Sentraboer Korporasie Bpk v
Maphaka
1981 (2) SA 814(at 818.