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[2023] ZAFSHC 305
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Matlakala v Office of the Public Protector and Others (856/2022) [2023] ZAFSHC 305 (6 April 2023)
IN
THE HIGH COURT OF SOUTH AFRICA
,
FREE
STATE DIVISION, BLOEMFONTEIN
Case
No: 856/2022
REPORTABLE: NO
OF
INTEREST TO OTHER JUDGES: NO
CIRCULATE TO MAGISTRATES:
NO
In
the matter between:
MAHLOMOLA
JOHN MATLAKALA
Applicant
And
THE
OFFICE OF THE PUBLIC PROTECTOR
1
st
Respondent
ADV.
BUSISIWE MKHWEBANE
2
nd
Respondent
DERPARTMENT
OF HUMAN SETTLEMENTS
FREE
STATE PROVINCE
3
rd
Respondent
ADV.
TSHEPO P TSUAELI
4
th
Respondent
HEARD
ON:
20 FEBRUARY 2023
JUDGMENT
BY:
BOMELA, AJ
CORAM:
NAIDOO, J
et
BOMELA,
AJ
DELIVERED
ON:
6 APRIL 2023
INTRODUCTION
[1]
The applicant issued out an application in this court
on 25
th
of
August 2022 for an order in the following terms:
1.
Reviewing and setting aside paragraph 7.2.1 of the
Second
Respondent's report, report number: 147 of 2019/2020, in so far as it
affects the Applicant;
2.
Reviewing and setting aside any decision and resolution
taken in line
with remedial action as stated on page 61, paragraph 7.2.1 of the
Second Respondent's report, report number: 147
of 2019/2020, in so
far as it affects the Applicant;
3.
Reviewing and setting aside the Applicant's suspension
implemented
and taken in line with the remedial action made by the Second
Respondent in her report number: 147 of 2019/2020, as
contained on
page 61, paragraph 7.2.1;
4.
Ordering the Respondents to pay the costs of this
application,
jointly and severally, the one paying the others to be absolved, on a
scale as between attorney and its client.
5.
Granting the Applicant such further and/or alternative
relief as this
honourable court may deem fit.
Mr
L Mokhele represented the applicant. There was no appearance on
behalf of the respondents, who did not oppose this application.
[2]
This application concerns the remedial action of the
Public Protector
against the then Head of the Department (HOD) of Human Settlements in
the Free State, (the Department), directing
him to investigate the
conduct of the Applicant in relation to what has become known as the
asbestos roof tender associated with
Blackhead Consulting (Pty) Ltd.
(Blackhead).
[3]
The investigation and report of the public protector
followed as a
result of a complaint lodged with the Public Protector by Ms L
Kleynhans, a member of Democratic Alliance and a member
of the Free
State Legislature. The complaint raised specific concerns regarding a
contract awarded by the Department to Blackhead
for the eradication
of asbestos roofs in the Free State Province. The allegation was that
the Department entered into the contract
without following tender
procedures when there were necessary skills within the Free State
Municipalities for the eradication of
asbestos roofs in the Free
State Province.
[4]
In order to procure the services of Blackhead, the Department
participated, in terms of treasury regulation 16A.6.6, in a Gauteng
Department of Human Settlements contract with Blackhead which
the
Gauteng Auditor General found to have been irregularly awarded in
contravention of Treasury Regulations.
[5]
The Free State Auditor General found the participation
of the
Department in the Gauteng tender to be irregular in terms of Treasury
Regulation 16A.6.6 as the regulations require that
the original
contract of Blackhead in Gauteng should have been awarded following a
competitive bidding process, as this was not
the case, the payment of
R 76 000 000.00 by the Department to Blackhead was identified as
irregular expenditure in the 2014/2015
annual financial statements.
[6]
Further complaints were that that the necessary authorization
was not
obtained from National Treasury before entering into this contract,
the advertisement did not specify the identification
and removal of
asbestos roof top, the service level agreement between Blackhead and
the Gauteng department was not valid at the
time when the Department
participated in the contact, the Service Level Agreement (SLA)
between Blackhead and the Gauteng department
did not refer to the
removal of asbestos roofs, there was no value for money received by
the Department in terms of this contract,
the advance payments made
to Blackhead were irregular and that the invoices submitted by
Blackhead did not comply with legislative
prescripts.
[7]
During the course of the investigation, the First and
Second
Respondents conducted interviews with the HOD of the Third Respondent
together with the Applicant, although the complaint
was not against
the Applicant, on the 2
nd
July
2019. Both the Applicant and the HOD indicated that the fact that the
Gauteng/Blackhead contract expired at the time
the Regulation 16A.6.6
procurement process was undertaken, did not bar them from
participating in terms of the requirements of
the Public Finance
Management Act 1 of 1999 (PFMA) or Regulations thereto. They were not
aware of the court decision in respect
of the interpretation of the
Regulations regarding participating in a contract procured by another
state institution. The then
HOD of the Department indicated that
there was a difference in opinion regarding the interpretation of
regulation 16A.6.6 between
the Auditor General and the State Law
Advisors. During the meeting, the HOD was made aware of the court's
interpretation of the
legislative prescripts. The effect was that the
contract that the Department participated in expired on the 31
st
of
March 2013 according to the Gauteng department's appointment letter
or at latest on 13 September 2013 according to the
SLA signed between
the Gauteng department and Blackhead.
[8]
The Gauteng contract was extended by the Gauteng department
on 13
May2014 for the period 01 April 2014 to August 2014. The Public
Protector found the conduct of the Department to be illegal
according
to legislative prescripts and the Gauteng and Free State Auditor
General's findings.
[9]
To this end, and before a final finding was made, the
Public
Protector issued a notice in terms of
section 7(9)
of the
Public
Protector Act 23 of 1994
to the HOD as the person against whom the
complaint was made. The HOD submitted in his response that although
he held final responsibility
in terms of the applicable legislation,
he was unaware that Blackhead had sub-contracted the contract. This
did not assist the
HOD as the Public Protector was of the view that
if the HOD had acted on the Auditor General's report released on 31
July 2015,
the further payments of One Hundred and Thirty Nine
Million Rand (R 139 000 000.00) would have been avoided. The Public
Protector
then found that the omission by the HOD to act on the
report of the Auditor General released on 31 July 2015, amounted to
gross
negligence in terms of
section 86
of the PFMA on the part of
the accounting officer in that he did not comply with
section 37
Public Finance Management Act.
[10
]
The Public Protector further found that the HOD failed to execute his
fiduciary duties in terms of the
Public Finance Management Act and
the Supply Chain Management Policy of the Department. This conduct,
found the Public Protector, amounted to financial misconduct
as
envisaged in
section 82
of the PFMA and maladministration as
envisaged in
section 6
(4)(a)(i) of the
Public Protector Act. The
Public Protector further found that the invoices that were submitted
by Blackhead to the Department did not comply with legislative
prescripts and that amounted to financial misconduct as envisaged in
section 82
of the PFMA and maladministration as envisaged in
section
6(4)(a)(i)
of the
Public Protector Act.
[11
]
The Public Protector felt that there are matters that needed further
investigation
that fell within the scope and ambit of the HOD. In her
wisdom, she felt that it would be appropriate that she directs these
to
the HOD and to that end, the appropriate remedial action, among
others, and in terms of paragraph 7.2.1 of the report was for the
HOD
to "Take the appropriate steps to ensure that the conduct of the
Director Supply Chain Management and the Chief Financial
Officer is
investigated in terms of
section 84
of the
Public Finance Management
Act within
60 days".
[12]
This makes perfect sense to the extent that the then HOD may have
shifted the
blame to the Chief Financial Officer (CFO) and the Head
of Supply Chain. The Public Protector was not investigating the
complaint
against the CFO and the Head of Supply Chain but against
the HOD. If at all the CFO and the Head of Supply Chain were to carry
some blame in the whole saga, it was then incumbent upon the then HOD
to investigate such. That investigation would have been in
terms of
Section 84
of the PFMA and within 60 days of the remedial action
against the HOD. Until this point, the Applicant did not challenge
this remedial
action and for good reason, as it was not against him
but the HOD and there was no trigger for him to do so.
LEGAL
FRAMEWORK
[13]
In terms of
section 84
of the
Public Finance Management Act, a
charge
of financial misconduct against an accounting officer or official
referred to in
section 81
or
83
of that Act, or an accounting
authority or a member of an accounting authority or an official
referred to in section 81 thereof,
must be investigated, heard and
disposed of in term of the statutory or other conditions of
appointment or employment applicable
to the accounting office or
authority, or member or official, and any regulation prescribed by
the Minister in terms of section
85.
[14]
Section 6(4)
of the
Public Protector Act gives
the powers to public
protector to investigate any conduct in state affairs, or in the
public administration and in any sphere of
the government, that is
alleged or suspected to be improper and if she deems it advisable, to
refer any matter which has a bearing
on an investigation, to the
appropriate public body or authority affected by it.
[15]
In terms of this section, the Public Protector has the power, on his
or her own initiative or on receipt of a complaint
or an allegation
or on the ground of information that has come to his or her knowledge
and which points to conduct such as referred
to in
section 6(4)
or
(5) of this Act, to conduct a preliminary investigation for the
purpose of determining the merits of the complaint, allegation
or
information and the manner in which the matter concerned should be
dealt with.
[16]
In my view, the Public Protector, attended to the complaint before
her against the HOD and decided that the matters
affecting the
Applicant did not form the subject matter of the complaint before her
and are within the scope of duties of the HOD
and as such must be
investigated by the HOD in terms of Section 84 of the PFMA. There was
therefore no trigger for the section
7(9) notice to be addressed to
the Applicant, as further investigation as directed was not
detrimental to the Applicant and was
also not an adverse finding
against the Applicant. The Section 84 enquiry would be for the
Applicant.
[17]
The section 7(9) notice may be issued in circumstances where it
appears to
the Public Protector during the course of an investigation
that any person is being implicated in the matter being investigated,
and such implication may be to the detriment of that person or that
an adverse finding pertaining to that person may result, the
Public
Protector shall afford such a person an opportunity to respond in
connection therewith, in any manner that may be expedient
under the
circumstances.
[18]
This said, and as was, during the hearing, conceded by Mr Mokhele,
the remedial
action which forms the subject matter of this review
application is against the then HOD and not the Applicant. The right
to a
Section 7(9) notice therefore did not accrue to the Applicant.
[19]
The remedial action is to the effect that the then HOD would take
appropriate
steps to ensure that the conduct of the applicant, if
there was anything wrong pointing to his direction, is to be
investigated
in terms of
section 84
of the
Public Finance Management
Act, within
60 days of the proposed remedial action. The appropriate
action recommended was therefore further investigation, and was not
detrimental
to or an adverse finding that necessitated that the
Applicant be issued with a
section 7(9)
notice. There is therefore no
proper case made out for the reviewing and setting aside of the
remedial action of the Public Protector
in terms of prayer 1 of the
notice of motion.
THE
APPLICANT'S SUSPENSION
[20]
In terms of
section 84
of the
Public Finance Management Act, a
charge
of financial misconduct against an accounting officer or official
referred to in
section 81
or
83
of that Act, or an accounting
authority or a member of an accounting authority or an official
referred to in section 81 thereof,
must be investigated, heard and
disposed of in term of the statutory or other conditions of
appointment or employment applicable
to the accounting office or
authority, or member or official, and any regulation prescribed by
the Minister in terms of section
85.
[21]
In terms of the remedial action, the investigation by the HOD into
the conduct
of the Applicant ought to have been undertaken within 60
days of the remedial action and ought to have been investigated,
heard
and disposed of in term of the statutory or other conditions of
appointment or employment applicable to the accounting office or
authority, or member or official.
[22]
The Applicant was suspended pending the investigation, no
investigation and
or hearing was undertaken as envisaged in section
84 of the PFMA, the 60 day has lapsed and the validity of the
remedial action
is affected.
[23]
It was submitted by Mr Mokhele that the Third Respondent through the
Fourth respondent took a different decision
resulting in the
suspension of the applicant without any intention of a hearing. The
applicant remains suspended and a period of
60 days has lapsed.
[24]
The Third and Fourth Respondents who took the decision to suspend the
Applicant, by agreement with the Applicant,
did not oppose the
Application and no cost order was to be sought against them. The
decision not to oppose was well founded as
the period within which
the investigation was to be undertaken lapsed and there was no action
taken by the Department against the
Applicant since his suspension.
[25]
The Public Protector's remedial action is not of an administrative
nature,
[1]
that being so PAJA
does not apply to the review of exercises of power by the Public
Protector in terms of s 182 of the Constitution
and
s 6
of the
Public
Protector Act. That
means that the principle of legality applies to
the review of the decision of the Public Protector. It however, does
not matter
in this case that the application for the review is based
on PAJA rather than on the principle of legality. In so far as the
remedial
action is concerned, no procedural differences arise and the
grounds of review that apply in respect of both pathways to review,
derive ultimately from the same source - the common law- although, in
PAJA, those grounds have been codified
[2]
.
[26]
In
Public
Protector and Others v President of the Republic of South Africa and
Others
[3]
,
it
was stated that administrative action comes into existence from the
exercise of public power. I am satisfied that the act of
suspension
flows directly from the remedial action which forms the subject
matter of this application and therefore constitutes
administrative
action that is reviewable.
[27]
The Public Protector's recommended remedial action in respect of the
HOD was properly made and is binding.
The time frame within which the
investigation ought
to have been
undertaken has come and gone and the suspension appears not to be
sustainable under the circumstances.
[28]
It is for this reason that I find that a proper case has been made
out for
the relief sought in prayers 2 and 3 of the notice of motion.
As indicated earlier, the applicant did not seek an order for costs
against the third and fourth respondents. In view of the finding that
the decision of the Public Protector was properly made, and
is
binding, no order for costs will be made against the first and second
respondents.
[29]
In the result, the following order is made:
ORDER:
29.1.
The remedial action of the Second Respondent as set out on page 61,
paragraph 7.2.1 of the second
respondent's report, report number: 147
of 2019/2020 stands.
29.2.
Any decision and resolution taken in accordance with remedial action
as stated on page 61, paragraph
7.2.1 of the Second Respondent's
report, report number: 147 of 2019/2020, in so far as it affects the
Applicants is reviewed and
set aside.
29.3.
The Applicant's suspension implemented and taken in accordance with
the remedial action made
by the Second Respondent in her report
number: 147 of 2019/2020, as contained in page 61, paragraph 7.2.1 is
reviewed and set aside.
29.4
No order as to costs is made
BOMBELA,
AJ
I
concur
NAIDOO,
J
On
behalf of the applicant:
Mr
Mokhele
Instructed
by:
Mokhele
Attorneys Inc
No.
117 Pres Reitz Ave Westdene
Bloemfontein
[1]
Minister
of Home Affairs v Public Protector
2018 (3) SA 380
SCA at 390E.
[2]
Minister
of Home affairs supra at 390E-F
[3]
2021(6)
SA 37 (CC) at 74E