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[2024] ZAECMKHC 44
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Sokhani Development & Consulting Engineers (Pty) Ltd v Alfred NZO District Municipality (1254/2024) [2024] ZAECMKHC 44 (26 April 2024)
IN
THE HIGH COURT OF SOUTH AFRICA
(EASTERN
CAPE DIVISION, MAKHANDA)
CASE
NO:1254/2024
In
the matter between:
SOKHANI
DEVELOPMENT & CONSULTING
ENGINEERS
(PTY) LTD
APPLICANT
And
ALFRED
NZO DISTRICT
MUNICIPALITY
RESPONDENT
JUDGMENT
ZONO
AJ:
INTRODUCTION
[1] This
matter was set down on an urgent basis for hearing on 23 April 2024.
The application is divided
into two parts, namely, Part A and Part B.
What was before court was Part A of the application, which was an
urgent application
seeking numerous interdictory relief.
[2] The
relief in Part A of the application is couched in the following
terms:
“
1.
That
the applicant’s non-compliance with the rules relating to time
periods, form and service for bringing the application
is condoned
and that the matter be heard as urgent in terms of Rule 6(12)(a) of
the Uniform Rules.
2. That
pending the determination of the relief sought in
Part B
hereof, the respondent be and is hereby:
2.1 interdicted
and/or restrained and/or prevented from implementing the purported
cancellation of the applicant’s
appointment dated 23
rd
September 2023, read together with the Service Level Agreement
concluded and/or entered into between the parties;
2.2 interdicting
and/or restrained and/or prevented from appointing alternative
service providers to render
the services set out in the applicant’s
letter of appointment dated 23 September 2023, read together with the
Service Level
Agreement concluded and/or entered into between the
parties;
2.3 directed
to allow and/or permit the applicant to perform its obligations in
terms of the appointment
letter dated 23 September 2023 read together
with the Service Level Agreement concluded and/or entered into
between the parties
until all the contractual obligations arising
thereto are performed; and
2.4 interdicted
from withdrawing the project registration from the Provincial
Department of Co-operative
Governance.”
3. That
the relief sought in paragraph 2 above shall operate as an interim
order with immediate effect and
shall continue to do so pending the
finalization of the review proceedings in Part B thereof.
4. That
the respondent and/or any person who unsuccessfully opposes the
application be directed to pay costs
of this application, which costs
must be on punitive scale of attorney and own client.
5. Further
and/or alternative relief.”
[3] Part
B of the application essentially deals with the review of the
decision of the respondent to cancel
applicant’s appointment
dated 23 September 2023, which appointment, so the argument goes, is
pursuant to the Service Level
Agreement concluded between the
parties. The applicant as a consequence of the above seeks to be
allowed or permitted to perform
its obligations in terms of the
appointment letter dated 23 September 2023 read together with the
Service Level Agreement aforementioned.
Punitive cost order is
sought. The review application foreshadowed in Part B of the
application is not before court for determination
at this stage. Only
interdictory relief sought in Part A is for determination. Part A is
an application for interim interdict pending
the final determination
of Part B, which is a review application.
[4] The
application is opposed by the respondent and in so doing it has
delivered its opposing affidavit.
Thereanent to this application the
respondent raises the following paraphrased points: Firstly, it
challenges the urgency of the
matter and contends that the matter
lacks the necessary urgency. Secondly, the respondent complains about
non-compliance with the
provisions of Rule 41A of the Uniform Rules
of Court. Thirdly and lastly, it contends that the applicant has
failed to satisfy
the requirements of the interim interdict. I
hereinafter deal with the points raised.
Urgency
[5] The
respondent in its answering affidavit contends that the application
is not urgent. In canvassing
this point the respondent asserts as
follows under the rubric
“URGENCY”
:
“
11. The
application is not urgent for a variety of reasons. The decision to
appoint the applicant was one
taken on the 26
th
March 2013 after the applicant became the preferred service provider
through a tender process. This appointment consisted of three
stages
and the applicant had already been appointed to proceed and finalize
the third and last stage as far back as 14 September
2018 for a
period of five years.
12. Any
appointment after the one of the 14 September 2018, should have
followed the Supply Chain Management
process and the applicant cannot
claim to have not been aware of the respondent’s internal
processes that had to be followed
before it could be appointed to
continue providing the same services for the third stage.
13. After
all, the respondent can provide the basic services whilst attempting
to correct the irregularities
caused by the appointment of the
applicant.
14. With
regard to the salaries of the applicant’s employees, the
applicant cannot claim it was entitled
to the monies that would have
come about as a result of irregular appointment and invalid Service
Level Agreement. All the monies
due and payable to the applicant were
paid by the respondent.”
[6] From
these allegations, it is apparent that the point about the urgency of
the matter deals with some
allegations in the applicant’s
founding papers. I observed that this point is ineluctably bound up
and intertwined with the
merits of the case. However, the respondent
traces the urgency of this matter back from the stage of applicant’s
appointment
on 26 March 2013 when the tender was awarded to the
applicant. Alternatively, from 14 September 2018 which is allegedly
the date
of appointment to proceed with the final stage of the
services. To bolster this point the respondent asserts that the
applicant
should have been aware that the respondent’s internal
processes were not followed.
[7] The
applicant in its founding affidavit makes the following allegations:
“
32. On
the 7
th
of February 2024 the respondent forwarded to the applicant by email a
letter of cancellation of its appointment. This letter purportedly
cancelling the applicant’s appointment is dated 30 January 2024
but was only emailed to the applicant on the 7
th
of February 2024 at 10:46 ….
42. The
letter of cancellation was forwarded to the applicant by email on the
7
th
of February 2024. The applicant consulted its
attorneys to handle this matter. Having consulted with the
applicant’s attorneys
at the first available date being Monday,
the 12
th
of February 2024 at 16:00. The applicant’s
attorneys thereafter forwarded a letter on the 14
th
of
February 2024 by email to the respondent requesting further
information as well as confirmation as to which letter of appointment
has been cancelled. Further information was sought as to precisely
what supply chain processes were not followed. Thereafter, as
no
response was received to the letter of 14
th
of February
2024 a further letter was forwarded to the respondent on the 15
th
of February 2024 in which letter the applicant indicated that the
cancellation was not accepted and that the cancellation of the
appointment was wrongful, unlawful and fell to be reviewed and set
aside. The applicant’s attorney Mr Mathew Moodley subsequently
telephoned the Acting Municipal Manager who confirmed receipt of both
letters.
44. I
state that the need to bring an application to interdict the
respondent from implementing the cancellation
of the agreement
pending a review of the decision to do so is a matter of crucial
urgency for the reasons set out above.
In particular, a
pressing concern is the fact that the community that Mbizana requires
urgent service delivery in respect of the
processing of water which
is a human right. The decision by the respondent to cancel the
applicant’s appointment has massive
financial implications for
the applicant and these implications are overwhelmingly obvious.
There are labour complications involving
possible retrenchments of
staff members all of whom must be treated humanly and sympathetically
by the applicant.”
[8] The
applicant continues to make submissions in the founding affidavit to
the effect that if the interdictory
relief sought in Part A of the
application is not granted, the applicant faces a situation that, if
it succeeds in Part B of the
application, that may result in an
undesirable consequence of having a hollow judgment in its favour.
[9] In
the replying affidavit the applicant alleges that it made out a case
for hearing of the matter on
a semi-urgent basis by the utilization
of truncated time limits. The nub of the applicant’s case on
urgency is that this
application was prompted by the letter of
cancellation of its appointment dated 30 January 2024 that was
delivered to the applicant
on 7 February 2024. A submission was made
on behalf of the applicant that this application was brought with
necessary promptitude.
I accept that the instant proceedings were
triggered by the service of the letter of 30 January 2024 that was
received by the applicant
on 7 February 2024. Were it not for that
letter these proceedings would not have been instituted.
[10] This
application was only brought on 28 March 2024. The last step taken by
the applicant after the receipt
of the cancellation letter was on 15
February 2024 when it demanded of the respondent to withdraw the
cancellation letter before
the close of business on Friday 16
February 2024. A threat of litigation was made in that demand that if
the respondent failed
to adhere to applicant’s demand, this
application would be brought.
[11] During
argument, applicant’s counsel was invited to make submissions
as to the steps taken between
16 February 2024, when it was clear
that the respondent is not willing to adhere to the demand, and 28
March 2024 which is the
date of institution of these proccedings. Put
differently, the applicant was requested to account for the delay of
approximately
one and half month before institution of the present
proceedings. No answer at all was given by the applicant to explain
the delay.
[12] It
is well established that the applicant cannot create its own urgency
by simply waiting until the
normal rules can no longer be applied
[1]
.
There are degrees of urgency and it is well established that
applicants in urgent applications must give proper consideration
to
the degree of urgency and tailor the notice of motion to that degree
of urgency. On this point Plasket AJ (as he then was)
[2]
held that:
“
[37]
It
is trite that applicants in urgent applications must give proper
consideration to the degree of urgency and tailor the notice
of
motion to that degree of urgency.
28
It
is also true that when courts are enjoined by rule 6(12) to deal with
urgent applications in accordance with procedures
that follow the
rules as far as possible, this involves the exercise of a judicial
discretion by a court ‘concerning which
deviations it will
tolerate in a specific case.
[38]
……
it is not in every case in which the applicant may have departed from
the rules to an unwarranted extent that the
appropriate remedy is the
dismissal of the application. Each case depends on its special facts
and circumstances. This is implicitly
recognised by Kroon J in
the Caledon Street Restaurants CC case when he held –
looking at the issue from the other
perspective, as it were –
that the ‘approach should rather be that there are times where,
by way of non-suiting an
applicant, the point must clearly be made
that the rules should be obeyed and that the interest of the other
party and his lawyers
should be accorded proper respect, and the
matter must be looked at to consider whether the case is such a time
or not.”
[13] Notwithstanding
applicant’s failure to explain the delay between the16th
February 2024 and 28
March 2024, the applicant carefully
characterises its application as a semi-urgent application. It
further tailored its notice
of motion in such a way that it is heard
in approximately a month after its institution. Papers demonstrate
that the respondent
was served with the application papers on 4 April
2024 as the date of hearing thereof was on 23 April 2024. Sufficient
time was
given to the respondent to deal with the matter adequately.
Accordingly, the respondent managed to deliver its comprehensive
answering
papers accompanied by its counter-claim. The applicant
accordingly replied to the respondent’s answering papers. No
prejudice
was alleged or contended for by the respondent. The matter
is not extremely urgent, but sufficiently urgent to be heard on an
ordinary
motion court day, as it did.
[14] It
is well established that in pronouncing on the issue of urgency the
court exercises a wide discretion
[3]
.
The following considerations are pivotal in the exercise of
discretion: Firstly, whether the respondent can adequately present
its case in the time given; secondly, other prejudice to the
respondent and the administration of justice; thirdly, the strength
of applicant’s case and any delay in asserting its rights
(self-created urgency)
[4]
.
[15] I
have dealt with the fact that the respondent adequately presented its
case both on the papers and
during argument in court. No prejudice
alleged to have been suffered by the respondent as a result of time
shortage. With regard
to the strength of applicant’s case, I
will carefully deal therewith in the ensuing paragraphs when dealing
with the respondent’s
submissions on applicant’s
prima
facie
right.
I accordingly find in favour of hearing the matter as I have found
that it possesses an attribute of a semi-urgent
matter. In any event,
no matter would have been finalized in a space of less than one and a
half month, which is the time unaccounted
for by the applicant, if
the normal rules relating to time periods, form and service were to
be applied
[5]
. Sympathy to the
applicant and respondent’s rights to present its case are
evenly balanced
[6]
.
[16] This
brings me to the point relating to non-compliance with the provisions
of Rule 41A of the Uniform
Rules.
Non-compliance
with Rule 41A of the Uniform
[17] The
respondent complains that this application is premature as Rule
41A(2)(a) provides that in every
application proceeding, an
application must together with its notice of motion, serve on the
respondent a notice indicating whether
such applicant agrees to or
opposes referral of the dispute to mediation. In the present matter
the respondent complains that no
such notice was provided. From the
onset I must indicate that it was filed of record, but after this
challenge had been raised.
[18] It
is fitting to refer verbatim to the provisions of Rule 41A(2) of the
Uniform Rules. The provisions
provide that:
“
(2)
(a)
In
every new action or application proceeding, the plaintiff or
applicant shall, together with the summons or combined summons or
notice of motion, serve on each defendant or respondent a notice
indicating whether such plaintiff or applicant agrees to or opposes
referral of the dispute to mediation.
(b)
A
defendant or respondent shall, when delivering a notice of intention
to defend or a notice of intention to oppose, or at any time
thereafter, but not later than the delivery of a plea or answering
affidavit, serve on each plaintiff or applicant or the plaintiff’s
or applicant’s attorneys, a notice indicating whether such
defendant or respondent agrees to or opposes referral of the dispute
to mediation.”
[19] A
clear reading of the provisions plainly demonstrates that they
provide an equal election to the parties
to seek to probe from each
other whether they are desirous of resolving the matter by way of
mediation. The parties enjoy the equal
probe opportunity if they
agree or oppose the mediation process. That probe occurs in the
context of a litigation in the high court.
The ordinary grammatical
meaning of the words in the provision admits of no interpretation
that they will result in a conclusion
that, without notice in terms
of Rule 41A the proceedings are premature. It is re-iterated that the
engagement on mediation process
occurs in the process and in the
context of litigation
[7]
.
[20] I
am in agreement with Majiki J
[8]
that subrule 2(b) enjoins the respondent to also file its notice as
to whether it agrees to or opposes referral of a dispute for
mediation. The subrule does not suggest that the respondent’s
compliance is dependent on the applicant’s filing of
a Rule
41A(2)(a) notice. I find that subrule 2(b) is a self-standing rule
which is directed at the respondent. Accordingly, it
cannot be said
that the filing of respondent’s answering papers is premature
because there was no notice in terms of Rule
41A(2)(b). That kind of
interpretation can definitely result in absurdity
[9]
.
Rule 41A(2)(a) and 41A(2)(b) are independent of each other.
[21] What
is also clear in the provisions of Rule 41A(2)(b) is that if the
respondent elects to serve a notice
in terms thereof, it may do so
before the filing of a plea or answering affidavit. That simply means
that answering affidavit may
be filed without that notice and if that
happens the respondent or defendant is “
ipso
facto”
barred from doing so. The respondent misses an opportunity to suggest
to the applicant a resolution of the dispute by mediation
once it
files its answering papers. By parity of reasoning, the applicant
misses an opportunity to suggest to the respondent or
probe to the
respondent his or her attitude about the referral of the matter for
resolution by mediation once it fails to file
same at the prescribed
time. This leads me to the conclusion that the provision of Rule 41A
are not peremptory. Accordingly, they
are not fatal to the
proceedings. That of course is an interaction that takes place
outside court in terms of which the parties
seek to agree between
themselves on mediation of their dispute
[10]
.
[22] There
is an authority for proposition that parties are not compelled to
mediation. It is not even a
procedural requirement for validity of
application or action proceedings. Rule 41A notices are exchanged on
a without prejudice
basis and need not be filed in court
[11]
.
[23] Mediation
may be agreed upon even without notice, at the trial stage or during
the hearing of the opposed
matter, but with the leave of the
court
[12]
. That demonstrates
that non-compliance with the provisions of Rule 41A does not vitiate
the proceedings.
[24] Formalism
in the application of the rules is not encouraged. Technical
objections to less than perfect
procedural steps should not be
permitted, in the absence of prejudice to interfere with the
expeditious and, if possible, inexpensive
decision of cases on their
merits
[13]
. Rules should be
interpreted and applied in a spirit which will facilitate the work of
court and enable litigants to resolve their
disputes in a speedy and
inexpensive manner as possible
[14]
.
Rules of court are designed to ensure fair hearing and should be
interpreted in such a way as to advance and not reduce the scope
of
the right to a fair trial entrenched in section 34 of the
Constitution
[15]
. I
accordingly find that the prematurity point based on Rule 41A raised
by the respondent cannot be sustained and it must accordingly
fail.
[25] In
addition to the above, this is an urgent application in terms of
which the normal rules relating
to time periods, form and service is
requested to be dispensed with. The form complained of cannot be
above substance
[16]
.
Accordingly, it is inconceivable that Rule 41A can be applied in
urgent applications especially for interim relief where the applicant
makes out a case that he has no other adequate alternative remedy
available to it. In the whole tenor of its answering papers the
respondent does not allege that there is an alternative remedy
available to the applicant. That invariably means that invocation
of
Rule 41A would be fruitless and amounting to putting the form above
substance, a practice of which the courts are eschewed from
doing.
[26] The
respondent, without relying on the answering papers, raised a related
point in its heads of argument
about non-compliance with clause 15.4
of the Service Level Agreement, which reads as follows:
“
15.4 If
the dispute has not been resolved between the parties within 30 days
then the issue must be referred
to a dispute resolution or to a
mediator.”
[27] This
clause depends for understanding on clause 15.1 which reads as
follows:
“
15.1 If
Sokhani Development and Consulting Engineers fails to comply with its
obligations in terms of this
SLA, ANDM, shall notify Sokhani
Development and Consulting Engineers within 7 days of discovering
that there has been such breaches.”
[28] The
clause deals with the escalation of disputes arising from applicant’s
failure to comply with
its obligations in terms of the agreement or
appointment.
[29] This
case is clearly not about applicant’s failure to comply with
its obligations, but about respondent’s
conduct of cancelling
applicant’s appointment. I find no merit in this argument and I
therefore reject it.
Requirements
of interim relief/interdict
[30] The
final point raised by the respondent in its papers in relation to the
interim relief is that the
applicant has failed to satisfy the
requirements of the interim interdict. During hearing of the matter
the respondent strenuously
argued a requirement relating to
applicant’s rights, as I will demonstrate hereafter. The basis
of the argument is that the
underlying basis for applicant’s
rights is impugned as there is no lawful basis for a tender to have
been awarded to the
applicant or why the applicant was appointed. No
supply chain management processes were followed. If one is not
careful in dealing
with this point as the respondent was arguing, it
he may be tempted to or end up eventually dealing with the merits of
the review
application and pre-judging Part B of the application. It
is so because the respondent contends that the applicant’s
rights
emanated from the appointment, which the respondent submit
that it was unlawful and no one, so the respondent submits, may be
entitled
to a benefit out of an unlawful enterprise. The rights
sought to be protected in Part A hereof are interwoven if not the
same as
those require resolution in Part B.
[31] It
is prudent to look into the founding affidavit as it is to that
affidavit that the court must look
to understand what the applicant’s
case is; what rights the applicant is pursuing
[17]
.
I do that hereafter.
[32] The
following allegations are made in the applicant’s founding
affidavit:
“
36. The
applicant most certainly does not find the unilateral cancellation of
its appointment without any
interaction between the parties, to be in
order and rejects the cancellation which is totally unfounded,
irrational and arbitrary.
37. At
no stage has any authorised representative of the respondent
called upon the applicant to provide
its views or intentions in
regard to the lawfulness or otherwise of the appointment and at no
stage has the applicant ever been
invited to a hearing or to provide
input or to make representations in respect of any discussion of any
nature relevant to the
very far reaching decision to unilaterally
cancel the applicant’s appointment after the applicant has been
carrying out its
obligations to the full extent and to the highest
special standard for a long period since the tender was awarded
way back
in 2013.
38. The
principle of audi alteram partem has been entirely ignored and the
respondent’s conduct in
cancelling the contract amounts to
self-help. At no stage has the applicant been invited to a hearing on
the issue, nor being afforded
the opportunity of making any
representations whatsoever.”
[33] The
applicant repeats the aforestated allegation in paragraph 41 of his
founding affidavit but in different
words. It refers to the rights it
seeks to enforce as “
its rights to procedural fairness
”
(that is to be heard and/or to make representations). It premised its
application on the alleged violation of applicant’s
administrative law right to procedural fairness. In paragraph 47 of
the founding affidavit the applicant adverts the cancellation
of
appointment as administrative action.
[34] In
the same paragraph 41 the applicant makes the following allegations:
“
41. The
following of the applicant’s rights have been violated:
41.1 ……….
41.2 its
contractual right to specific performance and/or to a mandamus as the
case may be.”
It
is now apparent that in addition to administrative law right to
procedural fairness, the applicant invokes its contractual rights.
It
is those rights that are alleged to have been violated.
[35] In
its answering affidavit the respondent does not meaningfully deal
with those pertinent allegations.
There is no pertinent and
meaningful denial by the respondent to these allegations. These
allegations must be taken to have been
admitted.
[36] In
Makhuva
& Others v Lukoto Bus Services (Pty) Ltd & Others
[18]
the Learned Judge held as follows:
“
In
the course of argument I put it to Counsel for the applicant that
where the defendant is under a duty to admit or deny or confess
and
avoid a direct allegation, a reply that the allegations are taken
note of would, in the circumstances, amount to an admission.
See in
this respect the case of McWilliams v First Consolidated Holdings
(Pty) Ltd 1982 (2) SA (1) (A) at 10 E – D where
it is stated
that whilst “quiescence is not necessarily acquiescence”
a party who does not make a firm repudiation
of an allegation when
bound to do so incurs the risk of an adverse inference being drawn
against him. As to admissions, denials,
confessions and avoidance in
pleadings, See Rule 22(2) and 25(1) and as to affidavits in motion
proceedings, see Rule 6(4)(d) and
6(4)(e). It is clear that
affidavits really constitute both pleadings and evidence in support
of the allegations made and
the rules as to the pleadings should, to
that extent, be applied to affidavits.”
I
respectfully agree with the Learned Judge that a party who does not
make a firm repudiation of an allegation when bound to do
so incurs
the risk of an adverse inference being drawn against him
[19]
.
I accept applicant’s allegations to have been admitted.
[37] The
requirements which an applicant for an interlocutory interdict has to
satisfy are the following
[20]
:
“
(a) prima
facie right;
(b) a
well-grounded apprehension of irreparable harm if the interim relief
is not granted and the ultimate
relief is eventually granted;
(c) a
balance of convenience in favour of the granting of the interim
relief; and
(d) the
absence of any other satisfactory remedy.”
Prima
facie right and irreparable harm
[38] The
approach laid down by Clayden J
[21]
is as follows:
“
The
right to be set up by an applicant for a temporary interdict need not
be shown by a balance of probabilities. If it is “prima
facie
established though open to some doubt” that is enough …….
The
proper manner of approach I consider is to take the facts as set out
by the applicant, together with any facts set out by the
respondent
which the applicant cannot dispute and to consider whether having
regard to the inherent probabilities, the applicant,
could on those
facts obtain final relief at trial. The facts set up in contradiction
by the respondent should then be considered.
If serious doubt is
thrown upon the case of the applicant he could not succeed in
obtaining temporal relief, for his right, prima
facie established may
only be open to some doubt.”. But if there is mere
contradiction or unconvincing explanation, the matter
should be left
to trial and the right be protected in the meanwhile, subject of
course to the respective prejudice in the
grant or refusal of
interim relief.”
[39] I
have already expressed myself on the existence of a right to fair
admistrative procedure and the contractual
rights relied upon by the
applicant and that the existence of those rights is not disputed by
the respondent.
[40] Even
at the level of legality review it is authoritatively required that
there must be a rational connection
between the means and ends. The
means is everything the public officials does to arrive at a
decision. The means is a process employed
by a public functionary or
administrator to arrive at a decision. The notice or a process of
calling upon the applicant to make
representation is a process
(means) necessarily to have been followed to ensure the fairness of
the decision. Both the process
for which the decision is made and the
decision itself must be rational
[22]
.
Without a rational process there can be no rational decision.
[41] Khampepe
J in the Constitutional Court
[23]
made the following
dictum:
“
[86]
The
rule of law does not permit an organ of state to reach what may turn
out to be a correct outcome by any means. On the contrary,
the rule
of law obliges an organ of state to use the correct legal
process.”
[24]
It
is plainly the legal position that an administrator or public
official or functionary is enjoined to embark on a process before
the
decision is taken. He or she cannot just land without following the
due process.
[42] It
is a common cause that on 7 February 2024 a cancellation letter dated
30 January 2024, cancelling
applicant’s appointment as a
service provider was communicated to the applicant. The cancellation
was not precede by a notice.
A right to just administrative action is
a constitutional right
[25]
and
is sacrosanct. The effect of that cancellation letter was to take
away the enjoyment of the contractual rights that existed
in favour
of applicant as a result of the appointment and Service Level
Agreement concluded by the parties. It is apparent from
the
respondent’s papers that once those rights are taken, they will
never be returned as the respondent’s ultimate
aim is to
appoint another service provider. Therefore, I am satisfied that the
applicant may suffer an irreparable harm, even if
it succeeds in Part
B of the application. That success would be meaningless to the
applicant as the horse will have been bolted.
[43] The
applicant makes a point that its employees who are breadwinners at
home will tremendously suffer
an irreparable harm as they will have
to be laid off for operational reasons. It cannot meaningfully be
disputed that employees
are assets and constitute human capital of
every organization. Therefore, the cancellation of that huge contract
that has taken
so long from March 2013 to the date of cancellation
would, costs applicant the assets and human capital in the form of
its valuable
employees. The cancellation occurs at a time when two of
the three stages of the project had already been finished.
[44] I
further observe that the cancellation occurs at a time when applicant
was constantly demanding payment
for an already performed work. I say
this without deciding it that the cancellation appeared to be a witch
hunt. It is undisputable
that the applicant exhausted the only avenue
available to it by seeking an amicable resolution of the dispute by
requesting the
respondent to withdraw the cancellation letter but to
no avail. This application was a measure of last resort. Then the
applicant
has no adequate alternative remedy available to it.
[45] The
respondent, as a sigh of despair, sought to rely on the provision of
section 82 of
Local Government: Municipal Systems Act 32 of 2000
which deals with the internal appeals within the Municipality. The
respondent did that without any facts having pleaded for proper
invocation of those provisions. Fortunately, that argument was
properly jettisoned upon concession that it is impermissible to
argue
a case without it having been foreshadowed in the papers.
[46] The
concession was well made because Theron JA
[26]
had this to say:
“
[13]
Turning
then to the nature of civil litigation in our adversarial system it
is for the parties, either in the pleadings or affidavits,
which
serve the function of both pleadings and evidence, to set out
and define the nature of their dispute and it is for the
court to
adjudicate upon those issues. That is so even where the dispute
involves an issue pertaining to the basic human rights
guaranteed by
our Constitution, for ‘it is impermissible for a party to rely
on a constitutional complaint that was not pleaded’.”
This
dictum
was confirmed by Constitutional Court on several occasions
[27]
.
[47] The
respondent contends in its heads of argument that the applicant will
have an opportunity of bidding
if the tender is advertised.
Therefore, the applicant has an alternative remedy. There is no merit
in this point and it deserves
a short shrift. Bidding in a newly
advertised tender presents no possibility of returning an agreement
which has its own terms
and conditions, containing peculiar rights
and obligations. The contractual rights in issue here, once taken
will never return.
A new tender will have its own new rights and
obligations peculiar to itself.
[48] Another
unmeritorious point raised in the heads of argument is that granting
of an interim order will
prevent the respondent from correcting an
illegality. I disagree. The counter-claim brought by the respondent
serves exactly that
purpose, if it succeeds.
[49] I
have indirectly dealt with the requirements of balance of convenience
above when I was dealing with
a requirement of an irreparable harm.
If the applicant succeeds on review, that judgment will be a hollow
judgment or will amount
to a “
brutum fulmen”
. I am
therefore satisfied that all the requirements of the interim
interdict have been satisfied, therefore this application must
succeed.
[50] On
the debate between the court and the respondent, the question of
legality of the cancellation of
the appointment arose. That debate
was relevant for purposes of paragraphs 2.3 and 2.4 of the notice of
motion which require that
the applicant be allowed to perform its
work and that the respondent be interdicted from withdrawing the
project. It does not appear
that the cancellation was effected in
terms of any cognizable legal dispensation.
[51] There
is a legal authority for proposition that a valid exercise of public
power must have a source
in law. That is a requirement of the
doctrine of legality which forms part of the Rule of law
[28]
.
It is fundamental to our constitutional order that the legislature
and executive in every sphere are constrained by the principle
that
they may exercise no power and perform no function beyond that is
conferred upon them by law
[29]
.
Khampepe J
[30]
authoritatively
stated that:
“
[1] State
functionaries, no matter how well-intentioned, may only do what the
law empowers them to do.”
In
a nutshell the cancellation letter was without any lawful basis.
Respondent’s counsel was at pains to point out to the
law in
terms of which that cancellation was made.
[52] It
is common cause that a decision was taken by the respondent
appointing the applicant to perform public
functions. That
appointment attracted public law functions. It is well settled in our
law that until a decision is set aside by
a court in proceedings to
judicial review, it exists in fact and has legal consequences that
can simply be overlooked
[31]
.
The appointment was not set aside by a court, and on the above
authorities I find that it continues to produce legal consequences.
This authority re-enforces the question of applicant’s rights.
Accordingly, the applicant is well entitled to perform its
duties in
terms of the appointment letter until that appointment is set aside
by a court of law. Performance of duties is a legal
consequence of
the appointment.
Costs
[53] Costs
of this application are to be payable in the main application. A
party who succeeds in the main
application is entitled to the costs
of this application because of the interwovenness of the issues.
ORDER
[54] In
the result I make the following Order:
1. That
applicant’s non-compliance with the rules relating to time
periods, form and service for bringing
this application is hereby
condoned and that this matter is hereby heard on urgent basis in
terms of Rule 6(12)(a) of the Uniform
Rules
2. That
pending the final determination of Part B hereof the respondent is
hereby:
2.1 interdicted
from implementing the cancellation of applicant’s appointment
referred to in the respondent’s
letter dated 30 January 2024;
2.2 interdicted
from appointing alternative service providers to render the services
set out in the applicant’s
letter of appointment and Service
Level Agreement concluded by the parties;
2.3
directed to permit the applicant to perform its obligations in terms
of the letter of appointment read together with the Service
Level
Agreement concluded by the parties;
2.4 interdicted
from withdrawing the project registration from the Provincial
Department of Co-Operative
Governance.
3. The
provisions of paragraph 2 above shall operate as an interim relief or
mandamus
pending
the final determination of part B hereof.
4. Costs
of this application shall be costs in the review application dealt
with in Part B.
A.S.
ZONO
ACTING
JUDGE OF THE HIGH COURT
APPEARANCES:
For
the APPLICANT :
ADV NZUZO
Instructed
by :
MATTHEW MOODLEY & ASSOCIATES
51
UNION AVENUE
SELBOURNE
EAST
LONDON
TEL:
043 721 2449
FAX:
043 721 2601
EMAIL:
karlene@moodleyattrs.co.za
c/o
: NEVILLE BORMAN &
BOTHA ATTORNEYS
22
HILL STREET
MAKHANDA
REF:
Mr J. Powers/rt
For
the RESPONDENT : ADV
MEMELA
Instructed
by :
MADLANDA & PARTNERS ATTORNEYS
MADLANGA
OFFICE PARK & LAW CHAMBERS
120,
4
TH
STREET, PARKMORE
SANDTON,
JOHANNESBURG
EMAIL:
admin@mpiattorneys.co.za
;
xola@mpiattorneys.co.za
TEL:
011 217 7290
FAX:
011 447 6666
c/o
:
YOKWANA ATTORNEYS
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Matter
Heard on
:
23 April 2024
Judgment
Delivered on :
26 April 2024
[1]
See
Ngquma
and Another v Staats President; Damons NO v State President; Jooste
v State President
1988
(4) SA 224
at 243 D – E;
ENX
Group Limited v Spilkin
(2296/2022) [2022] ZAECQBHC 42 (8 November 2022) at para 15.
[2]
Nelson
Mandela Metropolitan Municipality & Others v Greyvenouw
CC
& Others
2004 (2) SA 81 (SE).
[3]
See
C
ornerstone
Logistics (Pty) Ltd and Another v Zacpak Cape Town
Depot (Pty) Ltd
[2022] 2 All SA 13
(SCA) para 30;
Lubambo
v Presbyterian Church of Africa
1994 (3) SA 241
(SE) at 242 I – 243 H.
[4]
ENX
Group Limited v Spilkin
(2296/2022) [2022] ZAECQBHC 42 (8 November 2022) at para 16.
[5]
See
Rule 6(5)(a)-(e) of the Uniform Rules.
[6]
Lagoon
Beach Hotel v Lehane
(2016 (3) SA 143
(SCA) at 152 G – H.
[7]
See
Natal
Joint Municipal Pension Fund v Endumeni Municipality
2012 (4) SA 593
(SCA) at para 17-18.
[8]
See
Nomandela And
Another V Nyandeni Local Municipality And Others
2021 (5) SA 619
at paras 9-11.
[9]
Cools
Ideas 1186 CC v Hubbard & Another
2014
(4) SA 474
(CC) at para 28.
[10]
See
Rule 41A (2)(c) of the Uniform Rules.
[11]
See
Maxwele
Royal Family & Another v Premier of the Eastern Cape Province &
Others
(2970/2020) [2021] ZAECMHC 10 (23 March 2021) at paras 49-51.
[12]
See
Rule 41A(3) of the Uniform Rules.
[13]
See
Trans-African Insurance
Co Ltd v Maluleka
1956
(2) SA 273
at 277 A – B and 278 F-G.
[14]
See
Ncoweni
v Bezuidenhout
1927
CPD 130
;
Viljoen
v Federated Trust Ltd
1971
(1) SA 750
(O) at 754.
[15]
D F
Scott (EP) (Pty) Ltd v Golden Valley Supermarket
2002 (6) SA 297
(SCA) at 301 G – H.
[16]
Rule
41A (2)(c) of the Uniform Rules.
[17]
See
M
y
Vote Counts NPC v Speaker of the National Assembly and Others
2016 (1) SA 132
(CC) at para 177.
[18]
Makhuva
& Others v Lukoto Bus Services (Pty) Ltd & Others
1987
(3) SA 376
V at 386 E – F.
[19]
See
Wightman
t/a JW
Construction
v Head Four (Pty) Ltd
[2008] ZASCA 6
;
2008
(3) SA 371
(SCA) at 375-376.
[20]
See
Settopelo
v Settopelo
1914 AD 221
at 227.
[21]
See
Webster
v Mitchell
1948
(1) SA 1186
(W) at 1189.
[22]
See
Minister
of Home Affairs & Others v Scalabrini Centre, Cape Town and
Others
2013 (6) SA 421
SCA at paras 69-75.
[23]
See
Head
of Department, Department of Education, Free State Province v Welkom
High School & Another; Head of Department, Department
of
Education, Free State Province v Harmony High School & Another
2014
(2) SA 228
(CC) at para 86.
[24]
See
Chief
Lesapo v North West Agricultural Bank & Another
[1999] ZACC 16
;
2000
(1) SA 409
CC at paras 17 – 18; P
harmaceutical
Manufactures Association of SA & Another: in re Ex Parte
President of the Republic of South Africa & Others
[2000] ZACC 1
;
2000
(2) SA 674
(CC) at paras 90-94.
[25]
See
section 33 of the Constitution.
[26]
See
Fischer
v Ramehlele
2014 (4) SA 614
SCA at 620 C – 621 C at para 13.
[27]
See
Public
Protector v South African Reserved Bank
2019 (6) SA 253
(CC) para 234;
Damons
v City of Cape Town
2022 (10) BCLR 1202
(CC) at para 117.
[28]
See
AAA
Investment (Proprietary) Limited v Micro Finance Regulatory Council
& Another
[2006] ZACC 9
;
2007 (1) SA 343
CC at para 68;
Lester
v Ndlambe Municipality & Another
2015 (6) SA 283
(SCA) para 26.
[29]
See
Fedsure
Life Insurance Ltd v Greater Johannesburg Transitional Metropolitan
Council
[1998] ZACC 17
;
1999
(1) SA 374
(CC) para 58.
[30]
See
Head
of Department, Department of Education, Free State Province v Welkom
High School & Another; Head of Department, Department
of
Education, Free State Province v Harmony High School & Another
2014
(2) SA 228
(CC) at para 1.
[31]
See
SABC
& Others v DA & Others
2016 (2) SA 522
(SCA) para 15;
Ouderkraal
Estates (Pty) Ltd v City of Cape Town & Others
2004 (6) SA 222
(SCA) para 26.