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[2017] ZANCHC 65
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Exilaclox (Pty) Ltd v MEC for the Provincial Department of Roads and Public Works Northern Cape Province and Others, Ocean Echo Properties 333 CC v MEC Northern Cape Provincial Government: Department of Roads and Public Works and Another (2802/2016, 2804/2016) [2017] ZANCHC 65 (21 July 2017)
IN
THE HIGH COURT OF SOUTH AFRICA
NORTHERN
CAPE DIVISION, KIMBERLEY
Reportable:
YES
/
NO
Circulate to
Judges: YES
/ NO
Circulate to
Magistrates:
YES / NO
Case
number: JA 78/10
Case
No: 2802/2016
2804/2016
Heard
on: 01/06/2017
Delivered
on: 21/07/2017
In the matter
between:
EXILACLOX (PTY)
LTD
Applicant
(Registration Number:
2014/039737/07)
and
THE MEC FOR THE
PROVINCIAL
1
st
Respondent
DEPARTMENT OF ROADS AND
PUBLIC WORKS
NORTHERN CAPE
PROVINCE
THE MEC FOR THE
PROVINCIAL
2
nd
Respondent
DEPARTMENT OF TREASURY
NORTHERN CAPE
PROVINCE
ALKARA 79 CC
3
rd
Respondent
(Registration Number:
2010/132064/23)
In the matter between:
OCEAN ECHO
PROPERTIES 333
CC
Applicant
and
THE MEC NORTHERN
CAPE PROVINCIAL
1
st
Respondent
GOVERNMENT: DEPARTMENT
OF ROADS
AND PUBLIC WORKS
ALKARA 79
CC
2
nd
Respondent
(Registration Number:
2010/132064/23)
Coram: Mamosebo
J et Lever AJ
JUDGMENT ON REVIEW
MAMOSEBO
J
Introduction
[1]
The Department of Treasury in the Northern Cape Province needed
office accommodation. As the holder of the provincial public
purse
the society expects it to be the epitome of good governance
particularly where matters involving the
fiscus
are concerned. It needs to be vigilant, especially where action
is taken in its name.
[2]
Before us are two separate review applications which by agreement
amongst the parties were consolidated and made an order of
court on
03 February 2017 in terms of Rule 11 of the Uniform Rules of Court.
[3]
The applicants, Exilaclox (Pty) Ltd and Ocean Echo Properties 333 CC
seek an order:
3.1
reviewing and setting aside the decision to award a tender to Alkara
79 CC; and
3.2 that the tender be awarded
to it.
The
MEC for the Department of Works (the Department) and The MEC for the
Provincial Department of Treasury (Treasury) are opposing
this
application.
The
parties
[4]
The applicant in Case Number
2802/2016
is Exilaclox (Pty) Ltd
(Exilaclox), a company with its principal place of business at 459
Leyds Street, Sunnyside, Pretoria. The
applicant in Case Number
2804/2016
is Ocean Echo Properties 333 CC, a close corporation
with its main place of business at 41 Vermaas Street, Lindene,
Kimberley.
The first respondent in both applications is The MEC of
the Department. The second respondent in the Exilaclox case is the
MEC
for Treasury. The third respondent also cited as the second
respondent by Ocean Echo is Alkara 79 CC, a close corporation with
its head office situated at 76 – 79 Quinn Street, Kimberley.
Alkara is not opposing the application.
Factual
background
[5]
On 29 July 2016 The Department published an invitation to Bid under
reference Number DRPW 035/2016 to tender for the provisioning
of
office accommodation for the Treasury for a period of five years.
The closing date for the bid was 18 August 2016 at 11h00.
A
compulsory briefing session was held on 02 August 2016.
[6]
Evident from the terms of reference the Department had itemised
mandatory requirements and ancillary requirements that would
be
negotiated with the successful bidder. In terms of the mandatory
requirements, if not fully complied with,
the bidder would
be found to be unresponsive and the tender declared invalid.
[7]
The following were essential: Standard bidding documents comprising
all
bid
documents starting with the letters
NCP,
(NCP1,
NCP4
,
NCP8, NCP9, NCP6.1 and a resolution of the board of directors);
submission of
proof
of ownership, proxy or a signed agreement between the bidder and the
owner
; pricing
breakdown schedule; a valid electrical certificate of compliance and
the implementation plan. The B-BBEE status Contribution
Certificate
would
not have
invalidated the bid if it was not submitted.
[8]
The following were amongst the minimum requirements: It had to be an
existing building in Kimberley comprising a total of 7930m²
of
which 6580m² would be mandatory and the remaining 1350m²
would be negotiable. The latter would form part of the implementation
plan after the tender was awarded; the agreement would be for a
period of 5 years and the lease agreement would be entered into
with
the Department. The fact that 1350m² was negotiable after
the award clearly shows that the building would not be
ready for
immediate occupation, a point made by counsel for both applicants.
[9]
It is common cause that the Bid was awarded to Alkara 79 CC. Section
6 (1) of PAJA stipulates:
“
Any
person may institute proceedings in a court or a tribunal for the
judicial review of an administrative action.”
Exilaclox challenged the decision under Case No 2398/16. In that case
the first respondent was MEC for Treasury and the second
respondent
was Alkara 79 CC. On 18 November 2016, by agreement between the
parties,
the decision to
award tender DRPW035/2016 to Alkara was reviewed and set aside.
Treasury was ordered to re-evaluate the tenders,
including
Exilaclox’s tender within 10 days of the order.
[10]
Pursuant to the re-evaluation and re-adjudication of the bid in
compliance with the aforementioned court order Alkara was again
found
to be the most successful bidder and was awarded the tender. Hence
the second challenge, this time round by both Exilaclox
and Ocean
Echo (before us.)
[11]
Interestingly, though not surprising, the respondents made several
concessions in their oral and written submissions. They
initially
adopted the stance, pertaining to the non-submission of the NCP 4 by
Alkara, that all bidders were afforded an opportunity
by the Supply
Chain Management Unit (SCMU) to submit the NCP 4 declaration forms
after the closing date of 18 August 2016 at 11h00.
Proof of
such invitation did not form part of the papers. It is evident from
the papers that Exilaclox and Ocean Echo had in actual
fact filed the
NCP 4 form timeously. It therefore does not make any logical sense to
require them to file what was already contained
in their bids. This
contention lacked merit and was misleading.
Alkara
filed its NCP4 on 30 August 2016. Adv Moroka SC, appearing for the
respondents conceded, correctly so in my view, that
Alkara’s
bid was non-responsive
and should have been disqualified on that basis.
[12]
Assuming that the respondents had erroneously awarded the bid to
Alkara in the first round, it is inexplicable why they would
in the
re-adjudication award it to Alkara for the second time unless the re-
repeated process was hurriedly carried out or the
committees were
being inattentive. It was clear even at this stage that Alkara’s
bid was non-responsive based on the non-compliance
with a mandatory
requirement. Sec 217 of the Constitution of the Republic of South
Africa, 108 of 1996, requires the respondents
to have followed a
process that is fair, equitable, transparent, competitive and
cost-effective. ME Builders was the fourth bidder
who remained in the
race with Alkara, Exilaclox and Ocean Echo. Its bid was found to be
non-responsive because the bidder did not
return the NCP4 declaration
of interest form. In
Steenkamp
NO v Provincial Tender Board, Eastern Cape
2007 (3) SA 121
(CC);
2007 (3) BCLR 300
;
[2006] ZACC 16
a para 60 at
146A Moseneke DCJ stated that tender processes compels “
strict
and equal compliance by all competing tenderers on the closing day
for submission of tenders.”
Therefore, permitting Alkara to submit its NCP 4 after the closing
date when other bidders were excluded or disqualified on the
same
basis is discriminatory, unlawful and unconstitutional.
[13]
In any event, the requirements pertaining to the existing building
were not met by Alkara either. This is what the Bid Evaluation
Committee (BEC
)
stated in its meeting
held on 26 September 2016 at 09h00:
“
Responsive:
The bidder meets the requirements of the specifications in terms of
square meters
,
however,
the
building is still under construction
.
It must be noted that the building will still need minor interior
reconfiguration post award.”
The
Bid Adjudication Committee (BAC) met on 29 September 2016 at 12h00
and one can say the entry shows a simple cut and paste because
everything is captured in exactly the same wording as in the
evaluation committee report.
I
must interpose to say there is a reason, a good one I might add, why
a member of the Provincial Treasury must be a member of both
the BEC
and the BAC. Of significance, is that in both instances, the treasury
representative tendered an apology and did not attend
either
committee meeting.
[14]
In
Allpay Consolidated Investment Holdings and Others v Chief
Executive Officer, South African Social security Agency
2014
(1) SA 604
(CC) at para 22 the following remarks are apposite:
“
[22]
This judgment holds that:
(a)
The suggestion
that ‘inconsequential irregularities’ are of no moment
conflates the test for irregularities and their
import; hence an
assessment of fairness and lawfulness of the procurement process must
be independent of the outcome of the tender
process.
(b)
The materiality
of compliance with legal requirements depends on the extent to which
the purpose of the requirements is attained.
(c)
The
constitutional and legislative procurement framework entails supply
chain management prescripts that are legally binding.
(d)
The fairness and
lawfulness of the procurement process must be assessed in terms of
the provisions of the Promotion of Administrative
Justice Act, 3 of
2000 (PAJA).
(e)
Black economic
empowerment generally requires substantive participation in the
management and running of any enterprise.
(f)
The remedy stage
is where appropriate consideration must be given to the public
interest in consequences of setting the procurement
process aside.”
[15]
It is my finding
that the bid should not have been awarded to Alkara and the decision
to award it to Alkara was unlawful and stands
to be reviewed and set
aside. See s 6(1) of the Promotion of Administrative Justice Act, 3
of 2000.
[16]
Notwithstanding the situation with the Alkara bid we remain with two
applicants with competing interests to be awarded the
same bid, they
are Ocean Echo and Exilaclox. I will start by assessing the situation
of Ocean Echo.
The
case for Ocean Echo: Case No 2804/2016
[17]
A good point of departure is to set out the relief sought by Ocean
Echo:
17.1
That the applicant’s non-adherence to this court’s rules
related
to time periods and service is condoned, and the
application is heard as an urgent review application in terms of Rule
6(12) and
Rule 53.
17.2
That the first respondent’s decision – ostensibly taken
in November alternatively December 2016 –
to exclude the
applicant’s bid from the further evaluation in the
re-assessment process to award Bid DRPW035/2016:
Provision of
Office Accommodation for the Department of Provincial treasury is
reviewed and set aside, alternatively, is declared
unlawful and set
aside;
17.3
That the first respondent’s decision to award the bid mentioned
in prayer 1 above to the second respondent
is reviewed and set aside,
alternatively is declared unlawful and is set aside;
17.4
That any Service Level Agreement concluded between the first and
the second respondent and
related to the assailed decision is struck down in accordance with
section 8
of the
Promotion of Administrative Justice Act, 3 of 2000
.
17.5
That the first respondent is ordered to award the bid to the
applicant
and
to conclude a Service Level Agreement (SLA) with it to perform the
contract, in accordance with
section 8
of the
Promotion of Administrative Justice
Act, 3 of 2000
.
17.6
Alternatively to prayer 5 above, the Department to re-evaluate the
tenders submitted and award the contract in
accordance with a lawful
process.
[18]
Ocean Echo’s bid price for this tender was arguably the lowest.
Adv Grobler, its counsel, argued that it ought to have
been awarded
the tender since it complied with all the requirements. To its dismay
it was informed by letter dated 04 October 2016
that its bid was
unsuccessful. Attempts to obtain reasons were futile. It
approached court on an urgent basis under
case number 2368/2016. The
matter was set down for 04 November 2016 coincidentally, the
Department provided reasons on that same
day followed by other
documents and records on 11 November 2016. Ocean Echo was unaware
that Exilaclox had also approached the
court for a similar relief.
[19]
The following reasons were initially furnished by the Department as
the basis for Ocean Echos’ non-responsive bid:
19.1
That the property that Ocean Echo used to bid for the tender does not
belong to them even though a letter of endorsement
has been issued;
but this in itself is not proof of ownership.
19.2
That the building that was submitted for the bid is zoned for
residential and not commercial purposes.
19.3
Furthermore the building is not in a fit state for occupancy as it
needs to be renovated to meet the client’s
needs/requirements.
The space is also too small thus inadequate for the space required.
Ocean
Echo was dissatisfied with the above reasons.
[20]
After the Court order of 18 November 2016 Ocean Echo’s bid was
re-evaluated and re-adjudicated along with those of the
other
bidders. It was still unsuccessful. The reasons therefor were set out
in a letter addressed to a Mr PD Simons dated 02 December
2016 in
these terms:
“
RE:
SUBMISSION OF TENDER
You
submitted a proposal for the abovementioned tender. The Bid
Evaluation and Bid Adjudication process had to be redone after a
court order had been obtained in the High Court Northern Cape
Division granted on 18 November 2016. We regret to inform you that
your proposal was not successful after this process had been done.
The
reasons for rejecting your proposal are the following –
1.
It was noted in
your bid that
the
property does not belong to the bidder but has been issued with a
letter of endorsement to market the property by an estate
agent;
2.
No clear
ownership of the building [could] be established as
the person issuing the mandate
to market the property is not the owner;
3.
The building is
used as a residential accommodation and is not in a proper state. It
still needs to be renovated to meet the requirements
of the client
department and the expected time frames of issuing eviction notices
poses a risk.
4.
The bidder is
offering new construction in terms of the proposed renovations which
is not in line with the specifications.
5.
The square
meters offered are 9840 but the
current
building is only 6000 square meters
and
there is no indication of when the other square meters will be
available.
6.
Your bid does
not meet the requirements of the specifications in terms of parking
bays required.
If you believe that the Department made a procedural
or technical error in reaching this decision or that it was biased,
you are
entitled to take the decision on review to the High Court,
Northern Cape Province,
Kimberley
in terms of the Promotion of Administrative Justice Act, 2000 (Act 3
of 2000). Such an application must be made to the
Court within 180
days (6 months) of receipt of this Notice.”
[21]
Mr Grobler submitted that there is no reason or justification why the
bid should not be awarded to Ocean Echo because it has
met all the
requirements. Ms Moroka, arguing for the respondents, reiterated that
Ocean Echo’s bid is still non-responsive.
Mr Grobler was
pressed to address the ‘proxy’ aspect and whether or not
Ocean Echo met the mandatory requirement in
the submission of ‘
proof
of ownership, proxy or a signed agreement between the bidder and the
owner’
. The document that Ocean Echo submitted reads:
“
Re:
Market House, CNR Southey and Phakamile Mabitja Roads, Kimberley
The
landlord of the abovementioned property has agreed to give Ocean Echo
Properties 333 CC a sole mandate to market the property
to public
works and to outright purchase the property once the tender is
successful.”
[22]
Counsel sought to nudge us in the direction that the proxy issue has
become moot and that it was not exactly clear what the
term ‘proxy’
was designed to convey. It must be borne in mind that
the owner of the
building did not bid for the tender but Ocean Echo did. Be that as it
may, the bid was not for the sale of the
building but for a lease
thereof. We are cognizant of the fact that Ocean Echo was not
appointed a proxy in accordance with
s 58
of the
Companies Act, 71 of
2008
, a point correctly conceded by Mr Grobler.
[23]
It was enquired from counsel whether the letter that was submitted by
Ocean Echo constituted an agreement with the owner of
the building or
a
proxy
the response was none of the above. Mr Grobler objected to the
introduction
of an additional affidavit by Exilaclox which sought to
challenge
the eligibility of Ocean Echo to be favourably considered in this
bid. In the end Mr Grobler conceded that the document
cannot
serve as proof of ownership and neither does it satisfy the elements
of a proxy. It was also not a document signed by the
bidder and the
owner.
[24]
I have not elaborated on the suitability of the building and the
comments made by the respondent in the technical reports in
that
respect because the disqualification was ultimately based on the
failure to meet the mandatory requirements of a proxy.
[25]
Although in the Notice of Motion substitution was sought or the
remittance of the matter to the respondents for re-evaluation
and
re-adjudication, Mr Grobler in oral argument somersaulted and moved
for the re-advertisement of the bid, something that was
never
pleaded. To introduce this aspect without having afforded the other
parties an
opportunity
to comment on it would be prejudicial. The suggestion by
counsel for re-advertisement will not be just and equitable
regard
also being had to the time lapse that Treasury must still endure
awaiting the outcome of the process. I am mindful that
Treasury is
also partly to blame for the delay, particularly by not having
scrutinised the process with diligence, more so at the
evaluation and
adjudication stages.
[26]
It is
therefore my finding that Ocean Echo’s bid was unresponsive and
its application stands to be dismissed. However because
it was
successful in as far as having the respondent’s decision being
reviewed and set aside, it will only be fair for it
to be awarded
costs.
The
first respondent, the Member of the Executive Council: Department of
Roads and Public Works, must bear the costs of this application.
The
final matter: The Exilaclox (Pty) Ltd Case
[27]
The Department initially awarded the tender to Alkara having found
Exilaclox’s bid non-responsive. The following reasons
were
furnished by the BAC as set out by the Head of Department, Mr
Kholekile Nogwili, in his answering affidavit on behalf of the
Department on 26 January 2017:
“
16.1
Non-responsive: Members found that the signature in the offer to
purchase is not that of the seller: seller signed as the purchaser
and purchaser signed as the seller (see attached legal advice);
16.2
There is no letter of authority for Mr J Du Toit for signing the
offer to purchase (see attached legal advice);
16.3
The number of square meters 6369 as per “invalid” offer
to purchase is far less than the floor layout
plan as per bidder’s
specification plan of 10477 square meter.”
[28]
Exilaclox approached Court (Case No 2398/2016) seeking to review and
set
aside the decision to award the tender to Alkara. Matlapeng AJ
granted the order by agreement on 18 November 2016 in the following
terms:
“
1.
The decision of the first respondent to award tender DRPW035/2016
(“the tender”) to the second
respondent is reviewed and
set aside.
2.
The first respondent is ordered to re-evaluate the tenders, including
the tender of the applicant,
within 10 days after the granting of
this order.
3.
Each party pays its own cost.”
[29]
Pursuant to the afore-mentioned order the Department wrote a letter
dated 02 December 2016 to Exilaclox informing it that the
tender was
re- adjudicated by BAC
on 30 November
2016 to comply with the Court
order
of 18 November 2016 but the bid was unsuccessful. Should reasons be
required they will be furnished on request.
[30]
Notwithstanding the aforementioned letter the
Department addressed a separate communication dated
02 December 2016 and provided the following reasons for
rejecting Exilaclox’s proposal:
“
1.
The advert did not specify that qualified tenders would be considered
when calling for tenders and thus your
tender which was qualified
could not be considered;
2.
The Deed of Sale that had been submitted with the Bid had suspensive
conditions which were
not met and in particular we refer you to that
the seller had to sign the offer to purchase by 16 August 2016 for
the sale to be
valid and the seller only signed on 17 August 2016
thus the suspensive clause kicked in on the 16
th
invalidating the offer;
3.
No proof had been provided that the Company is a financially stable
company in that upon
investigation by the Department the company was
found to have been dormant and thus had no record of financial
activities. The
Committee felt that this would not guarantee that the
company would obtain finance to provide the services required in
terms of
the tender;
4.
The Company is not VAT registered with the South African Revenue
Service and thus its Tax
matters are called into question;
5.
There is no letter of authority signed by Mr J Du Toit granting him
the authority to sign
the offer to purchase on behalf of the company.
The Committee was made aware that this document was presented at
Court during the
proceedings but this document had not been part of
the Bid Documents upon submission to the Department;
6.
Even though the bidder indicated that they will provide 10 477
square meters and their
bid price was lower therefore you would not
have scored the highest points as your bid was non-responsive;
7.
Furthermore the technical report indicated that during the site visit
the bidder had informed
the team that it would not put in new lifts
but merely refurbish the old ones this posed a risk to the tenants
who would use the
building as the lifts were quite old, secondly, the
parking space alluded to was 1 kilometer away and no document was
included
in the bid document to indicate that parking would be leased
as the current parking at the proposed building is insufficient for
the tenant’s use.”
[31]
It is by virtue of the reasons furnished above that Exilaclox
approached the court again to have that decision reviewed and
set
aside. The Department seems to have abandoned some of the initial
reasons and introduced new fresh ones. When considering the
furnished
reasons of 02 December 2016 against the mandatory requirements of the
tender, the following observations are significant:
31.1
The Department did not consider its own mandatory requirements when
assessing the application but rather considered
extraneous
requirements;
31.2
Although the first stated reason was that the tender was not
considered because it was a “
qualified”
tender however at
para 60 of its answering affidavit the Department couched its initial
stance
as follows:
“
I
admit that the bid was not conditional but that the agreement of
sale contained a suspensive condition. The applicant’s
bid was
not judged to be non-responsive on the basis of this clause but the
risk was indeed highlighted.”
Thus
this no longer served as the reason to disqualify Exilaclox.
31.3
A further mandatory requirement was a signed agreement between the
bidder and the owner of the building. The second
reason advanced by
the Department was that there was no letter of authority for Mr Du
Toit who had signed the purchase agreement.
Nowhere
in the mandatory requirements was it specified that it was
necessary for the signatory to additionally attach a
letter of authority. The Department further made this averment in its
answering
affidavit:
“
In
terms of applicable legislature therefore the seller and the owner
had to exhibit clear authority to contract.”
It
was persuasively argued by Adv Cillier SC that this argument confused
the requirements in
s 2(1)
of the
Alienation of Land Act, 68 of 1981
,
with the mandatory requirements in the tender. Mr Cillier further
argued that the reasoning by the Department in first holding
that the
purchase agreement was invalid and thereafter that no agreement with
the owner accompanied Exilaclox’s tender and
was, consequently,
non-responsive for lack of compliance with mandatory
requirements to furnish an agreement
with the owner constituted a
material misdirection. I agree. See
Papenfus
v Steyn
1969
(1) SA 92
(T).
31.4
The third reason cited by the Department for non-responsiveness was
that Exilaclox failed to submit proof that
it was financially stable.
This was however not part of the mandatory requirements. Despite the
fact that Exilaclox had attached
the organogram showing how it fits
into the SMADA Group an aspect totally ignored by the Department,
nowhere in the papers was
this requirement specified.
31.5
The other basis for the exclusion or disqualification of Exilaclox
was that it was not VAT registered with the
South African Receiver of
Revenue Services. In its answering affidavit the Department provided
this unmeritorious and contradictory
position:
“
I
do however, point that the issue of the applicant’s tax affairs
and non-registration as a VAT practitioner did not disqualify
the
applicant.”
31.6
As far as the refurbishment of lifts is concerned as opposed to
replacement,
an aspect mentioned in the technical reports, the
Department
used this aspect to disqualify Exilaclox. It nevertheless
furnished the following statement in its answering affidavit:
“
this
did not constitute a disqualification of the applicant’s bid.”
31.7
The issue of parking that was a kilometer away was also cited as a
reason for the non-responsiveness. Parking was
also not a mandatory
requirement. In actual fact it was mentioned under the head
“additional required items.”
The relevant terms of
reference read: “
these
items are subject to negotiation prior to the award, preferred bidder
will be required to submit [a] detailed implementation
plan with
regard to additional items.”
[32]
It is clear that the Department adjusted the reasons to find
Exilaclox non-responsive. This is illustrated by the change in
reasons between the reasons furnished by the adjudication committee
and those furnished by the HOD. It remains inexplicable why
the HOD
would come up with reasons for the disqualification when he was not
even part of the adjudication committee and was not
part of the team
that assessed and analysed the qualification of the bidders.
[33]
In
National
Lotteries Board v SA Education & Environment Project
2012
(4) SA 504
SCA at 513 paras 26 – 28;
[2012] 1 All SA 451
(SCA)
Cachalia JA pronounced:
“
[26]
…The question here is not whether there were other reasons in
the record that justified the board’s decision,
but whether it
could give reasons other than those it gave initially for refusing
the application.
[27]
The duty to give reasons for an administrative decision is a central
element of the constitutional duty to act
fairly. And the failure to
give reasons, which includes proper or adequate reasons, should
ordinarily render the disputed decision
reviewable. In England, the
courts have said that such a decision would ordinarily be void and
cannot be validated by different
reasons given afterwards –
even if they show that the original decision may have been justified.
For in truth the later reasons
are not the true reasons for the
decision, but rather an ex post facto rationalisation of a bad
decision.
Whether
or not our law also demands the same approach as the English courts
do is not a matter I need strictly decide.
[28]
…The fact that it may have had other reasons for having come
to that conclusion does not change the fact
that the board exercised
its discretion unlawfully when it made the decision. In fact, it
exercised no discretion at all.
This cannot be remedied by giving
different reasons after the fact. The high court, in my respectful
view, got it right.”
[34]
A decision maker
may conceivably give supplementary reasons if it is evident that a
certain aspect was erroneously overlooked. However,
self-contradiction, as is apparent from this case does not resort in
such a category. Borrowing from Cachalia JA’s pronouncement,
the fact that it may have had other reasons for arriving at a
decision does not change the fact that the Department made the
decision
unlawfully. It cannot remedy its unlawful act by giving
different reasons after the fact.
[35]
Since the decision to award the bid to Alkara stands to be reviewed
and set aside,
s 8(1)
of PAJA affords this court a wide discretion to
grant ‘any order that is just and equitable’. Once
it can be
shown that exceptional circumstances exists, a court
can exercise a discretion in terms of
s 8(1)(c)(ii)(aa)
to make a substitution order. The section provides:
“
(1)
The court or tribunal, in proceedings for judicial review in terms of
6(1), may grant any order that is just and equitable,
including
orders –
(c)
setting aside the administrative action and –
(ii)
in exceptional cases –
(aa)
substituting or varying the administrative action or correcting a
defect resulting from the administrative action.”
[36]
On a conspectus of the aforegoing analysis it is evident that this
court will be qualified to grant an order of substitution
provided
that exceptional circumstances exist.
In
determining whether exceptional circumstances exists in this matter
or not I take cue from the pronouncements by Khampepe J writing
for
the unanimous court in the
Trencon
Construction (Pty) Ltd v Industrial Development Corporation of South
Africa Ltd and Another
2015
(5) SA 245
(CC) at 258 para 47:
“
To
my mind, given the doctrine of separation of powers, in conducting
this enquiry there are certain factors that should inevitably
hold
greater weight. The first is whether a court is in as good a position
as the administrator to make the decision. The second
is whether the
decision of an administrator is a foregone conclusion. These two
factors must be considered cumulatively. Thereafter,
a court should
still consider other relevant factors. These may include delay, bias
or the incompetence of an administrator. The
ultimate consideration
is whether a substitution order is just and equitable. This will
involve a consideration of fairness to
all implicated parties. It is
prudent to emphasise that the exceptional circumstances enquiry
requires an examination of each
matter on a case- by-case basis that
accounts for all relevant facts and circumstances.”
[37]
Khampepe J went on to say at 257D – F:
“
[42]
The administrative review context of
s 8(1)
of PAJA) and the wording
under ss (1)(c)(ii)(aa) make it perspicuous that substitution remains
an extraordinary remedy. Remittal
is still always the prudent and
proper course.
[43]
In our constitutional framework a court considering what constitutes
exceptional circumstances must be guided by
an approach that is
consonant with the constitution. This approach should entail
affording appropriate deference to the administrator.
Indeed, the
idea that courts ought to recognise their own limitations still rings
true. It is informed not only by the deference
courts have to afford
an administrator but also by the appreciation that courts are
ordinarily not vested with the skills and expertise
required of an
administrator.”
[38]
The bids in
casu
have been evaluated
and adjudicated by the relevant committees. All that was left was to
allocate the bid to the bidder whose bid
was found to be
responsive. I have already
demonstrated in the preceding paragraphs how Alkara and Ocean Echo
did not qualify because of the non-compliance
with the mandatory
requirements. This court is in as good a position as the
administrator to make appropriate decision. The decision
of the
administrator is a foregone conclusion. As Khampepe J explained at
259E: “
A
foregone conclusion exists where there is only one proper outcome of
the exercise of an administrator’s discretion and ‘it
would merely be a waste of time to order the [administrator] to
reconsider the matter.’”
[39]
It is inconceivable that the department alter its preconceived notion
should the matter be remitted to them again. It
has already had
two bites of the cherry and on both
occasions awarded the bid to Alkara even though the
overwhelming
weight of evidence at its disposal pointed the other way. It is clear
from the moment the bids were submitted that
Exilaclox’s bid
was responsive and Alkara’s and Ocean Echo’s
were non-responsive. The department
has not justified rationally its
reasons for awarding the bid to Alkara. As already stated this bid
was advertised on 29 July 2016
and we are almost a year down the line
and the bid has not been executed. It will in all circumstances not
be just and equitable
to remit the matter to the department. Neither
the department nor Ocean Echo has shown any cogent justification for
the process
to start afresh. In fact, it was not so pleaded by Ocean
Echo. A substantial amount in public funds has already gone into the
advertisements
and processing of this bids. In my view, there may be
unjustifiable prejudice occasioned by a further delay. The parties
have already
approached this court on several occasions for an
appropriate remedy.
[40]
Khampepe J continued at 260 para 54:
“
If
the administrator is found to have been biased or grossly
incompetent, it may be unfair to ask a party to resubmit
itself to the administrator’s
jurisdiction. In those instances bias or incompetence would weigh
heavily in favour of a substitution order. However,
having regard to the notion of fairness, a court may still
substitute
even where there is no instance of bias or incompetence.”
[41]
In
Livestock and Meat Industries Control Board v Garda
1961 (1) SA 342
(A) the court held:
“
the
court has a discretion, to be exercised judicially upon a
consideration of the facts of each case, and … although the
matter will be sent back if there is no reason for not doing so, in
essence it is a question of fairness to both sides.”
[42]
It is in the
light of the aforementioned instructive decisions by the
Constitutional Court and the provisions in the Constitution
referred
to hereinbefore that the decision taken by the MEC Northern Cape
Provincial Department of Roads and Public Works is found
to be
unconstitutional and must be reviewed and set aside. Furthermore,
that on the facts of this particular case exceptional circumstances
have been shown to justify substitution and substitution in these
circumstances would be both fair and just.
[43]
In the result, the following order is made:
It
is ordered:
1.
The decision of
the first respondent, The MEC for the Provincial Department of
Roads and Public Works, Northern Cape Province,
in both applications
to award tender DRPW035/2016 to Alkara 79 CC in Case No 2804/2016 and
Case No 2802/2016 is reviewed and set
aside.
2.
It is declared
that Exilaclox (Pty) Ltd, the applicant in Case No 2802/2016,
submitted the only responsive tender to the Department.
3.
It is
declared that Exilaclox (Pty) Ltd is the preferred bidder.
4.
The Department
is ordered to negotiate with Exilaclox the requirements and finishes
to which the building must comply with and do
so in strict compliance
with the terms of reference and the building specifications.
5.
The MEC
for the Provincial Department of
Roads and Public Works, Northern Cape Province, is ordered to pay the
costs of the applicants in
Case No 2804/2016 and Case No 2802/2016,
inclusive of the costs occasioned by the employment of two counsel
where applicable.
_____________________
MAMOSEBO J
NORTHERN CAPE DIVISION
I concur
____________________
LEVER AJ
NORTHERN CAPE DIVISION
For
the applicant:
Adv PG
Cilliers SC
Adv APJ Els
Instructed
by:
Waldick Jansen Van Rensburg Inc
c/o Duncan & Rothman attorneys
For
the applicant:
Adv S Grobler
Van den Heever Attorneys
For the respondents:
Adv KD Moroka
SC
Adv MP Moropa
Instructed
by:
Office of the State Attorney