About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Free State High Court, Bloemfontein
SAFLII
>>
Databases
>>
South Africa: Free State High Court, Bloemfontein
>>
2016
>>
[2016] ZAFSHC 196
|
|
MEC for Public Works and Infrastructure, Free State Provincial Government v Mofomo Construction CC (A138/2016) [2016] ZAFSHC 196 (24 November 2016)
IN
THE HIGH COURT OF SOUTH AFRICA,
FREE
STATE DIVISION, BLOEMFONTEIN
Reportable:
YES
Of
Interest to other Judges: YES
Circulate
to Magistrates: NO
Case
No.: A138/2016
In
the matter between:
MEC
FOR PUBLIC WORKS AND
INFRASTRUCTURE,
FREE STATE PROVINCIAL
GOVERNMENT
Appellant
and
MOFOMO
CONSTRUCTION
CC
Respondent
CORAM:
DAFFUE,
J
et
LEKALE, J
et
HANCKE
J
JUDGMENT
BY:
DAFFUE,
J
HEARD
ON:
31
OCTOBER 2016
DELIVERED
ON:
24
NOVEMBER 2016
I
INTRODUCTION
[1]
This is an appeal to the full bench against the whole judgment of
Mocumie J (as she then was) handed down on 22 April 2016.
[2]
This appeal turns in essence around the claim of an organ of state
that the court
a
quo
erred
in not setting aside the appointment of a contractor and/or contract
entered into consequent upon an improper and invalid
procurement
process.
II
THE PARTIES
[3]
Appellant is the MEC for the Department of Public Works and
Infrastructure, Free State Provincial Government. I shall
refer
herein to appellant as the Department to prevent any
misunderstanding.
[4]
The respondent is Mofomo Construction CC (“Mofomo”), a
contractor and the successful party in the court
a
quo
.
III
THE JUDGMENT OF THE COURT
A QUO
[5]
The court
a
quo
found that, consequent upon a proper and valid procurement process
undertaken by the Department, a valid and binding contract was
entered into between the parties.
[6]
It also dismissed the Department’s counter-application in which
it sought the review and setting aside of the appointment
of the
contractor and/or contract entered into on the basis that no valid
and competitive tender process was followed.
IV
THE
GROUNDS OF APPEAL
[7]
On 31 May 2016 the court
a
quo
granted leave to appeal to the full bench, costs to be costs in the
appeal.
[8] The Department relies
on the following grounds of appeal:
“
1.
The court
a
quo
erred in finding that the respondent has established a clear right on
the basis of the agreement concluded between it and the appellant.
1.1
First,
the purported contract is contrary to the law.
1.2
Secondly,
the offer to contract itself was subject to two conditions, which
were not complied with.
1.3
Thirdly,
by virtue of the unchallenged averments in the answering papers,
final relief was incompetent in law.
2.
Additionally, the court
a quo
ought to have found that the
offer relied upon by respondent had been withdrawn prior to
acceptance.
3.
The court
a
quo
ought to have found that the counter-application succeeds on
non-compliance with tender law principles.”
V
BRIEF
HISTORICAL BACKGROUND
[9]
It is deemed appropriate to state the following background for a
better understanding of the dispute between the parties.
[10]
The previous Head of the Department (“HOD”) is Mr M
Gasela (“Gasela”). He was replaced on a date
not
apparent from the application papers by Mr M Seoke (“Seoke”).
[11]
Bids were invited by the Department during 2015 for several
classrooms to be built at various schools throughout the Free State
Province. One such school is Ntswanatsatsi Primary School in
Cornelia.
[12]
On 11 November 2015 Gasela informed Mofomo in writing that its bid in
respect of DPWFS (T) 044/2015 for R4 429 596,08
had been
accepted subject to:
“
1.1
Entering into a JBCC series 2000 edition 4.1 Code 2101 (March 2005)
which will have to be obtained by yourself and
brought along to the
Department for signature prior to site handover;
1.2 Provision of a
10% Construction Guarantee for R442 959,61 by yourselfves to the
Department.”
[13]
According to the application papers Mofomo’s bid in respect of
contract DPWFS (T) 047/2015 in respect of the Likubu Primary
School
in Kroonstad for R3 367 997, 65 has been accepted as well
by Gasela on even date, subject to similar conditions.
[14]
Mofomo was one of the entities contracted to do similar work for and
on behalf of the Department.
[15]
According to the undisputed evidence Mofomo’s deponent signed
the applicable JBCC series contract and handed same to
the Department
together with the 10% construction guarantee. I say that the
evidence is undisputed although the Department’s
present HOD
testified that he could not find any such documentation in the
Department’s files. I return to this later.
[16]
The contact person at the Department
ex
facie
the two letters of appointment referred to
supra
is indicated as Ms A Raboroko and her email address and telephone
numbers are stated therein.
[17]
The particular site was handed over to Mofomo who started with
construction work to such an extent that a first progress payment
in
the amount of R209 453,34 was requested and eventually received
on 24 December 2015. The contact person at the Department
in
respect of this payment is a certain Mr Thabo Koko of the Kroonstad
offices.
[18]
On 15 December 2015, according to the Department, a Contractors
Development Programme Meeting was held at the offices of the
Department. Although Mofomo’s name is indicated on the
attendance list, nobody signed the register on behalf of Mofomo
and
its deponent denied that he was aware of the meeting and/or attended
same. It is not alleged in any of the two affidavits
filed on
behalf of the Department that Seoke and/or Mr Keyter (“Keyter”),
apparently an engineer and senior employee
in the Department,
attended this meeting. In fact, not a single name of any
employee of the Department features on the attendance
register.
[19]
On 23 February 2016 Mofomo sought a second interim payment as is
apparent from the payment certificate issued for the amount
of
R370 341,59. It must be remembered that it is
not the Department’s stance that the work was not
undertaken.
[20]
On 11 February 2016 Seoke in his new capacity as HOD of the
Department (who apparently succeeded Gasela, the author of the
letter
of appointment three months earlier), withdrew Mofomo’s
appointment in writing. The first two paragraphs of
the letter
read as follows:
“
1.
We refer to our letter dated 11 November 2015 in which your offer
relating to the above matter was accepted,
as well as the
consultative meeting held by the Chief Financial Officer of this
Department on 15 December 2015 with contractors.
2.
Subsequent to a perusal and scrutiny of applicable legislation and
policies, the Department realised
that the process leading up to
acceptance of your offer and your appointment failed to comply with
government procurement legislation
and policies
and
is therefore unlawful making any agreement null and void.
The Department intends to commence anew with proper procurement
processes.”
(emphasis
added – the Department did not rely on non-fulfilment of the
suspensive conditions at that stage.)
[21]
The grounds of appeal alleging that the Department’s offer to
Mofomo was withdrawn before acceptance or that the offer
was subject
to two conditions which have not been complied with are not supported
by the contents of the letter of 11 February
2016.
[22]
Mofomo was not instructed to stop any works as mentioned further in
the letter as it did not attend the meeting of 15 December
2015, it
being unaware thereof. By the time the parties entered into
correspondence during February 2016 and just before
the litigation
ensued, Mofomo had already completed approximately 11% of the works,
which is not denied.
[23]
Following the correspondence between the parties Mofomo eventually
launched its application, seeking the Department to be interdicted
and restrained from embarking upon any procurement process in respect
of the applicable project and also
“
from
performing any further unlawful acts of repudiation relating to the
contract between applicant and respondent pertaining to
such
works,……
”
[24]
The application was not only opposed by the Department, but a
counter-application was filed, claiming the following relief:
“
That
the appointment of the applicant and/or contract entered into, if
there is any, in respect of the construction of three additional
grade R classrooms at Ntswanatsatsi Primary School at Cornelia, Free
State Province on 11 November 2015 be declared to be invalid,
unlawful and unenforceable.”
It
also sought costs of the counter-application in the event of
opposition.
[25]
The matter was heard on 7 April and on 22 April 2016 the court
a
quo
delivered judgment.
VI
EVALUATION
OF THE COURT
A
QUO’S
JUDGMENT AND THE SUBMISSIONS OF THE PARTIES IN LIGHT OF THE
AUTHORITIES
[26]
Adv N A Cassim SC, who appeared with Advv B Mene and N Khooe on
behalf of the Department before us on appeal attacked the judgment
of
the court
a
quo
by following a two-pronged approach. Firstly, he submitted that
Mofomo did not prove that a contract was ever entered into
between it
and the Department and/or if such a contract was entered into, that
it was not lawful and binding. Furthermore,
it is clear from
the letter of acceptance dated 11 November 2015 that acceptance of
the tender was subject to two conditions, i.e.
the signing of the
JBCC contract and the delivery of a 10% construction guarantee whilst
Mofomo had failed to prove compliance.
Mr Cassim’s second
point of attack related to the alleged invalid tender procedure
followed by the Department. I shall
deal
infra
with the submissions made in this regard.
[27]
In considering the main and counter-applications it is required to
consider the requirements enunciated in
Plascon-Evans Paints
.
I also wish to refer to the following
dictum
by Heher JA
in
Wightman t/a JW Construction v Headfour (Pty) Ltd and
Another
[2008] ZASCA 6
;
2008 (3) SA 371
(SCA), quoting from para [13]:
“
[13]
A real, genuine and bona fide dispute of fact can exist only where
the court is satisfied that the party who purports
to raise the
dispute has in his affidavit seriously and unambiguously addressed
the fact said to be disputed. There will of course
be instances where
a bare denial meets the requirement because there is no other way
open to the disputing party and nothing more
can therefore be
expected of him. But even that
may
not be sufficient if the fact averred lies purely within the
knowledge of the averring party and no basis is laid for disputing
the veracity or accuracy of the averment. When the facts averred are
such that the disputing party must necessarily possess knowledge
of
them and be able to provide an answer (or countervailing evidence) if
they be not true or accurate but, instead of doing so,
rests his case
on a bare or ambiguous denial the court will generally have
difficulty in finding that the test is satisfied.
I say ‘generally’ because factual averments seldom stand
apart from a broader matrix of circumstances all of which
needs to be
borne in mind when arriving at a decision. A litigant may not
necessarily recognise or understand the nuances of a
bare or general
denial as against a real attempt to grapple with all relevant factual
allegations made by the other party.
But
when he signs the answering affidavit, he commits himself to its
contents, inadequate as they may be, and will only in exceptional
circumstances be permitted to disavow them. There is thus a serious
duty imposed upon a legal adviser who settles an answering
affidavit
to ascertain and engage with facts which his client disputes and to
reflect such disputes fully and accurately in the
answering
affidavit.
If that does not happen it should come as no surprise that the court
takes a robust view of the matter.”
(emphasis
added.)
[28]
In motion proceedings the affidavits constitute both the pleadings
and the evidence and the issues and averments in support
of the
parties’ cases should appear clearly therefrom. See
Minister
of Land Affairs and Agricultural v D & F Wevell Trust
2008 (2) SA 184
(SCA) at 200D. It is trite that the applicant
in application proceedings must make out his or her case in the
founding affidavit.
That affidavit must contain sufficient
facts in itself upon which a court may find in the applicant’s
favour. An applicant
must stand or fall by his or her founding
affidavit. See
Director
of Hospital Services v Mistry
1979 (1) SA 626
(AD) at 635H – 636D.
[29]
There is no indication in the papers as to Seoke’s background,
in particular where he was employed before he became the
HOD of the
Department. Apparently he has no personal information as to the
processes embarked upon in order to eventually
award bids to Mofomo.
He had to rely on second-hand information, i.e. allegedly obtained
from perusing the Department’s
files. In my view it would
be totally inappropriate to rely on Seoke’s evidence, in
particular in so far as Mr Cassim
in his oral argument made an
unfortunate comment that Mofomo and employees of the Department were
possibly guilty of shenanigans
and even fraudulent conduct.
Nowhere in the papers is it alleged that Gasela and/or any other
employee(s) of the Department
and/or Mofomo committed fraud and/or
any other misconduct. I would have expected the Department to
obtain first-hand information
by means of an affidavit of Gasela
and/or Ms Raboroko and/or Mr Koko referred to
supra
.
If these employees were indeed involved in any wrongdoing during the
procurement process, it should have been stated and
detailed evidence
should have been provided which is not the case. The Department
also failed to obtain an affidavit of the
Chief Financial Officer
and/or Keyter, the engineer. Although the court
a
quo
did not make mention of the lack of evidence of these persons, I
shall during my evaluation
infra
consider
the failure to produce the best evidence.
[30]
Mr Cassim relied on
Goldblatt
v Freemantle
1920 AD 123
at 129 where the court found that when parties expressly
agreed that an arrangement made between them verbally should be
reduced
to writing, no contract was entered into between them in the
absence of proof that the written contract was signed by both.
Of course, as set out in
Goldblatt
at 130, a contract may be inferred from conduct, but every enquiry of
this kind depends upon its own facts. Mr Cassim submitted
further that Mofomo had to prove all the essentialia of the contract
relied upon, also where the Department pleaded a negative.
[31]
In
casu
the direct evidence indicates that Mofomo presented the Department
with a signed JBCC contract as well as the 10% construction
guarantee
whereupon the site was handed over and contract works started in
accordance with the bid awarded to it. Mr Cassim
was not
satisfied with Mofomo’s version under oath and insisted that it
should have provided proof of a JBCC contract, signed
by both
parties, and that a guarantee was in fact issued on its behalf.
Bearing in mind the relief sought by Mofomo and the
conduct of the
parties since 11 November 2015, it was in my view not necessary to
provide further proof. The
ipse
dixit
of
Mofomo’s deponent and managing member was sufficient
in
casu.
If
the Department wanted to put Mofomo’s evidence in contention,
it should have presented the evidence of those employees
that were
intimately linked to the project, to wit Gasela, Koko, Raboroko and
Keyter. I would have expected the Chief Financial
Officer in
particular to testify under oath in this regard. Instead the
Department preferred to rely on the second-hand evidence
of somebody,
apparently an outsider at the relevant time, who perused certain
unidentified files after the event. This is
exactly
what the Supreme Court of Appeal warned against in
Wightman
supra.
Having
read the affidavit of Seoke, it is uncertain whether the Department
opened a file for each and every separate project and
if that was the
case, what exactly was contained in the applicable file(s).
[32]
The mere fact that the Department allowed Mofomo to perform as it did
and to receive at least the first
interim
payment
is indicative that the Department was satisfied that a proper
vinculum
iuris
existed between the parties. The letter of appointment is an
acceptance of the offer made by Mofomo when it tendered for
the
contract. This constituted an agreement. See
Jicama
17 (Pty) Ltd v West Coast District Municipality
2006 (1) SA 116
(C) at paras [9] to [11] and para [14] of the court
a
quo
’s
judgment. It was nowhere contended by any of the Department’s
employees directly involved in the tender process
that any of the
suspensive conditions had not been met. Prior to the
institution of the legal processes herein, it was not
the
Department’s case that the contract was not valid and binding
because of the non-fulfilment of any suspensive conditions.
[33]
Notwithstanding the above findings there can be little doubt that the
bid documents detailed the obligations to be imposed
on a successful
bidder and Mofomo
in
casu.
On
all probabilities full details of the contract works would have been
provided failing which it would be impossible to submit
a bid.
Furthermore, the JBCC contract is a standard contract used in the
construction industry. Insofar as the JBCC
contract might have
been a more detailed document than the rights and obligations
contained in the bid documents, all that might
have happened in the
event of signature by both parties was that the JBCC contract would
supersede the agreement brought about
by the acceptance of Mofomo’s
bid. See
Jicima
supra
with
reference to
CGEE
Alsthom Equipments et Enterprises Electriques, South African Division
v GKN Sankey (Pty) Ltd
1987
(1) SA 81
(AD) at 92A – E and see also
Command
Protection Services (Gauteng) v SA Post Office
2013
(2) SA 133
(SCA) at para [12]. Insofar as Brand JA found in the
last-mentioned judgment at para [25] that the acceptance of the
particular
tender was not unconditional, but was intended by the
respondent and accepted by appellant as a counter-offer, I am of the
view
that the present matter is distinguishable. There was
nothing further to negotiate and Mofomo merely had to present the
Department
with a signed JBCC contract and construction guarantee
which it did. On all probabilities that contract was also
signed by
the HOD at the time. The Department also received the
construction guarantee as stated under oath, otherwise Mofomo would
not have been allowed to start with contract works and draw the first
progress payment.
[34]
Seoke did not have the power to revoke and repudiate the decision of
Gasela as he clearly did in his letter of 11 February
2016. The
Department was under a duty to approach the court for the review and
setting aside of the earlier decision.
Neither the HOD, nor the
MEC could ignore, revoke and/or repudiate the decision on the ground
that it was an invalid administrative
action. An administrative
decision must be treated as though it is valid until a court
pronounces authoritatively on its
invalidity. See
Kwa
Sani Municipality v Underberg
/
Himeville
Community Watch Association and Another
[
2015]
2 All SA 657
(SCA) at paras [14] and [15] and
MEC
for Health, Eastern Cape and Another v Kirland Investments (Pty) Ltd
t/a Eye and Laser Institute
2014
(3) SA 219
(SCA) at para [32]. In its counter-application the
Department was called upon to disclose the entire process followed
prior
to the appointment of Mofomo, the reasons for its decision and
all relevant documents. In the process the Department as an
organ of state seeking to repudiate its own administrative action
disobeyed the essential requirements for a review application.
The Department had to prove invalidity to the court
a
quo
,
but failed to do so.
[35]
Section 217 of the Constitution is the starting point for an
evaluation of the proper approach to an assessment of the
constitutional
validity of State procurement processes. It
reads as follows:
“
1.
When an organ of state in the national, provincial or local sphere of
government, or any other institution
identified in national
legislation, contracts for goods or services, it must do so in
accordance with a system which is
fair,
equitable, transparent, competitive and cost-effective
.
2.
Subsection
(1) does not prevent the organs of state or institutions referred to
in that subsection from implementing a procurement
policy providing
for - (a) categories of preference in the allocation of contracts;
and (b) the protection or advancement
of persons, or categories of
persons, disadvantaged by unfair discrimination.
3.
National
legislation must prescribe a framework within which the policy
referred to in subsection (2) must be implemented.”
(emphasis
added.)
[36]
In order to comply with s 217(3) the legislature adopted the
Preferential Procurement Policy Framework Act, 5 of 2000 (“the
PPPFA”). “Acceptable tender” is defined in s
1 of the PPPFA as
“
any
tender which, in all respects, complies with the specifications and
conditions of tender as set out in the tender document”
.
In
Chairperson:
Standing Tender Committee and Others v JFE Sapela Electronics (Pty)
Ltd and others
[2005] 4 ALL SA 487
(SCA) at paragraph [19] Scott JA pointed out that
the definition of
“
acceptable
tender”
must
be construed against the background of s 217 of the Constitution
and continued as follows:
“
In
other words, whether the tender in all respects complies with the
specifications and conditions set out in the contract documents
must
be judged against these values.”
[37]
A tender process implemented by an organ of state is an
“
administrative
action”
within
the meaning of the Promotion of Administrative Justice Act, 3 of
2000, (“PAJA”). See:
Logbro
Properties CC v Bedderson NO and Others
2003
(2) SA 460
(SCA) para [5]. Therefore Mofomo was entitled to a
lawful and procedurally fair process. Furthermore, it is well
established
that the executive in all spheres are constrained by the
principle that they may exercise no power and perform no function
beyond
those conferred upon them by law. This is the doctrine
of legality. See:
Sapela
Electronics
supra
at para [11].
[38]
The proper legal approach pertaining to procurement processes was set
out in the following
dictum
by Froneman, J in
Allpay
Consolidated v Chief Executive Officer, SASSA
2014 (1) SA 604
(CC) at para [22] which I quote:
“
[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 the 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 the consequences of setting the procurement
process aside.”
[39]
Froneman J continued in
All
Pay
supra
at
paras [28] and [29] to summarise the approach to be followed by a
court considering a review application and I quote:
“
The
proper approach is to establish, factually, whether an irregularity
occurred. Then the irregularity must be legally evaluated
to
determine whether it amounts to a ground of review under PAJA.
This legal evaluation must, where appropriate, take into
account the
materiality of any deviance from legal requirements, by linking the
question of compliance to the purpose of the provision,
before
concluding that a review ground under PAJA has been established.”
Once
this exercise has been completed the court must consider the
practical difficulties which may flow from declaring the
administrative
action constitutionally invalid, bearing in mind the
just and equitable remedies provided for in the Constitution and
PAJA.
[40]
In
Bel
Porto School Governing Body and Others v Premier, Western Cape
[2002] ZACC 2
;
2002 (3) SA 265
(CC) Chaskalson CJ stated at para [89] for a decision
to be justifiable,
“…
.
it should be a rational decision taken lawfully and directed to a
proper purpose.”
Ponnan
JA, relying on
Pharmaceutical
Manufacturers Association of South Africa and Another: In re Ex
Parte President of the Republic of South Africa
and Others
[2000] ZACC 1
;
2000 (2) SA 674
(CC) expressed himself as follows:
“
It
is well established that an incident of legality is rational
decision-making. It is a requirement of the rule of law that
the exercise of public power should not be arbitrary. It
follows that decisions must be rationally related to the purpose
for
which the power was given.”
See
Minister
of Home Affairs v Somali Association of South Africa
2015 (3) SA 545
(SCA) at para [18]. Nugent JA pointed out in
Minister
of Home Affairs and Others v Scalabrini Centre
2013 (6) SA 421
(SCA) at para [65] that:
“…
an
enquiry into rationality can be a slippery path that might easily
take one inadvertently into assessing whether the decision
was one
the court considers to be reasonable. As appears from the
passage above, rationality entails that the decision is
founded upon
reason - in contradistinction to one that is arbitrary - which
is different to whether it was reasonably made.
All that is
required is a rational connection between the power being exercised
and the decision, and a finding of objective irrationality
will be
rare.”
[41]
In
Metro Projects CC v Klerksdorp Local Municipality
2004 (1) SA 16
(SCA) Conradie JA said the following in para [13]:
“
In
the
Logbro
Properties
case
supra
,
paras [8] and [9] at 466H - 467C, Cameron JA referred to the
'ever-flexible duty to act fairly' that rested on a provincial tender
committee. Fairness must be decided on the circumstances of each
case. …… Whatever is done may not cause the process
to
lose the attribute of fairness or, in the local government sphere,
the attributes of transparency, competitiveness and
cost-effectiveness.”
See
also in this regard
Premier,
Free State and Others v Firechem Free State (Pty) Ltd
2000 (4) SA 413
(SCA) at para [30] in respect of the requirement that
competitors should be treated equally.
[42]
In
Westinghouse
Electric Belgium SA v Eskom Holdings (SOC) Ltd and another
2016 (3) SA 1
(SCA) the court reiterated at para [38] that fairness
in the procurement process is a value in itself and at para [39] that
proper
compliance with the procurement process is necessary for a
lawful process.
[43]
Wallis JA considered objectivity in tender adjudication processes as
follows in
South
African National Roads Agency Ltd v Toll Collect Consortium
2013 (6) SA 356
(SCA) at paras [20] – [22] (
“
SANRAL”
):
“
[20]
As
to objectivity
,
which is an aspect of the constitutional requirement that the public
procurement process be fair,
it
requires that the evaluation of the tender be undertaken by means
that are explicable and clear and by standards that do not
permit
individual bias and preference to intrude.
It does not, and cannot, mean that in every case the process is
purely mechanical. There will be tenders where the process is
relatively mechanical, for example, where the price tendered is the
only relevant factor and the competing prices are capable of
ready
comparison. The application of the formula for adjudicating
preferences under the PPPFA may provide another example. However,
the
evaluation of many tenders is a complex process involving the
consideration and weighing of a number of diverse factors. The
assessment of the relative importance of these requires skill,
expertise and the exercise of judgment on the part of the person
or
body undertaking the evaluation. That cannot be a mechanical process.
The evaluator must decide how to weigh each factor and
determine its
significance in arriving at an appropriate decision.
Where that occurs it does not mean that the evaluation
is not
objective. Provided the evaluator can identify the relevant criteria
by which the evaluation was undertaken and the judgment
that was made
on the relative importance and weight attached to each, the process
is objective and the procurement process is fair.
[21] Where
the evaluation of a tender requires the weighing of disparate factors
it will frequently be convenient for the
evaluator to allocate scores
or points to the different factors in accordance with the weight that
the evaluator attaches
to these factors. But the adoption
of such a system, without it being disclosed to tenderers in advance,
does not mean that
the tender process is not objective. If
anything, the adoption of the scoring system enhances the objectivity
of the process,
because, in the event of a challenge to the award of
the tender, the basis upon which the evaluation was undertaken
emerges clearly.
[22]
The prior disclosure of any such points system …..is not
ordinarily required, provided that the basic criteria
upon which
tenders will be evaluated are disclosed………..Disclosure
of any such refined process of scoring in
relation to a tender
evaluation will only be required if its non-disclosure would mislead
tenderers or leave them in the dark as
to the information they should
provide in order to satisfy the requirements of the tender.”
(emphasis
added).
[44]
An administrator is bound to the reasons given for his or her
decision. See
Transnet Ltd v Goodman Brothers (Pty) Ltd
[2000] ZASCA 151
;
2001 (1) SA 853
(SCA) at para
[10]
. The unsuccessful bidder has
the right to reasons in order to enable him or her to decide or
determine whether his or her
right to lawful administrative action
has been violated or not.
[45]
If an unsuccessful bidder would have launched review proceedings in
this particular instance, the Department would be duty-bound
to
present the review court with the record of decision, the reasons for
the decision and all relevant documents. In
casu
,
it is the Department that wanted to have its own decision reviewed
and set aside and there was no reason why it should not have
provided
the court
a
quo
with the record of decision, the reasons for the decision and all
relevant documents.
[46]
The following
dictum
is apposite in this regard and I quote
from
Jockey Club of South Africa v Forbes
1993 (1) SA
494
(AD) at 660D - F:
“
Not
infrequently the private citizen is faced with an administrative or
quasi-judicial decision adversely affecting his rights,
but has no
access to the record of the relevant proceedings nor any knowledge of
the reasons founding such decision. Were
it not for Rule 53 he
would be obliged to launch review proceedings in the dark and,
depending on the answering affidavit(s) of
the respondent(s), he
could then apply to amend his notice of motion and to supplement his
founding affidavit. Manifestly the procedure
created by the rule is
to his advantage in that it obviates the delay and expense of an
application to amend and provides him with
access to the record.”
[47]
The Department did not attempt to explain what has given rise to
Mofomo’s appointment and the reasons for such action.
As
mentioned, no primary and reliable evidence was tendered. The
closest approximation to such an enquiry is an allegation
of what was
not found. It appears that the Department did not play open
cards. In paragraph 16.4 of the answering affidavit
Seoke
referred under oath to
“
the
submission that was made by the officials, which was placed before
the bid adjudication committee and which recommended the
appointment
of the applicant”.
He
failed to inform us who these officials were, whether the submissions
were in writing or verbal and what exactly was submitted.
He
also failed to provide us with the minutes of the meeting of the bid
adjudication committee, but we at least know that this
committee
received submissions and recommended Mofomo’s appointment.
Surely, it must have been in writing for Seoke
to obtain knowledge of
this. Seoke failed to identify the members of the bid
adjudication committee. The dearth of
evidence, especially
direct, cogent and reliable evidence, cannot be sufficient to come to
the assistance of an organ of state
who alleges that an improper
procurement process was embarked upon to such an extent that the
process could not be regarded as
fair, equitable, transparent,
competitive and cost-effective as provided for in section 217 of the
Constitution read with all other
applicable legislation and
regulations. The court
a
quo
was
correct in finding at paragraph [19], while adopting the reasoning of
the Constitutional Court in
Kirland
quoted
infra
,
that Mofomo was entitled to be told fully, and provided with all
relevant documents and evidence, why the contract was regarded
unlawful and unenforceable. I refer again to the test to be
applied in application procedure explained in
Wightman
supra.
[48]
The mere fact that public bids were not invited through advertisement
in the Government Tender Bulletin as a procurement method
did not
mean that a competitive process was not followed. It is
apparent that the Department was entitled to solicit tenders
in
accordance with notice
BN187 of 11 September 2015: Standard
for Uniformity in Construction Procurement
published in
Government Gazette No 39204 in consequence of the Construction
Industry Development Board Act, 38 of 2000 (“the
CIDB Act”).
Sections 4(f), 5(3)(c) and 5(4)(b) authorise the Board to publish and
determine the standards fit for procurement
in the construction
industry. Subsections 4.2.1.1 and 4.2.1.2 deal with the
soliciting of bids in accordance with Tables
1, 2 and 3. Table
1, for instance, deals with standard procurement procedures and
describes three different ways in which
a bid can be procured.
Table 3 describes the several methods, procurement procedures and
evaluation methods to be followed
in respect of different classes of
construction contracts. Treasury regulation 16A contains
general requirements and must
be read with the CIDB regulations and
prescriptions as far as standard procurement rules are concerned.
Advertisements for
bidders to submit bids in respect of construction
works contracts in particular shall be placed on the cidb website in
terms of
these procurement rules. Therefore, unlike as stated
under oath and submitted on behalf of the Department, advertisements
in the Government Tender Bulletin were not required. The
Department has in any event the authority to deviate from general
standards and prescriptions. In
Kwa Sani
supra
the court found at para [21] as follows:
“
The
association submitted that, although a public bidding process
admittedly did not take place, this did not necessarily mean that
s
217 of the Constitution and the provisions of the MFMA and
regulations had not been complied with. It pointed out that
regulation
36 of the regulations clearly demonstrates that a public
bidding process is not always necessary.”
And
also at para [27]:
“
Qaukeni
is therefore not authority for the proposition that, in all instances
where a municipality concludes an agreement with an
outside body for
the provision of services, a public bidding process is required.”
[49]
In evaluating the evidence it must also be taken into consideration
that Mofomo as an independent contractor and thus an outsider
would
not know precisely what processes were followed within the Department
for the procurement of the particular services.
It is precisely
for this reason that a record of decision is required from the
functionary/organ of state whose decision is to
be reviewed and set
aside. In
casu
the Department wanted its own decision to be set aside and it was
incumbent upon it to place all relevant documents and evidence
before
the court
a
quo
which it manifestly failed to do. Its failure to do so
made it impossible for the court
a
quo
to
find in favour of the Department, i.e. that its procurement process
was not in material compliance with all legal requirements
set out in
the authorities quoted
supra.
[50]
Kirland
supra
was taken on appeal to the
Constitutional Court and in
MEC for Health, Eastern Cape and
Another v Kirland Investments (Pty) Ltd t/a Eye and Laser Institute
2014 (3) SA 481
(CC) at para [65] Cameron J held as follows:
“
When
government errs by issuing a defective decision, the subject affected
by it is entitled to proper notice, and to be afforded
a proper
hearing, on whether the decision should be set aside.
Government should not be allowed to take short cuts.
Generally,
this means that government must apply formally to set aside the
decision. Once the subject has relied on a decision,
government
cannot, barring specific statutory authority, simply ignore what has
been done. The decision, despite being defective,
may have
consequences that make it undesirable or even impossible to set it
aside. That demands a proper process, in which
all factors for
and against are properly weighed.”
[51]
The effect of the last two sentences of the quotation in the previous
paragraph is that the enquiry does not stop simply at
whether the
appointment was unlawful. The court must upon a declaration of
invalidity make an order in terms of s 8 of PAJA,
according to what
justice and equity dictate. See
Allpay
Consolidated Investment Holdings (Pty) Ltd and Others v Chief
Executive Officer, South African Social Security Agency and
Others
2014 (4) SA 179
(CC) (the second Allpay judgment) at para [61] and
further. In
casu
the Department’s simple allegation that no valid tender process
was followed is in itself insufficient and it was not even
necessary
to consider a just and equitable remedy consequent upon a finding of
unlawfulness. See
Kwa
Sani
supra
.
[52]
There is no merit in any of the grounds of appeal.
VII
CONCLUSION
[53]
The above evaluation can lead to only one conclusion and that is that
the appeal cannot succeed and
should be dismissed with costs.
VIII
ORDER
[54]
Consequently the following order is issued:
1.
The
appeal is dismissed with costs.
______________
J. P. DAFFUE, J
I concur.
________________
L.J.
LEKALE, J
I
concur.
_____________
S.P.B. HANCKE, J
On
behalf of the appellant: Adv. N. A. Cassim SC
with
Advocates B. Mene and
N.
Khooe
Instructed
by:
State
Attorney
BLOEMFONTEIN
On
behalf of the respondent: Adv. S. Grobler
Instructed
by:
Graham
Attorneys
BLOEMFONTEIN
/eb