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
>>
2015
>>
[2015] ZAFSHC 238
|
|
HT Pelatona Projects (Pty) Ltd v Tokologo Local Municipality and Another (A224/2015) [2015] ZAFSHC 238 (3 December 2015)
FREE STATE HIGH
COURT, BLOEMFONTEIN
REPUBLIC
OF
SOUTH AFRICA
Case
No. : A224/2015
In
the matter between:-
HT
PELATONA PROJECTS (PTY)
LTD
Applicant
and
TOKOLOGO
LOCAL
MUNICIPALITY
1
st
Respondent
MAGIC
LABOUR HIRE & SECURITY SERVICES CC
2
nd
Respondent
CORAM:
KRUGER
et
MOLOI, JJ
HEARD
ON:
23
NOVEMBER 2015
JUDGMENT
BY:
KRUGER,
J
DELIVERED
ON:
3
DECEMBER 2015
[1]
This is a tender review. The applicant wants us to set aside
the award of a tender for water treatment works at Boshoff
to the
second respondent. The matter started as an application for an
urgent interdict but the parties agreed to suspend
the work and
settled dates for this review. Mr Grobler appeared for the
applicant, Mr Mnyandu for the first respondent (the
Municipality that
awarded the tender) and Mr Snyman for the second respondent, the
tenderer to whom the tender was allocated, being
Magic Labour Hire
and Security Services CC.
[2]
The question in this review is whether the non-compliance of the
second respondent with certain mandatory tender requirements
was such
that its tender should have been declared non-responsive. The
applicant’s case is that it should have been
declared
non-responsive, and should not have been considered at all. The
respondents say the non-compliance with the requirements
was not
serious and could have been condoned. This review is unusual
because not all the tenders are before us, only that
of the second
respondent. The respondents chose not to place the other
tenders before court.
The
History of the Tenders
[3]
The first respondent called for tenders for a 4,5 mega litre water
treatment works plant at Boshoff to be submitted by 1 July
2015.
The first step in the consideration of tenders is that the Bid
Specifications Committee (BSC) considers specifications
and
documentation in the tender and submits a report and recommendation
to the Municipal manager. In this case nothing turns
on what
the BSC did. Thereafter the Bid Evaluation Committee (BEC)
evaluates the tenders and makes a report to the Bid Allocation
Committee (BAC). In this case the BEC made its report on 24
July 2015. The BEC found the bids of both applicant and
second
respondent responsive. It reported that several bidders,
including applicant and second respondent should be considered
for
appointment.
[4]
The first respondent, through its municipal manager, appointed the
second respondent on 7 September 2015. The letter of
appointment states that the project duration is 12
months
and also contains the following:
“
The
following contractual obligations should be met within 14 days of
commencement date of the project.
Guarantee
10% and copies of insurance policy together with receipts for the
payment of premiums and of continuity of the policies
with 14 days of
the commencement date.
Construction
programme within 14 days of the commencement date.
A
detail health and safety plan with14 days.
”
The
Aurecon Report
[5]
In its founding affidavit applicant relied on a report prepared by
Aurecon, who are the engineers of the municipality.
The
municipality never asked Aurecon for a report. Mr Mnyandu, for
the first respondent pointed out that the three committees
considered
the application. They are (i) The Bid Specification Committee,
(ii) The Bid Evaluation Committee, (iii) The Bid
Adjudication
Committee. (As set out in the Supply Chain Management and
Preferential Procurement Code of Good Practice, para
4.14 (page
335)). The Bid Evaluation Committee does not have
the power to delegate to other bodies. The
applicant does not
explain how the Aurecon report got before the Bid Evaluation
Committee. In the light of the statement
by the first
respondent that it did not request the Aurecon report, the applicant
should have obtained an affidavit from Aurecon
to explain its
existence and presence at the Bid Evaluation Committee. The
Aurecon report has no status and the recommendations
and conclusions
therein should carry no weight. This review must be assessed on
the facts before the Bid Evaluation Committee.
Applicant’s
BBBEE Status
[6]
The BAC left applicant’s BBBEE status out of consideration and
awarded it 57,09 for price and 0 HDI points. The
BAC awarded
the second respondent 76,30 points for price and 8 HDI points, giving
a total of 84.3. The tenderer with the
lowest price, Bankurp
Engineering and Construction, who had 99 points was deemed to pose
the highest risk and its price was too
low. Thus the BAC
recommended the appointment of the second respondent.
[7]
The applicant contends that the first respondent erred in rejecting
its BBBEE status report. The applicant’s HDI
status
report was rejected because it was not issued by an agency accredited
by SANAS. Para 5.3 of the Form of Tenders also
provides for a
certificate issued by an Auditor. Applicant complied.
That report by the Auditor should have been accepted
by the BAC.
According to that report applicant has a level 5 status, which would
give it 4 HDI points. The BAC gave
applicant 57.09 points on
price. If it were to add 4 HDI points, applicant would get
61.09 total. That is still less
than the total of second
respondent being 76.30. It is thus necessary to consider
whether the Bid of the second respondent
should have been considered
responsive by the BAC and the first respondent.
Applicant’s
Contentions
[8]
It is applicant’s case that the tender of second respondent
should have been found to be non-responsive due to material
omissions.
[9]
In the Conditions of Tender the following appears:
“
F.3.13
Tenders will only be accepted if:
(a)
the Tenderer submits
an
original valid
Tax Clearance Certificate issued by the South African Revenue
Services or has made arrangements to meet outstanding tax
obligations;
(b)
the Tenderer submits a letter of intent from an approved insurer
undertaking to provide
the Performance Bond to the format included in
Part T2.2 of this procurement document;
(c)
the Tenderer is registered with the Construction Industry Development
Board in an appropriate
contractor grading designation;
(d)
the Tenderer or any of its directors/shareholders is not listed on
the Register of Tender
Defaulters in terms of the
Prevention and
Combating of Corrupt Activities Act of 2004
, as a person prohibited
from doing business with the public sector;
(e)
the Tenderer has not;
(i)
abused the Employer’s Supply Chain Management System; or
(ii)
failed to perform on any previous contract and has been given a
written notice to this effect;
(f)
the Tenderer has completed the Compulsory Enterprise Questionnaire
and there are no
conflicts of interest which may impact on the
Tenderer’s ability to perform the Contract in the best
interests of the Employer
or potentially compromise the tender
process;
(g)
the Tenderer is registered and in good standing with the compensation
fund or with a licensed
compensation insurer;
(h)
the Employer is reasonably satisfied that the Tenderer has in terms
of the Construction
Regulations, 2014, issued in terms of the
Occupational Health and Safety Act, 1993
, the necessary competencies
and resources to carry out the work safely.
(i)
the Tenderer has not failed to perform on any previous contracts and
has not been
given a written notice to this effect.
(j)
the Tenderer need to provide a Valid Municipal Rates & Taxes
Certificate,
Valid Lease Agreement (If renting) and Latest Municipal
Account for Entities Operating outside Tokologo Local Municipality.
”
These
requirements are worded in mandatory terms.
[10]
There is also the requirement for submission of a Day Work Schedule:
“
The
Tenderer shall insert in this Daywork Schedule the rates for the use
of such Construction Equipment as he proposes to have available
upon
the Site to use for daywork.
”
[11]
Mr Grobler, for applicant, contends that second respondent did not
submit a number of documents, and its bid should have been
declared
non-responsive. The main documents in question are:
(i)
Letter of intent to provide a performance bond.
(ii)
Lease agreement.
(iii)
Day work schedule.
(iv)
Municipal rates certificate.
I deal
with these seriatim:
(i)
Letter of Intent (F.3.13(b))
[12]
In terms of paragraph F.3.13(b) of the Conditions of Tender, a
tenderer must submit a letter of intent from an approved insurer
undertaking to provide a performance bond in the format in paragraph
T2.17. This document is listed in T2.2 as one of the
“Returnable Schedules required for Tender Evaluation Purposes”.
Form
A10 reads as follows:
“
CERTIFICATE
OF INSURANCE COVER
N
ote to Tenderer:
In the event of the
Tenderer being a joint venture/consortium, the details of the
individual members must also be provided.
The Tenderer shall
provide the following details of this insurance cover:
(i)
Name of Tenderer:
(ii)
Period of Validity:
(iii)
Value of Insurance:
·
Insurance
for Works and Contractor’s equipment
Company:................................................................................
Value:......................................................................................
·
Insurance
for Contractor’s personnel
Company:
...............................................................................
Value:......................................................................................
·
General
public liability
Company:
...............................................................................
Value:......................................................................................
·
SASRIA
Company:
...............................................................................
Value:.....................................................................................
”
[13]
The document attached to the tender of the second respondent reads as
follows:
“
05
August 2014
Dear Sir/Madam
LETTER OF INTENT
Employer
Contractor
Magic
Labour Hire & Security Services
Contract
Number
Description
This serves to confirm
that Fusion Guarantees (Pty), issued a credit facility for
Magic
Labour Hire & Security Services
, we shall therefore issue a
performance guarantee should the contractor be awarded the project.
We trust the above to be
in order.
Yours sincerely
ILSE BECKER
DIRECTOR
_______________________________________________________________
Fusion
Guarantees (Pty)
”
[14]
The applicant says that the second respondent failed to provide the
requisite letter of intent. To that allegation the
second
respondent says:
“
Ad
paragraph 13.6 thereof
The
content hereof is denied. This document was attached to the
back of the tender bundle of documents submitted in respect
of the
tender. This is a separate letter of intent and is not on the
prescribed documents that could be supplied. A
copy thereof is
attached hereto as Annexure “B2”.
”
The
document at page 693 (“B2”) reads as follows:
“
Tokologo
Municipality
Private Bag X46
Boshof
8340
25 June 2015
Dear Sir
LETTER OF INTENT
Employer
Tokologo
Municipality
Contractor
Magic
Labour Hire and Security Services cc
Tender
Number
TLM/BWSBD/WTW/02
Tender
Amount
R 24 000 000.00
Description
Construction
of a new 4.5ML Water Treatment Plant in Boshof
This serves to confirm
that
Fusion Guarantees (Pty) Ltd
, will issue a credit facility
for
Magic Labour Hire and Security Services cc
, we shall
therefore issue a Performance Guarantee for the above contract once
all the security requirements have been met.
We trust the above to be
in order.
Yours sincerely
ILSE BECKER
DIRECTOR
_________________________________________________
Fusion
Guarantees (Pty) Ltd
”
[15]
The answer of the respondent is that the document by Fusion refers to
the tender, and suffices for purposes of the tender and
that the fact
that the document at page 693 of the record dated 25 June 2015
differs from the document at page 336 of the record
attached to the
tender dated 5 August 2014 is immaterial, because the tender number
is correct and the same in both.
(ii)
Lease Agreement
[16]
The second respondent’s deponent and sole member says there is
no written lease agreement between him, as owner of the
premises and
the second respondent as tenant:
“
24.
Ad paragraph 10.4
thereof
I take
note of the content hereof. It should, however, be taken into
consideration that a tenderer can only submit what it
has. The
rates account of myself was attached. I am the owner of the
property. Therefore the account is registered
in my name as per
the Municipality’s requirements. There is no written
lease agreement between the applicant close
corporation of which I am
the sole member. To enter into such a written agreement would
be ridiculous in the circumstances.
I can therefore not attach
a written agreement. The property is a business premises and
occupied by the Second Respondent.
Second Respondent has
attached all the documents it should.
”
[17]
As to the absence of the lease agreement, Mr Snyman, for the second
respondent submitted that the second respondent has an
oral lease
with its sole director who owns the property it does business from.
(iii)
Day Work Schedule
[18]
It is not in dispute that the second respondent did not provide a day
work schedule as required in the Conditions of Tender.
In its
supplementary answering affidavit first respondent says:
“
Ad
paragraph 10.14 to 10.15
54.
I admit that the second respondent did not provide a day work
schedule. I refer to the above
response in this regard as such
information falls under the practicalities and programmes for
implementation.
55.
The municipality was satisfied that the second respondent did hold a
plant hire account which
is up-to-date with an entity styled Umzinto
Civils and Plant Hire. This entity did confirm an arrangement
they had with the
second respondent.
56.
Where costs of plant hire and other equipment are involved, the
necessary costing is found in
the bills of quantities, a copy of
which is found in the second respondent’s bid submission.
57.
It incorrect, and therefore denied, that an indication on monthly
expenditure is one of the tools
used to determine responsiveness of
bids. The BSC of the municipality prepared a checklist
schedule, for this purpose, that
was used on all the bids without
exception. Aurecon’s input in this regard was unnecessary
and undesired.
”
The
applicant says that the second respondent’s price could not
have been validly considered in the absence of estimated duration
of
the contract.
Applicant
says in reply:
“
40.
Ad paragraph 52 and
53:
40.1
The answer presented in this paragraph is significant.
40.2
The court will remember that I had explained (and this has not been
seriously disputed) that the responsiveness
of the bid cannot be
determined if there is no indication of monthly expenditure, and
moreover, where the bidder does not state
how long it will take him
or her to perform the works at issue. Exactly because there are
items tendered on a time related
basis, the time spent on the
construction site is directly relevant so as to determine if the
tender price is responsible.
This evidence I gave in my
founding affidavit has not been gainsaid.
40.3
The issue is not the ‘
holding
to’
of any such a contractor to the estimates. It is the evaluation
of the bid (after it is opened) for responsiveness that is
in issue.
With much respect, the Municipal Manager misses the point.
”
[19]
As to the day work schedule, Mr Snyman pointed out that in second
respondent’s tender payment is made for the work done,
and
therefore it is possible to assess the costs of second respondent’s
tender without a day time schedule.
(iv)
Municipal Rates Certificate
[20]
Applicant’s case is that the bid of second respondent should
not have been considered at all. The main reason is
that the
rates clearance certificate of second respondent was not before the
committee. This concern is addressed by the
first respondent as
follows in the supplementary affidavit:
“
38.
The requirement in F.3.13 requires a copy of municipal rates and
taxes. I admit that the second
respondent submitted a copy of
rates and taxes bearing the name of its director and shareholder.
39.
It is also the unexpressed intention of the municipality to verify
the standing of the directors
of entities that bid for goods and
services, in respect of payment of municipal services, tax status and
general financial status,
whether they are insolvent or not.
40.
The bid committees condoned the scanty compliance with this
requirement for all bidders, including
the applicant.
”
[21]
The standard conditions of tender contains the following under
paragraph (j) of F.3.13:
“
(j)
the Tenderer need to provide a Valid
Municipal Rates & Taxes Certificate, Valid Lease Agreement
(If
renting) and Latest Municipal Account for Entities Operating outside
Tokologo Local Municipality.
”
[22]
It is not in dispute that the second respondent, the close
corporation Magic Labour Hire and Security Services CC, did not
provide a municipal rates certificate. There is no rates
account which the municipality sends to the second respondent,
because the deponent, Mr Baloyi, as owner of the premises pays the
municipal account for the premises leased by the second respondent.
In the tender of the second respondent in the record of the decision,
page 30, the tenderer is not described as a CC. Baloyi
is
described as its “MD”. The Municipal Account is
sent to Baloyi.
[23]
The applicant in its supplementary founding affidavit says the
following about this Municipal Certificate:
“
10.4
Clause F.3.13 (p 13 of the ROD) clearly obligates and casts as
threshold requirement the submission of a valid Municipal
rates and
taxes certificate. If the tenderer rents a premises, a valid
lease agreement is to be put up as well as ‘
the
latest Municipal account for entities operating outside Tokologo
Local Municipality
’.
10.5
This requirement deals with the tenderers’ tax affairs.
This is the reason behind the requirement
and quint-essentially
because no state contract may be awarded to a party that has fallen
behind with its tax obligations.
10.6
As found by Aurecon, Magic Labour Hire did not submit such a
certificate. A tax invoice was put up
(see p. 312) for TC
Baloyi by the Emfuleni Local Municipality. This however was
insufficient, for the following reasons:
10.6.1
Mr Baloyi, as far as I could gather, is a functionary of Magic Labour
Hire. The issuing of a tax invoice for him does
not mean that
the tax affairs of Magic Labour Hire are in order.
10.6.2
Secondly, and if Magic Labour Hire’s business is conducted from
the same premises (52 A Rhodes Avenue) it means that
a valid lease
agreement must have been put up. There is no such an agreement
in the ROD and none was submitted.
”
The
first respondent says in answer:
“
Ad
paragraph 10.4
32.
I deny the imputation that clause F.3.13 created an option or choice
of documents to be submitted.
As I have demonstrated herein
above, the applicant also did not fully comply with this clause.
33.
The applicant is deliberately oblivious of the fact that it is an
entity operating outside of
Tokologo Local Municipality.
Therefore, requests and demands made to these entities included the
applicant.
Ad paragraph 10.5
34.
What the applicant says here is correct, but it leaves out that the
requirement of submitting
tax certificates in F.3.13 is joined with
the requirement to submit valid municipal rates, the two being joined
by ‘and’.
Ad paragraph 10.6
35.
In addition to the contention that Aurecon’s report enjoyed no
status in the procurement
process under this tender, the applicant is
deliberately misleading this Honourable Court. The second
respondent did as matter
of fact submit its tax certificate.
The mentioned finding of Aurecon is another instance indicating that
this report is inaccurate,
biased and was prepared with bad
intentions.
Ad paragraph 10.6.1
36.
I deny the contents in this paragraph. Mr Baloyi is not a functionary
of the second respondent.
He is the director and shareholder of
the second respondent.
37.
I have stated that the second respondent did submit a valid tax
certificate.
Ad paragraph 10.6.2
38.
The requirement in F.3.13 requires a copy of municipal rates and
taxes. I admit that the
second respondent submitted a copy of
rates and taxes bearing the name of its director and shareholder.
39.
It is also the unexpressed intention of the municipality to verify
the standing of the directors
of entities that bid for goods and
services, in respect of payment of municipal services, tax status and
general financial status,
whether they are insolvent or not.
40.
The bid committees condoned the scanty compliance with this
requirement for all bidders, including
the applicant.
Ad paragraph 10.7
41.
I deny the allegations in this paragraph. I reiterate that a
disqualification on the basis
of non-compliance with the requirement
in question, firstly, would have meant that no bids would have been
left for consideration,
secondly, the municipality’s services
under the tender would have been delayed, thirdly, the bid committees
in their wisdom
considered such non-compliance as non-essential and
not material to the tender and the project generally.
42.
The municipality has a right in terms of paragraph F.1.5 of the
tender to accept any variation
or deviation.
43.
In addition to the above, and more pertinent, paragraph 13.1 of the
municipality’s Supply
Chain Management policy empowers the
authorised person, within the municipality, to accept any bid offer
notwithstanding the fact
that such offer does not conform to the
conditions or specification set out in the bid document.
”
The
second respondent says:
“
23.
Ad paragraph 10.3
thereof
The content hereof is
admitted in so far as it corresponds with what is stated at paragraph
F.3.8.1 referred to above.
24.
Ad paragraph 10.4
thereof
I take
note of the content hereof. It should, however, be taken into
consideration that a tenderer can only submit what it
has. The
rates account of myself was attached. I am the owner of the
property. Therefore the account is registered
in my name as per
the Municipality’s requirements. There is no written
lease agreement between the applicant close
corporation of which I am
the sole member. To enter into such a written agreement would
be ridiculous in the circumstances.
I can therefore not attach
a written agreement. The property is a business premises and
occupied by the Second Respondent.
Second Respondent has
attached all the documents it should.
25.
Ad paragraph 10.5
thereof
The
content hereof is denied. The tax affairs are defined in the
regulations to the Preferential Procurement Policy Framework
Act, Act
No 5 of 2000 (“PPPFA”) and furthermore in the tender
document itself. They do not include any municipal
rates or
taxes.
26.
Ad paragraph 10.6
thereof
The
content hereof is denied. The document from the Emfoleni
Municipality is correct and I have already explained what the
situation is. There is no written lease agreement. In law
I am advised that it is also not necessary to have such written
lease
agreement. That does not detract from the validity of such an
agreement.
27.
Ad paragraph 10.7
thereof
The
content hereof is denied. A rates clearance certificate could
not have been attached. It specifically refers to
entities
situated outside the First Respondent’s municipal area where
only a rate and taxes account needs to be attached
and a valid lease
agreement. There is no written lease agreement and therefore
the documents attached are correct.
In any event the
Municipality accepted it in its discretion as referred to above as
compliance with the relevant requirement.
”
In
its further reply applicant says:
“
31.2
Paragraph 39 is correct. Magic Labour Hire’s bid was thus
evaluated on ‘unexpressed intentions’
of the
Municipality. This vitiates the entire process. The call
for tenders must be clear on its terms and state exactly
to all
renderers what is required. These are essential attributes of
fair bidding.
31.3
The Municipality cannot evaluate the bid on an unexpressed intention
and vague requirements. This is
simply not permitted.
”
In
the further replying affidavit, applicant’s deponent also says:
“
15.3
In any event, these allegations are factually incorrect. HT
Pelatona submitted a Municipal Rates and Tax
Certificate which
indicated that its local tax affairs are in order. There was
nothing else that was required. What
exactly is meant herein is
certainly not explained.
15.4
The difference then between HT Pelatona and Magic Labour hire is that
it submitted such a certificate, and
the second respondent did not
(at all).
”
Responsiveness
[24]
The test for responsiveness is contained in the Standard Conditions
of Tender annexure “F” in para
F3.8:
“
F.3.8.1
Determine, after opening and before detailed evaluation, whether each
tender offer properly received:
(a) complies with
the requirements of these Conditions of Tender,
(b) has been
properly and fully completed and signed, and
(c)
is responsive to the other requirements of the tender documents.
F.3.8.2
A responsive tender is one that conforms to all the terms, and
specifications of the tender documents
without material deviation or
qualification. A material deviation or qualification is one
which, in the Employer’s
opinion, would:
(a) detrimentally affect
the scope, quality, or performance of the works, services or supply
identified in the Scope of Work,
(b) significantly
change the Employer’s or the tenderer’s risks and
responsibilities under the contract, or
(c)
affect the competitive position of other tenderers presenting
responsive tenders, if it were to be rectified.
Reject
a non-responsive tender offer, and not allow it to be subsequently
made responsive by correction or withdrawal of the non-conforming
deviation or reservation.
”
The
words “The Employer must” should probably be inserted
before the last phrase, so as to read:
“
The
Employer must reject a non-responsive tender offer...”
Applicant’s
view on responsiveness is as follows:
“
...
Either
a bid is responsive or it is not. If it is unresponsive, it
must be declared as such. The Municipality does not
have an
unfettered discretion or capability to declare adequate what is
inadequate. This is not permitted in a fair, equitable
and
transparent tender process. Where is the line drawn?
”
Discretion
[25]
The answer of the respondents is that there is a discretion.
The words “in the Employer’s
opinion” in the last sentence of the introductory part of para
F3.8.2 confer a discretion.
[26]
Mr Snyman says the ultimate test is whether the absence of the
documents and the information places a risk on the municipality.
The deliberations show that the first respondent considered all
documents. It is true that the municipal manager’s
initial response was that the required documents of the second
respondent were there, and later he said the absence of the documents
was condoned. He was not part of the decision-making body,
namely the bid. Mr Snyman cautioned against the approach
to
look only at the fact that a specific document of a tenderer (i.e.
the second respondent) was there or was adequate. All
the
tenderers and all the documents of each tenderer should be considered
to decide upon weight to be attached to the absence of
deficiency of
a particular document in a specific tender. This appears to be
a sensible approach.
Assessing
the non-compliance
[27]
Mr Mnyandu, for first respondent says, with reference to
Allpay
Consolidated Investment Holdings (Pty) Ltd, and Others v Chief
Executive Officer, South African Social Security Agency, and
Others
2014 (1) SA 604
(CC) par [28] that the first enquiry is to establish,
factually, whether an irregularity occurred. Then the
irregularity
must be legally evaluated to determine whether it
amounts to ground for review under PAJA. This evaluation takes
into account
the purpose of the provision. The law permits
condonation of non-compliance where condonation is not incompatible
with the
public interest and if such condonation is granted by the
body in whose benefit the provision was enacted. (
Allpay
para [17]). The respondents contend that the requirement for
the documents of the municipality taxes are for the benefit
of the
first respondent, and the requirement can be waived by it.
[28]
Mr Grobler, for applicant contends that a person can only waive
something of which that person is aware. You cannot condone
an
irregularity if you are unaware of the irregularity. Mr Grobler
says the first respondent cannot rely on the exercise
of a discretion
when the facts show that no discretion was exercised.
Conclusion
[29]
The question when there is a change in the version of the
decision-maker is whether that attitude shows that the matter was
not
properly considered. One cannot condone something you are
unaware of. The Bid Adjudication Committee should have
noticed
the deficiencies in the documentation of the second respondent.
[30]
The most serious objection to the tender of the second respondent is
the absence of proof that it has paid the municipal fees
and taxes
for the premises from which it does business. The second
respondent filed a tax clearance certificate which was
issued by the
South African Revenue Service to “Magic Labour Hire and
Security Services CC” (record page 284).
All the previous
contracts it refers to were in the name of Magic Labour Hire and
Security Services, not in the name of its member,
Mr Baloyi. The
omission of a lease agreement was serious, also because the second
respondent did not say a word about an oral lease.
This was a
material omission. The letter of intent does not conform to the
prescribed form, and all details required were
not furnished.
[31]
From the papers it is clear that the BAC did not notice that there
was no municipal rates certificate in the name of the second
respondent. That was the omission of a mandatory document.
Before a tender can be allocated to a tenderer, the employer
must be
satisfied that fees due to the municipality by it have been paid up
to date, or, being aware of such omission, consciously
decide to
condone the omission. The BAC and the municipal manager did
also not notice the defects relating to the other documents
detailed
above. In this case the BAC and the municipal manager were
initially not aware of the absence of the documents,
did not condone
their absence and could not have been so satisfied. The bid was
allocated to the second respondent without
proper consideration.
The Bid of the second respondent should have been declared
non-responsive. The decision of the
first respondent to appoint
the second respondent should be set aside.
Costs
[32]
This application was originally brought as one for an urgent
interdict to stop the second respondent from continuing with a
tender. On 25 September 2015 it was postponed by agreement to
23 October 2015. Costs of that day were costs in the
application.
[33]
On 23 October 2015 an order was made by agreement that further work
under the contract be suspended and that the matter be
further dealt
with as a review in terms of Rule 53. Costs of 23 October 2015
were reserved, and the matter was enrolled for
23 November 2015, the
day we heard argument by counsel for the applicant, first and second
respondents.
[34]
There is no basis to make any differentiation as to the costs order
for 23 October 2015.
ORDER
1.
The first respondent’s believed decision to declare as
responsive the second respondent’s
bid in the adjudication
process related to Contract No.
TLM/BWSBD/WTW/02
– Construction of an new 4,5 ml/day Water Treatment Work is
reviewed and set aside.
2.
The first respondent’s decision to award the contract mentioned
in prayer 1 above to the
second respondent is reviewed and set aside.
3.
In terms of
section 8
of the
Promotion of Administrative Justice Act
3 of 2000
:
3.1
any contract, and any right to a contract that may flow from the
decision impugned herein between the respondents
is set aside;
3.2
the decision is remitted to the first respondent for reconsideration
of the applicant and second respondent’s
bids, and the awarding
of the contract afresh.
4.
The first and second respondents are ordered to pay the costs of the
application jointly and severally,
payment by one, the other to be
absolved (such costs to include the costs occasioned by the
launching, prosecution and arguing
of the interdict proceeding on 23
October 2015).
_____________
A.
KRUGER, J
I
agree.
_____________
K.
J. MOLOI, J
On
behalf of applicant:
Adv S Grobler
Instructed
by:
Peyper Attorneys
BLOEMFONTEIN
On
behalf of first respondent:
Adv K Mnyandu
Instructed
by:
Molefi Thoabala Inc.
BLOEMFONTEIN
On
behalf of second respondent:
Adv M Snyman
Instructed
by:
Symington & De Kok
BLOEMFONTEIN
/wm