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[2013] ZAGPPHC 189
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Cervanties Trading CC v City of Tshwane Metropolitan Municipality and Others (35410/13) [2013] ZAGPPHC 189 (3 July 2013)
NOT
REPORTABLE
IN THE HIGH COURT OF SOUTH AFRICA
(NORTH
GAUTENG HIGH COURT)
Case
Number: 35410/13
DATE:03/07/2013
In
the matter between:
CERVANTIES
TRADING
CC
...............................................................................
APPLICANT
and
CITY
OF TSHWANE
METROPOLITAN
....................................................
1st
RESPONDENT
MUNICIPALITY
THE
MUNICIPAL MANAGER OF THE CITY OF
…...............................
2nd
RESPONDENT
TSHWANE
METROPOLITAN MUNICIPALITY
THE
EXECUTIVE DIRECTOR:
WASTE
…............................................
3rd
RESPONDENT
MANAGEMENT
OF THE CITY OF TSHWANE
METROPOLITAN
MUNICIPALITY
THE
STAREGIC EXECUTIVE
DIRECTOR:
...........................................
4th
RESPONDENT
ENVIRONMENTAL
MANAGEMENT SERVICES
OF
THE CITY OF TSHWANE METROPOLITAN MUNICIPALITY
THE
MUNICIPAL MANAGER OF THE CITY OF
…................................
5th
RESPONDENT
MPACK
PLASTIC CONTAINERS (PTY) LTD
Coram:
HUGHES AJ
REASONS FOR JUDGMENT
Order
made on: 14 June 2013
Reasons
delivered on: 3 July 2013
Heard
on: 14 June 2013
HUGHES
AJ
1.
I encountered this matter in the urgent court on 14 June 2013 and the
following order was made:
"(a)The
urgent application brought by the applicant in respect of Part A of
the notice of motion dated 6 June 2013 is dismissed
with costs.
(b)
The costs are to be costs on a party and party scale."
2.
The parties were informed that my reasons would follow and these are
my reasons.
3.
In Part A the applicant sought the following:
"1.1
An interdict be granted against the first respondent from continuing
with ordering, placing any new order, receiving any
goods as a result
of any order so placed or paying for any order placed on the fifth
respondent pursuant to any appointment to
supply 240 I grey refuse
bins, pending the finalisation of Part B of this application;
1.2
First to fourth respondents are ordered to pay the costs of this
application on a scale as between attorney and own-client,
jointly
and severally, the one paying the other to be absolved."
4.
This matter was heard on an urgent basis as the procurement procedure
that the applicant complained of would be finalised on
30 June 2013.
5.
The applicant was awarded tender CB328/2011 to supply and deliver,
"as and when" required, 240 I grey refuse bins.
They were
appointed on 24 May 2012 and the said appointment would end in 2015.
However on 12 September 2012 the first respondent
advertised a tender
for the supply and distribution of 240 I refuse bins under tender
CB214/2012. This involved the roll out of
new 240 I refuse bins in
the previously disadvantaged areas by replacing the old 85 I refuse
bins.
6.
There had been some attempt, on 18 December 2012, by the applicant to
interdict the evaluation, adjudication and award process
of tender
CB214/2012. That urgent application was dismissed with costs on 22
April 2013. The reason for the dismissal in short
was that the
applicant had failed to prove that it had a real right or any right
for that matter, not even a prime facie right,
to seek an interdict
since the tender that the applicant had been awarded differed from
the tender advertised. The difference was
that the new tender did not
encompass the same goods and services sought to be delivered.
7.
Incidentally, that specific tender which the applicant seeks to be
interdicted was cancelled. On 28 May 2013 the first respondent
appointed MPact Plastic Containers, a service provider from the
George District Municipality(under tender FIN 005/2012), to supply
65
000 240 I Waste bins at R397,60 per bin exclusive of VAT, for the
period 1 September 2013 until 31 August 2014. This tender
was due to
be accessed up until 30 June 2013.
8.
Adv Snyman, for the applicant, argued that the first respondent had
failed to comply with its own procurement policy in terms
of section
2(l)(b)(i) of the Preferential Procurement Framework Act 2000 which
reads as follows:
"FRAMEWORK
FRO IMPLEMENTATION OF PREFERENTIAL PROCUREMENT POLICY
2.(l)(b)(i)
An organ of state must determine its preferential procurement policy
and implement it within the following framework:
(a)
...
(b)
(i) for contracts with the a Rand value above a prescribed amount a
maximum of 10 points may be allocated for specific goals
as
contemplated in paragraph (d) provided that
the
lowest acceptable tender scores 90 points for the price:"
9.
Adv Snyman further submitted that Mpact Plastic Containers would
gain in excess of the prescribed R1 million because the amount
of the
tender awarded to Mpact Plastic Containers, exclusive of VAT,
amounted to R24 844,000.00.
10.
It was further argued, that in addition to the above, there was a
deviation from the procedure set out in Regulation 32 of
the Supply
Chain Management Regulation of the Municipal Finance Management Act
("MFMA"), in that the municipal officials
failed to advice
of the reason why the first respondent had deviated from the
procedure prescribed. The first respondnet did not
even specify that
it could be demonstrated that it was to the advantage of the
municipality or that there was an urgent need for
the aforesaid
procurement, as is required by Regulation 32.
11.
Lastly, the applicant submits that it has a clear right alternatively
a prime facie right, and as such it is entitled to the
relief sought.
12.
Adv Mnyandu, on behalf of the first respondent, argued that the
first respondent had a contract with the applicant and in terms
of
that contract "as and when" the first respondent required
the
goods
sought from the applicant, it would call upon the applicant to supply
same.
13.
The new contract proposed with Mpact Plastic Containers did not in
any way whatsoever encroach upon the rights of the applicant
as
envisaged by the contract between the applicant and the first
respondent.
14.
Adv Mnyandu argued further, that in terms of Regulations 32 of the
MFMA, the first respondent was empowered to procure goods
or services
under a contract secured by another organ of state, subject to the
guidelines set out in Regulation 32(l)(a),(b),(c)
and (d). Thus the
first respondent had complied with Regulation 32 in that Mpact
Plastic Containers was a supplier who was already
on the data base of
the George Municipality.
15.
For easy reference I set out Regulation 32 (1) (a) to (d):
"Unauthorized, irregular or fruitless and wasteful expenditure
32. (1) Without limiting liability in terms of the common law or
other legislation-
(a)
a political office-bearer of a municipality is liable for
unauthorized expenditure if that office-bearer knowingly or after
having been advised by the accounting officer of the municipality
that the expenditure is likely to result in unauthorized expenditure,
instructed an official of the municipality to incur expenditure;
(b)
the accounting officer is liable for unauthorized expenditure
deliberately or negligently incurred by the accounting officer
subject to subsection (3);
(c)
any political office-bearer or official of a municipality who
deliberately or negligently committed, made or authorized an
irregular expenditure is liable for that expenditure;
(d)
for that or any political office-bearer or official of a municipality
who deliberately or negligently made or authorized a fruitless
and
wasteful expenditure
is
liable for that expenditure."
16.
The applicant is still contracted to the first respondent and under
this contract "as and when" the first respondent
would
require goods to be supplied, it would naturally look to the
applicant.
17.
This does not preclude the first respondent from sourcing the goods
required from other municipalities, as long as the first
respondent
adheres to the guidelines set out in Regulation 32. It is further
evident that the employment of Mpact Plastic Containers
from the
George Municipal District does not impact on the applicants contract
with the first respondent.
18.
In my opinion the applicant concern is that it is not the only
supplier and by the looks of things not the cheaper supplier.
It is
evident that the first respondent acted in the best interest of the
municipality when it sought the services provided for
by the
applicant from the George Municipal District. Ti is relevant to point
out that there is no exclusive contract between the
first respondent
and the applicant. "As and when" it required the goods from
the applicant, the first respondent would
seek these from the
applicant, so was the nature of their contract.
19.
In my view the applicant therefore does not have a real right and or
even a prime facie right to seek the relief that it seeks
and as such
this application was dismissed with costs following the event.
W. Hughes
Judge
of the High Court
Order
made on: 14 June 2013
Reasons
delivered on: 3 July 2013
Heard
on: 14 June 2013
Attorney
for the Applicant:
ALBERT
HIBBERT ATT
Office
105 Schindler House 459 Leyds Street Pretoria
Tel:
012 343 0401/2
Ref:
A HIBBERT/TP/C36
Attorney
for the Defendant: Hugo & Ngwenya Inc
Zimbali
Chambers The Greens Office Park Charles de Gaulle Crescent Highveld,
Centurion Tell: 012 665 2997
Ref:
Mr Hugo/MP/TS457