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[2013] ZAGPPHC 199
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Tasima (Pty) Ltd v Department of Transport and Others (44095/2012) [2013] ZAGPPHC 199 (15 July 2013)
REPORTABLE
IN
THE HIGH COURT OF SOUTH AFRICA
(NORTH GAUTENG, JOHANNESBURG)
Case No: 44095/2012
DATE:17/07/2013
In
the matter between:
TASIMA
(PTY)
LIMITED
................................................................................................
Applicant
and
THE
DEPARTMENT OF
TRANSPORT
........................................................
First
Respondent
THE
DIRECTOR GENERAL: DEPARTMENT
OF
TRANSPORT.
......................................................................................
Second
Respondent
THE
MINISTER OF
TRANSPORT
…...........................................................
Third
Respondent
WERNER
EDUARD
KOEKEMOER
........................................................
Fourth Respondent
And
ROAD
TRAFFIC MANAGEMENT CORPORATION
(APPLICATION
TO
INTERVENE)
….............................................................
Fifth
Respondent
CORAM
EBERSOHN AJ HEARD ON
JUDGMENT HANDED
DOWN
ON 15 JULY 2013
JUDGMENT
EBERSOHN
AJ
[1]This
is the fourth contempt application which Tasima (Pty) Ltd (“Tasima”)
has brought since July 2012 in order to
enforce compliance with
various court orders granted in its favour by this Court against the
Department of Transport and others.
This court accepts that it is
urgent by virtue of the fact that it is a contempt application and in
addition, there are various
other facts and circumstances which
render this application particularly urgent. The Court deals
therewith infra.
[2]
Tasima currently operates, manages and maintains the eNaTIS system, a
vehicle registration system, under the Turnkey Agreement
for the
provision of the eNaTIS system (Contract RT1194KA) (“the
Agreement”) between Tasima and the Department of Transport
(“the DoT”). The eNaTIS system has been declared a
national key point under the National Key Points Act, 1980, and
its
continued operation is a matter of national importance. The eNaTIS
system allows the DoT to administer, inter alia, the licensing
of all
motor vehicles, driver’s tests, learner licence tests,
contraventions of road traffic legislation and the roadworthiness
of
vehicles. It also acts as the interface among the DoT, all licensing
institutions and municipalities, the public and a variety
of
institutional users ( including the South African Police, motor
manufacturers and banks). It represents the realisation of the
requirements under the
National Road Traffic Act, 1996
to record,
administer and maintain a variety of information and perform
functions pertaining to road traffic in South Africa.
[3]
A dispute has arisen in relation to the duration and current status
of the Agreement, and in July 2012 Tasima launched an application
out
of this Court, against the DoT, the Director General of the DoT (“the
DG”) and the Minister of Transport, for urgent,
interim
interdictory and declaratory relief to compel the DoT and the DG to
comply with the terms of the Agreement, pending the
outcome of the
dispute resolution process envisaged under the Agreement. This
application is referred to as "the Main Application"
The
Main Application was heard on 17 October 2012 when the court (Mabuse
J) granted an order in favour of Tasima which is attached
to the
Notice of Application as “NOM 1” (“the Mabuse
Order”). The Mabuse Order provided that, pending the
finalisation of the dispute resolution proceedings instituted by
Tasima in terms of the Agreement:
“
[the
DoT] is hereby directed:
1.1
To perform its obligations in terms of [the Agreement].
1.2
Without limiting the generality of 1.1 supra, to comply with the
payment obligations as defined in paragraph 17 of [Tasima’s]
founding affidavit.”
[4]
Tasima has commenced arbitration proceedings and (despite challenge)
the Mabuse Order has been effective from 6 December 2012
and is
currently in force. An application for leave to appeal was refused by
the Court and the petition for leave to appeal was
also refused by
the Supreme Court of Appeal.
[5]
Tasima, in the light of the rather obstructive and apparently
malicious conduct on the part of some of the respondents, has
been
compelled to launch the several contempt applications referred to
above against the respondents in order to enforce its rights
under
the Mabuse Order and other orders that were granted by this Court. It
is necessary to deal with and to set out the terms
of these orders
and the history of these contempt applications in order to provide
context to this latest contempt application.
Prior to the hearing of
the Main Application Teffo J handed down an order that was granted by
consent on 7 August 2012 (“the
Teffo Order”). The Teffo
Order required the DoT to do all things and take all steps as were
necessary, in accordance with
the procedures previously applied by
Tasima and the DoT, to enable Tasima to render the services and incur
the obligations required
under the agreement. Under that Order, the
DoT was also obliged to pay Tasima for all the services rendered or
to be rendered or
obligations incurred or to be incurred by Tasima in
connection with the eNaTIS system. The Teffo Order operated pending
the final
determination of the main application.
5.1
However, the DoT and the DG failed to comply with the terms of the
Teffo Order and Tasima launched a contempt application on
3 September
2012 (“the September 2012 application”). The September
2012 application culminated in a hearing before
the Full Court of
this Honourable Court. On 26 February 2013, the Full Court granted an
order compelling the DoT and the DG to
comply with the terms of the
Teffo Order.
5.2
Over the period September 2012 to March 2013 the DoT and the DG again
failed to comply with the terms of the Teffo Order and
the Mabuse
Order and Tasima launched a second contempt application on 7 March
2013 (“the March 2013 Application”).
As a result of this,
on 26 March 2013 Strijdom AJ handed down an order (“the
Strijdom Order”) which was granted by
consent between the
parties, after a capitulation by the DoT, the DG and Werner Koekemoer
(“Koekemoer”). The Strijdom
Order is attached to the
Notice of Application as “NOM 2” p 8-10. The relevant
parts of the Strijdom Order provide
as follows:
“
3.
That pending the finalisation of the dispute resolution proceedings
... [the DoT, the DG and Koekemoer] are interdicted from
taking any
steps (including entering into any contracts with third parties,
either in [the DoT’s] own name or through the
eNaTIS trading
entity), which have the effect of rerouting or diverting any of the
Work (as defined in paragraph 15.3 of the supporting
affidavit) from
the applicant;
4.
That [the DoT, the DG and Koekemoer] are ordered to take all steps
necessary to convene, forthwith, the eNaTIS governance structures,
contemplated in schedule 11 of the agreement (as defined in the
supporting affidavit), including the National Steering Committee,
the
eNaTIS User Group in respect of each province and meetings with
provinces in respect of the eNaTIS system in the manner in
which such
governance structures were previously operated in [the DoT’s]
and [Tasima’s] implementation of such agreement.”
5.3
However, the Respondents defaulted once again and on 8 April 2013,
Tasima was again compelled to launch contempt proceedings
for the
third time (“the April 2013 application”) to enforce the
grant of outstanding authorisations under the Agreement
and the
various orders granted by this Court. Again faced with a contempt
application, the DoT, the DG and Koekemoer subsequently
granted all
the authorisations which were the subject matter of the April 2013
application and agreed to bear the costs of such
application.
[6]
Against this background, Tasima was once more, forced to bring urgent
proceedings against the DoT, the DG and Koekemoer (“the
Respondents”) in this, the fourth contempt application, in
order to enforce its rights under the Agreement and the Mabuse
and
Strijdom Orders.
THE CURRENT APPLICATION AND RELIEF
SOUGHT
[7]
From the facts set out in this judgment infra, the relief sought by
Tasima in the present application is designed to address
various
defaults by the DoT, the DG and Koekemoer. In particular, the
Respondents have:
7.1
withheld payment of approximately R118 million due and payable to
Tasima under the Agreement;
7.2
failed to grant various outstanding authorisations ("the
Outstanding Authorisations") in respect of Tasima's purchase
requisitions ("PRQs"), where such or substantively similar
authorisations have always been approved in the past and are
required
to be approved under the Agreement and the Orders in order to keep
the eNaTIS system operational (copies of all the relevant
PRQs and a
schedule setting out all the Outstanding Authorisations are annexed
to the founding affidavit marked “FM8”;
7.3
refused to appoint a, or confirm the identity of the current,
Program/Project Manager under the Agreement. This issue arose
because
in early May 2013 the DoT gave notice to Tasima opaquely stating that
Koekemoer (who has been the project manager from
the outset) was not
to be allowed onto the eNaTIS premises henceforth despite him being
the contact person between the Applicant
and the DoT;
7.4
refused to authorise the conclusion of contracts necessary for Tasima
to fulfil its operational mandate under the Agreement
and for the
functioning of the eNaTIS system;
7.5
failed to take any steps to convene eNaTIS governance structures
under the Agreement;
7.6
Sought (in breach of the Agreement and the Mabuse Order) to effect a
"transfer" of the "administration"
of the eNaTIS
system to the Road Traffic Management Corporation ("the RTMC")
which entity is described more fully below.
7.7
An application to intervene in this matter was even brought by RTMC
who for practical purposes has been referred to as Fifth
Respondent
in
these
proceedings. The counsel of the Fifth Respondent was allowed to
address the court and judgment whether the intervention would
be
allowed was reserved.
THE OPPOSITION TO THIS APPLICATION
[8]
Two separate answering affidavits have been filed in this matter.
[9]
The one was deposed to by Koekemoer, who allegedly deposes to the
affidavit on behalf of himself and the DG. No explanation
was
forthcoming as to why the DG himself/herself did not depose to an
answering affidavit. Koekemoer fails to state that he is
authorised
to act on behalf of the DG and there is no proof of any such
authority anywhere in the papers. The allegation of authority
is
remarkable given Koekemoer’s sudden removal from the eNaTIS
project and is disbelieved. In the answering affidavit Koekemoer
attempts to explain the various defaults set out more fully below.
The Court will deal with his explanations where the Court deals
with
the detail of the defaults below. For practical purposes this Court
will deal with the contents of Koekemoer’s affidavit
for what
it may be worth.
[10]
In addition it appears from the Koekemoer answering affidavit that on
6 May 2013 the Minister directed that the eNaTIS system
be managed by
RTMC on behalf of the DoT. No proof of this “major occurrence”
is attached and it is startling to note
that the Minister himself did
not see his way open to take this Court into his confidence and file
an answering affidavit. The
RTMC is an independent juristic entity in
terms of section 3 of the Road Traffic Management Act, 1999. In light
of this the Respondents
allege that “the eNaTIS system is
currently being managed by the RTMC on behalf of the DoT\ For this
reason RTMC seeks to
be joined as a party to the present application.
RTMC has also delivered an answering affidavit on its own behalf,
deposed to by
its acting COO. Remarkably, the DoT has chosen to
remain silent, electing not to file an answering affidavit, despite
the fact
that the DoT and the DG (as its accounting officer) bear the
obligations of complying with the Agreement and the Orders and
potentially
face committals for contempt. By their silence they have
not eased the burden of the Court but they will merely have to suffer
the consequences of their remaining silent.
[11]
Koekemoer’s explanations for the defaults are, broadly
speaking, as follows -
11.1
Prior to 6 May 2013, Koekemoer was the Project Manager in the DoT
responsible for the management of the eNaTIS system on behalf
of the
DoT. However, when the management of the eNaTIS system was
transferred to RTMC on 6 May 2013 he ceased to be the Project
Manager
and to have any responsibility on behalf of the DoT.
11.2
The management of the eNaTIS system according to him now vests in the
RTMC, thus exculpating the DoT and Koekemoer of responsibility
for
any defaults under the Court orders, so they apparently think.
11.3
The Respondents were, at all times, acting on legal advice and their
conduct cannot constitute contempt as it was not mala
fide. This
appears to be a mirror of the history of the appeal between the
parties in matter A862/12 in which Tuchten J handed
down the judgment
on the 25th February 2013 and wherein the full Court condemned in
very strong language the conduct of the same
respondents. For the
respondents to aver that their deliberate failure to comply with a
specific and direct court order can, by
merely listening to legal
advice, excuse them and their failure to comply with the court order
no longer constitutes contemp of
court, is just not on.
[12]
None of these explanations provide an adequate answer to Tasima’s
application. The alleged transfer of the management
of the eNaTIS
system to RTMC is a material breach of the Agreement and the Mabuse
Order and is unlaful. Even if the DoT was entitled
to transfer the
management of the eNaTIS system to RTMC (which at this stage is not
proven yet) and RTMC would manage it “o«
behalf of the
DoT\ the Agreement and the Mabuse and Strijdom Orders still bind the
contracting parties and the parties referred
to in the various
Orders. It is not possible for the DoT and the DG to escape their
obligations under the Agreement and the Orders
by simply transferring
their obligations to a third party without the knowledge or consent
of Tasima or the sanction of the Court,
and thereby “wash their
hands” of their obligations under the Court Orders. In any
event, any breach of an order by
the agent of the DG or the DoT
(namely RTMC) must be regarded as a breach of the order by the
principal. This is borne out by the
statements made by Koekemoer in
his answering affidavit and by RTMC in their joinder application:
12.1
In Koekemoer’s paragraph 7.2 of his answering affidavit he
states that the DoT has not transferred to the RTMC any court-ordered
obligations (even if it could). In a supporting affidavit to
Koekemoer’s answering affidavit, Me Fakira also states
unequivocally
that the DoT has not transferred to the RTMC any of its
obligations under the Agreement;
12.2
In the RTMC joinder application RTMC states that the RTMC is the
program manager, alternatively an agent of the DoT. In RTMC’s
answering affidavit, RTMC states that “[RTMC] is now appointed
as the Project Manager on behalf of [the DoT] with Adv Gerber
as the
contact person ... [RTMC] is only appointed to act as an agent of
[the DoT] and nothing more'';
12.3
In either event the DoT and the DG remain liable under the Agreement
and the Court orders. They cannot by their latest ruse
evade such
obligations.
[13]
Furthermore, legal advice cannot change the facts and the contractual
position and the Respondents’ reliance on legal
advice as a
ground of opposition to the contempt application, is without merit.
The terms of the Agreement are clear. The Respondents
and their legal
advisers have sought to rely on terms of the Agreement which are
plainly inapplicable and have never been relied
upon before. Tasima
has pertinently pointed out to the Respondents and their legal
advisors, in writing, that these provisions
are inapplicable and the
Respondents and their legal advisors have failed to respond to these
assertions. It is submitted that
if the Respondents received legal
advice to the effect that they are not in default this advice was so
obviously wrong that reliance
thereon cannot be bona fide.
[14]
Both Schedule 7 of the Agreement and the EPP are expressly referred
to as the “payment obligations” in paragraph
1.2 of the
Mabuse Order. Paragraph 1.2 of the Mabuse Order refers to “the
payment obligations as defined in paragraph 17
of [Tasima’s]
founding affidavit.” Paragraph 17 of Tasima’s founding
affidavit in the Main Application is “FM
14” to the
Founding Affidavit (pp 180 - 181), and it makes express reference to
Schedule 7 of the Agreement and the EPP.
[15]
Each of the categories of defaults, which are set out in detail in
the founding affidavit must now be dealt with by the Court,
and the
Court will then deal with the explanations for their breach proffered
by Koekemoer and RTMC in their answering affidavits.
THE PRQs & OUSTANDING
AUTHORISATIONS - A BREACH OF THE MABUSE ORDER
[16]
The operational logistics of the eNaTIS system entail Tasima
generating monthly “purchase requisitions”, also referred
to as “PRQs”, which reflect expenditure to be incurred
which is necessary for the ongoing maintenance and operation
of the
eNaTIS system, and which are then approved by the DoT. On the basis
of the DoT’s approval of the underlying PRQ, Tasima
then incurs
the actual expenditure, invoices the DoT and presents a “payment
certificate” to the DoT, in accordance
with Schedule 7 of the
Agreement (which is “FM 4” to the founding affidavit) and
the Extended Period Provisions of
the Agreement (which is “FM
7” to the founding affidavit) (“the EPP”). The DoT
is then obliged to pay Tasima
the invoiced amount within 21 days.
16.1
In particular, item 4.6 of schedule 7 to the Agreement provides as
follows:
“
Terms.
Payment by the State will be within 21 (twenty one) days of
submitting an invoice and the supporting Payment Certificate
to the
State”
16.2
Paragraph 2.6 of the EPP provides as follows:
“
2.6
Payment terms
Payments
will be claimed on a monthly basis by means of the payment
certificate mechanism in accordance with Schedule 7 of [the
Agreement] for work executed during the month. This includes work on
a Time and Material basis, by means of formal agreements (such
as
maintenance), work on a recovery basis or as a result of approved
proposals, quotations or work orders.
Services
rendered to private or external parties (such as quotations accepted
by local authorities) will be invoiced directly to
the appropriate
party.
Payment
by the Department will be made within 21 (twenty one) days of Tasima
submitting a joint invoice and the supporting Payment
Certificate to
the Department.”
[17]
This procedure has always been followed by the parties. Since July
2012, however, the DoT became increasingly dilatory in complying
with
its obligations, forcing Tasima to approach this Court and issue
notice under the State Liability Act, 1957 ("the Act")
on
various occasions to obtain amounts due to it.
[18]
It is plain that (as a consequence of the dispute) the DoT has
adopted a strategy of hamstringing Tasima’s execution
of the
agreement at two distinct levels - firstly, by failing to authorise
necessary expenditure (such as in the case of the Outstanding
Authorisations), and, secondly, by authorising such expenditure and
then simply refusing to pay invoiced amounts. In particular,
the
Respondents have failed to -
18.1
make payment of approximately R118 million due and payable to Tasima
under the Payment Certificates; and
18.2
grant the Outstanding Authorisations in respect of Tasima's PRQs, as
set out in the schedule annexed to the founding affidavit
marked
"FM8" p 157 ff.
[19]
These failures constitute breaches by the Respondents of their
obligations under the Agreement and the Mabuse Order. The Court
will
deal with the facts and circumstances surrounding each of these
breaches below.
NON-PAYMENT OF PAYMENT CERTIFICATES
TASIMA’S CASE:
[20]
To date the DoT has failed to make payment in the amount of R118 502
705.13 due and payable under invoices and payment certificates
issued
by Tasima to the DoT. This amount is made up as follows, and arises
from the following payment certificates:
20.1
Payment certificate 67, which was submitted on 11 January 2013 and
which was due on 1 February 2013 (annexure “FM16”
p 188
to the founding affidavit) and in respect of which the DoT has
arbitrarily withheld R10 million;
20.2
Payment certificate 68, which was submitted on 8 February 2013 and
which was due on 1 March 2013 (annexure “FM19”
p217 to
the founding affidavit) and in respect of which the DoT has
arbitrarily withheld R10 million;
20.3
Payment certificate 69, which was submitted on 6 March 2013 and which
was due on 27 March 2013 (annexure “FM23”
p 252 to the
founding affidavit) and in respect of which the DoT has arbitrarily
withheld R10 million;
20.4
Payment certificate 70 in an amount of R47 674 144.40 (annexure
“FM30” p 303 to the founding affidavit) which was
due on
30 April 2013, and which the DoT has not paid at all; and
20.5
Payment certificate 71 in an amount of R40 829 560.73 (annexure
“FM31” p 340 to the founding affidavit) which was
due on
31 May 2013, and which the DoT has not paid at all.
[21]
Importantly, underlying PRQs in respect of these payment certificates
have already been approved by the DoT. This is acknowledged
by the
Respondents in the correspondence of the State Attorney. This is also
not denied in Koekemoer’s or RTMC’s answering
affidavits.
All that remains is for the DoT to make payment of these amounts
which they have failed to do on spurious grounds,
set out below.
[22]
A detailed chronology relating to the submission of these payment
certificates and the exchange of correspondence between Tasima
and
the DoT appears in the founding affidavit at paragraphs 43-61 at pp
26 - 32. It is not in dispute. The essential features of
this
chronology are as follows:
22.1
On 21 January 2013, after Tasima submitted payment certificate 67,
Tasima received a letter from “the eNaTIS Trading
Entity”
(which is not party to the Agreement) per Koekemoer (“FM17”
to the founding affidavit). In this letter
Koekemoer requested a
"detailed breakdown" of various costs pertaining to certain
of the items comprising payment certificate
67. Koekemoer further
stated that payment would be delayed until such information was
received. Those items which allegedly required
a detailed breakdown
related to, primarily, the 15% mark-up charged by Tasima under the
Agreement and the EPP and the labour component
of the invoice.
Tasima’s entitlement to a 15% markup is dealt with fully
in the FA para 39 - 40 pp 24 - 25.
22.2
On 13 February 2013, Tasima received a further letter from the eNaTIS
Trading
Entity” per Koekemoer (“FM18” to the founding
affidavit).
In
the letter Koekemoer stated that the DoT had previously requested
"confirmatory documentation pertaining to payment certificate
67
in order to perform certain compliance checks before full payment can
be done", and that, due to Tasima's failure to supply
such,
"only partial payment can be approved for payment certificates
67 and 68" (own emphasis). This resulted in the
DoT arbitrarily
deducting RIO million from the payments made by the DoT in respect of
each of payment certificates 67 and 68 (even
though no similar
request for documentation had been made in respect of certificate no.
68).
22.3
Importantly, the need for additional "confirmatory
documentation" and "compliance checks" constituted a
novel request, foreign to the Agreement, which the DoT now required,
for the first time in well over a decade, before payment would
be
effected, and despite the fact that the PQR’s had been
approved. In terms of Schedule 7 of the Agreement, payment is not
contingent on the provision of any additional documentation, nor is
payment reciprocal on the DoT being furnished with documentation
it
may decide (arbitrarily or otherwise) to request. Indeed, prior to 21
January 2013, since inception of the Agreement over 10
years ago,
there has only ever been one request for any additional documentation
to be provided. Such documentation (which was
of very limited scope
and related only to one individual) was provided without any
admission of obligation to do so on the part
of Tasima and, in any
event, payment of the payment certificate to which the documentation
related was not withheld pending the
provision of any documentation.
This is not in dispute.
22.4
On 25 March 2013 Tasima responded to the request for documentation
(“FM 20” to the founding affidavit). Tasima
denied that
any documentation was required under the agreement, but Tasima
nevertheless provided the DoT with all the requested
documentation,
and demanded full payment of payment certificates 67 and 68 by 2
April 2013. Tasima made a further demand for payment
on 18 April
2013
(“FM 22” to the founding affidavit). Neither was met.
22.5
On 24 April 2013 the State Attorney sent a letter to Webber Wentzel
(“FM24” to the founding affidavit). In this
letter the
State Attorney now, for the first time, and in vague and general
terms, called for “timesheets”, (it is
unclear for
precisely which periods and items the spreadsheets were requested) in
order to verify Tasima’s claims contained
in items 1.1 - 1.5 of
PC 67, 68 and 69 which underlay the “support and consulting
services”. In justification of its
request for timesheets, the
State Attorney relied on Schedule 7, clause 4.5 (annexure “FM4”)
which reads (in full)
as follows:
"Timesheets:
The Contractor shall maintain records of the hours worked by its
Staff in the provision of any Service on a Time
and Material Basis
and of the expenses incurred for which reimbursement is due in terms
of this Agreement. The State may audit
such records within 12
(twelve) months of the date of the invoice in respect thereof."
22.6
It is clear that payment is not conditional upon the provision,
approval or verification, of timesheets. Clause 4.5 simply
allows the
DoT to audit timesheets up to 12 months after submission of any
payment certificate and invoice relating thereto, and
substantially
after the expiry of the 21 calendar day period for payment of every
payment certificate rendered to the DoT.
22.7
Some further correspondence was exchanged between Webber Wentzel and
the State Attorney (annexure “FM25”, “FM26”,
“FM27” and “FM28”). In this correspondence
Webber Wentzel addressed the allegations made by the State Attorney
and repeatedly demanded payment of the outstanding amounts. In its
correspondence (“FM27”) the State Attorney simply
repeated its reliance on Schedule 7, clause
4.5
and now also raised clause 2.2.k of the EPP, (2.2.k of the EPP simply
provides, “k The Contractor shall maintain records
(time
sheets) of all hours worked in the provision of the Services.”)
and stated that it was “entitled to verify [Tasima’s]
claims in respect of the hours worked by its staff in the provision
of services'’. It suffices to say that this correspondence
did
not serve to clarify the Respondents' attitude regarding payment.
22.8
This correspondence culminated in Webber Wentzel making a final
demand on 6 June 2013 (annexure “FM 29”) (“the
6
June 2013 letter”) for payment in full by no later than 12h00
on 12 June 2013.
22.9
On 7 June 2013, Tasima received a letter from the State Attorney
(annexure "FM39" to the founding affidavit), now
suddenly
acting on behalf of the RTMC, not substantively addressing any of the
issues raised in the 6 June 2013 letter, but rather,
some two months
after the submission of payment certificate 70, and some five weeks
after payment thereunder became due (30 April
2013), requesting a
panoply of supporting documentation to allow the respondents to
"consider
payment"
of payment certificate 70. The statement in the State Attorney’s
letter to the effet that payment certificates
67 to 69 have been paid
allegedly is plainly untrue according to paragraph 93 of the founding
affidavit.
[23]
The eNaTIS system is Tasima's sole business and source of income -
nonpayment by the DoT, particularly of such a large amount
as is
currently outstanding, jeopardises Tasima's ability to continue as a
going concern and remain a viable commercial enterprise.
[24]
The Respondents’ obstructive behaviour in calling for, and
making payment conditional on the furnishing of ''confirmatory
documentation", and then changing tack and calling for
“timesheets”, where it is clear that none of the
requested
documents is required under the Agreement or the EPP, is a
clear contrivance and a clear violation of the Agreement and the
Respondents’
obligations under the Mabuse Order.
[25]
In the circumstances, so it appears, the Respondents are in breach of
the terms of the Agreement and the Mabuse Order. Notwithstanding
demand, the Respondents remain in breach, and their breach is
contemptuous.
Koekemoer’s & RTMC’s
Answer:
[26]
Koekemoer asserts that the DoT was entitled to withhold RIO million
in respect of PC67, PC68 and PC69, because Tasima had not
supplied
timesheets to verify the hours worked by its staff in the provision
of “Support and consulting services” in
items 1.1 - 1.5
under PC67, PC68 and PC69. Thus (he says) the DoT could not determine
the amount of Tasima’s claims. He then
states that the
withholding of this
amount
(R30 million) does not involve non-compliance with the Mabuse Order
because, -
26.1
the obligation to pay gives rise to a dispute under the Agreement and
in terms of clause 13.4 of the Agreement and Schedule
13, clause 2 of
the Agreement, this dispute is subject to a dispute resolution
mechanism; and
26.2
even if the withholding of these amounts did constitute
non-compliance with the Mabuse Order, such non-compliance was not
wilful or mala fide because the amounts were withheld according to
legal advice obtained.
[27]
RTMC for its part alleges that there were “delays in inter alia
checking and processing [Tasima ’s] invoices”,
RTMC
states that Koekemoer required a detailed breakdown of costs in
relation to support and consulting services because he had
received
complaints that over the December 2012 Tasima was short staffed, and
that Tasima had charged as if it had a full staff
compliment during
the December 2012 period, when in fact it did not. In the
circumstances he believed that these were “excessive
claims”.
RTMC then promptly states that “the queries raised by
[Koekemoer] are the same in respect of payment certificates
68 and
69”, even though the explanation plainly cannot apply to PC68
(or any of the others). RTMC states that it agrees with
Koekemoer’s
reasons for not paying the RIO million in respect of each of the
payment certificates 67, 68 and 69.
[28]
RTMC’s answers are clearly spurious. Firstly, there is no
evidence of a valid or bona fide dispute regarding the “Support
and consulting services” in items 1.1 - 1.5 under PC67, PC68
and PC69. As already indicated underlying PRQs in respect of
these
certificates were already signed off by the DoT. This is not disputed
in Koekemoer or RTMC’s answering affidavits. It
is not clear
why there should therefore be delays in “checking and
processing Tasima’s invoices” - the PRQs were,
no doubt,
scrutinised when they were presented and they were subsequently
approved. Indeed, RTMC itself points out that the Agreement
entitles
the Project Manager to request supporting documentation in order to
verify the PRQs. Once the PRQs are signed off they
must be processed
and paid in accordance with the terms of the Agreement. Secondly,
RTMC’s answering affidavit is the first
time that any of the
Respondents have sought to explain their queries regarding the
“support and consulting services”
component of the
relevant payment certificates. This was never explained in any of the
extensive correspondence exchanged between
the parties. Thirdly, if
there was a query regarding Tasima’s staff complement in
December
2012
and this impacted on Payment Certificate 67, why request the
timesheets in respect of all the subsequent Payment Certificates?
This is simply not explained. Fourthly, when the State Attorney
belatedly, (Importantly, the first payment certificate, PC67, was
submitted on 11 January 2013 and was due on 1 February 2013. The
insistence on timesheets was only made on 24 April 2013.)called
for
timesheets, Webber Wentzel pointed out that the Agreement does not
provide that payment is conditional on the furnishing of
timesheets,
and that these had never before been requested. The State Attorney
and Koekemoer have never meaningfully answered Webber
Wentzel’s
assertions in this regard. Neither of them has advanced a contrary
interpretation of the Agreement (which is capable
of dispute
resolution) nor have they explained why timesheets were never called
for in the past, but are now mysteriously required.
The absence of
these explanations is glaring and demonstrates that this request for
timesheets is a contrivance, and that there
is no
actual
dispute between the parties regarding payment. (See further Delfante
and another v Delta Electrical Industries Ltd and another
1992 (2) SA
221
(C) which is authority for the proposition that there must be a
“dispute” as a prerequisite for arbitration).
[29]
Koekemoer also proffers an explanation for the non-payment of PC 70
and PC 71. He states that he and the DG were not guilty
of any wilful
default because -
29.1
PC 70 was payable on 30 April 2013, but that 1 May 2013 was a public
holiday and from 6 May 2013 he was no longer the Project
Manager
responsible for the management of the eNaTIS system on behalf of the
DoT; and
29.2
PC 71 is dated 9 May 2013 after he ceased to be the Project Manager
in the DoT responsible for the management of the eNaTIS
system on
behalf of the DoT.
[30]
RTMC then alleges that PC70 was only received by RTMC (specifically
Adv Gerber) on 5 June 2013 and that he raised a number
of queries in
order to check and process the invoice, and these were communicated
in the State Attorney’s letter “FM39”
pp 447. RTMC
states that it only became aware of PC71 on 6 June 2013, when
receiving the letter of demand. Notwithstanding these
extensive
queries in FM39, RTMC now states that it will make payment of part of
PC70 (which was due on 30 April 2013) and part
of PC71 (which was due
on 31 May 2013), but that it will withhold certain amounts. RTMC
states that payment of the amounts not
disputed will be effected
within 7 working days calculated from Monday 24 June 2013.
[31]
Again, these explanations are flimsy and clearly demonstrate the
wilfulness of the DG and Koekemoer’s defaults. First.
PC70 was
payable on 30 April 2013. This means that all steps necessary to
process the payment would have had to be taken before
30 April 2013.
Secondly, 1 May 2013 (the public holiday) was a Wednesday, and even
if Koekemoer was reassigned on 6 May 2013, he
took no action to
effect payment on 2nd or 3rd of May 2013, both of which were working
days. Thirdly, although Koekemoer states
that he was no longer the
Project manager from 6 May 2013, RTMC’s answering affidavit
makes it clear that as late as 8 May
2013 he had a meeting with RTMC
(now ostensibly the new Project Manager) and “the purpose of
this meeting was for [Koekemoer]
to liaise and work with [RTMC] to
ensure the smooth take-over of the Project Management duties by
[RTMC]”. This contact gave
Koekemoer ample opportunity to
ensure compliance with the terms of the Orders. Fourthly, the fact
that Koekemoer was reassigned
is irrelevant. The payment obligations
of the DoT rest with the DG who is the “accounting officer”
in terms of section
36 of the Public Finance Management Act, 1999
(“the PFMA”). Koekemoer’s “reassignment”
cannot affect
the obligations of the DoT or the DG under the PFMA,
the Agreement or the Court Orders. Fifthly, there is no explanation
as to
why RTMC only received PC70 on 5 June 2013 when it was payable
on 30 April 2013 and PC71 on 6 June 2013, when it was payable on
31
May 2013. This clearly demonstrates the laxity with which the
Respondents view the Agreement and the Orders of this Court.
[32]
Most baffling, RTMC now states that it will recommend to the DoT to
conduct a “full forensic audit of all payments made
to [Tasima]
in terms of this agreement for at least the past 12 months, as there
are serious concerns by the respondents that all
payments claimed and
made were not due and payable in terms of the agreement”.
Interestingly, Koekemoer, who has always been
the Project Manager
never saw fit to call for a “full forensic audit”, and it
is unclear why and on what basis RTMC
now seeks to do so. The only
reasonable explanation is to continue to harass Tasima and thereby
make its continued operation of
the eNaTIS system impossible so as to
force a “divorce” between die DoT and Tasima and the
Court got the clear impression
that the Respondents were maliciously
implementing steps to cause Tasima to financially crash so as to get
rid of Tasima and then
employ somebody else. The proposed full
forensic audit can conveniently be conducted later but cannot be used
as an interim excuse
to avoid payment strictly on time. There is no
merit in the excuses of the respondents and they must pay or go to
prison.
THE OUTSTANDING AUTHORISATIONS
Tasima’s Case:
[33]
Since May 2013 the DoT has failed to approve or even collect over 140
PRQs and provide the necessary approvals in respect of
the
Outstanding Authorisations. All of the Outstanding Authorisations
(contained in “FM8” to the founding affidavit)
are
necessary for Tasima to incur expenditure under the Agreement, and
are essential to the operation and maintenance of the eNaTIS
system.
All of the Outstanding Authorisations are substantively similar to
authorisations which have always been approved in the
past. As
already stated, the Respondents are obliged to approve the PRQs under
the Agreement and the Mabuse Order.
[34]
In the past Koekemoer collected PRQs from Tasima's premises or
attended at Tasima's premises to review such PRQs. From 6 May
2013,
however, this practice abruptly ceased, with the DoT failing to
collect, or even accept delivery of, any PRQs. When Koekemoer
failed
to collect the PRQs or attend at Tasima’s premises to review
the PRQs, Tasima repeatedly tried to effect delivery
of the PRQs to
the DoT’s premises in May 2013, but the DoT refused to accept
the deliveries. Specifically on 28 May 2013,
Tasima's Ms N Ndebele
attempted to deliver the PRQs to the DoT offices at the Forum
Building, 159 Struben Street, Pretoria. However,
the DoT's officials
refused to accept delivery of the PRQs, with Koekemoer informing Ms
Ndebele that she was to return to Tasima
with them.
[35]
According to the statement this has forced Tasima into an
intolerable situation. It is obliged either not to incur necessary
expenditure, which jeopardises the eNaTIS system and Tasima’s
business, or to proceed to incur expenses on risk simply to
salvage
its business and maintain the sanctity of the eNaTIS system.
[36]
Tasima drew the DoT’s attention to this failure to accept and
approve the PRQs and demanded that it be rectified, in
writing on at
least 2 occasions, namely -
36.1
by means of a letter dated 30 May 2013, addressed by Tasima’s
attorneys, Webber Wentzel, to the State Attorney, which
is “FM
28” to the founding affidavit (“the 30 May 2013 letter”);
and
36.2
by means of a letter dated 6 June 2013, addressed by Webber Wentzel
to the State attorney, which is “FM29” to the
founding
affidavit (“the 6 June 2013 letter”).
Koekemoer ‘s & RTMC’s
Answer:
[37]
Koekemoer offers the following explanations (on his own behalf and on
behalf of the DG although it is not clear where he got
the authority
from to speak on behalf of the DG and his own explanation is in any
case irrelevant as he was a mere employee of
the DoT and was
apparently dismissed) for these defaults:
37.1
First, he repeats that since 6 May 2013 the eNaTIS system has not
been managed by him on behalf of the DoT, but by the RTMC;
and
37.2
Secondly, in relation to Ms Ndebele’s visit on 28 May 2013,
Koekemoer states, that when he was told by Ms Ndebele’s
Personal Assistant that Ms Ndebele was at the premises he told Ms
Ndebele’s Personal Assistant that, he was no longer the
Project
Manager in the DoT, and that Ms Ndebele should not deliver the PRQs
pending her receiving further instructions regarding
the delivery
thereof. Koekemoer AA para 5.5. Koekemoer also states that on 14 May
2013 the DoT sent a letter to Tasima (“FM
33” to the
founding affidavit) to no longer allow Koekemoer to enter the eNaTIS
premises. (Koekemoer AA para 5.4). But clearly
this explanation is an
add-on. The real reason why Koekemoer no longer wanted anything to do
with the Outstanding Authorisations
is because he allegedly had been
removed as the Project Manager on 6 May 2013.
[38]
These explanations do not assist the DoT, the DG or Koekemoer. First,
as already stated , the fact that Koekemoer was reassigned
is
irrelevant. The payment obligations of the DoT rest with the DG who
is the “accounting officer” in terms of section
36 of the
Public Finance Management Act, 1999 (“the PFMA”).
Koekemoer’s “reassignment” cannot affect
the
obligations of the DoT or the DG under the PFMA, the Agreement or the
Court Orders. Secondly, notwithstanding Tasima’s
repeated
requests, at no stage did the DoT, the DG or Koekemoer advise Tasima
who was responsible after 6 May 2013 for signing
off the Outstanding
Authorisations. This strengthens the suspicion that they want Tasima
to financially crash so as to get rid
of Tasima so that somebody,
perhaps already identified by somebody, could be appointed. The role
of the Road Traffic Management
Corporation, who applied for leave to
intervene is most suspicious, and seems to be the tool to draw the
flak away from the other
Respondents and to stall the performance of
the Government under the contract with Tasima.
[39]
RTMC gives no answer to the failure to receive or process the
Outstanding Authorisations. RTMC simply refers to the supporting
documentation that accompanies the Outstanding Authorisations and
states that it will need supporting documents before it can authorise
the Outstanding Authorisations, and since these supporting documents
are voluminous, “it is unfair to expect [RTMC] to be
in a
position to authorise this within 1 day” as requested in the
Notice of Application. RTMC states that it will require
at least 1
week to go through the supporting documents.
[40]
RTMC’s explanations are again, a contrivance and miss the
point. The point is that the DoT has never even attempted to
collect
these Outstanding Authorisations and the DoT and Koekemoer refused to
take delivery of them. They cannot now complain of
the lack of time.
Secondly, all the supporting documentation is available for
inspection. This documentation is even offered by
Tsima in FA para
16.2 record p. 16.Had the DoT, the DG and Koekemoer acted in
accordance with the Agreement and the Orders, as
they did in the past
without raising the supercilious excuses they now have, they would
long since have had these Outstanding Authorisations
and the
supporting documentation in their possession for timeous
consideration and approval.
[41]
In the circumstances, the Respondents excuses are spurious and they
are in clear breach of the terms of the Agreement and the
Mabuse
Order. The Court will make an appropriate order to curb future
similar ploys on the part of the Respondents.
Respondents’
Other Defaults - Breach of Mabuse & Strijdom Orders
[42]
Paragraph 1.1 of the Mabuse Order requires Tasima “[t]o perform
its obligations in terms of the agreement”. In
addition
paragraphs 3 and 4 of the Strijdom Order provide that -
42.1
the DoT, the DG and Koekemoer are required to convene, forthwith, the
eNaTIS governance structures contemplated in schedule
11 to the
Agreement, in the manner in which such governance structures were
previously operated in the DoT’s and Tasima’s
implementation of the Agreement (see paragraph 4).
42.2
pending the finalisation of the arbitration proceedings the DoT, the
DG and Koekemoer are interdicted from taking any steps
(including
entering into any contracts with third parties, either in the DoT’s
own name or through the eNaTIS trading entity),
which have the effect
of rerouting or diverting any of “the Work” (as defined
in paragraph 15.3 of the supporting affidavit
in that application)
from Tasima (see paragraph 3). The term “the Work” (as
defined in paragraph 15.3 of the supporting
affidavit in that
application) refers to "services which Tasima had hitherto
undertaken and performed or currently undertakes
and performs under
the agreement (including work in relation to provinces) (all the
services which Tasima undertakes and performs
or had hitherto
undertaken and performed under the agreement are defined as "the
Work"). See FA para 79 p 37.
[43]
The Respondents -
43.1
have failed to appoint a, or confirm the identity of the current,
Program/Project Manager under the Agreement, who is an essential
part
of the governance structures under the Agreement;
43.2
have failed to take any steps to convene the other eNaTIS governance
structures under the Agreement;
43.3
instead sought to effect a "transfer" of the
"administration" of the eNaTIS system to the Road Traffic
Management Corporation ("the RTMC") which entity is
described more fully below;
43.4
refused to authorise the conclusion of contracts necessary for Tasima
to fulfil its operational mandate under the Agreement
and for the
functioning of the eNaTIS system;
43.5
The heads of argument filed on behalf of the First, Second and Fourth
Respondents states in paragraphs 6.2 and 6.3, relying
as authority on
paragraphs 8.1 and 8.2 of the Fifth Respondent’s answering
affidavit, (which paragraphs is no authority for
nor do they even
refer to it) argue that the provincial Departments of Transport
(which counsel alleges are part of the governance
structures) have
refused that the governance structures set out in paragraph 4 of the
Strijdom Order be convened, by way of adopting
the stance that the
continuation of the agreement is unlawful. No proof of such an
alleged refusal is produced and it is not clear
where counsel got
this information from. In any case, that is the problem on the
Respondents.
[44]
What is stated in paragraph [43] supra constitute breaches by the
Respondents of their obligations under the Agreement, the
Mabuse
Order and the Strijdom Order. The Court will deal therewith again
infra.
FAILURE
TO IDENTIFY THE PROJECT/PROGRAMME MANAGER Tasima’s Case:
[45]
In terms of the Agreement, the DoT and Tasima are each obliged to
appoint a "Program Manager", also referred to as
the
"Project Manager", who, in terms of clause 16 of the
Agreement, is responsible for "Contract governance",
as
provided for in Schedule 11 of the Agreement. In practical terms,
"contract governance", from the DoT's perspective,
included
approval of Tasima's PRQs, ensuring payment of eNaTIS expenditure,
meeting with Tasima to discuss matters pertaining to
the
implementation of the Agreement, convening governance structures
under the Agreement and acting as a general point of contact
between
Tasima and the DoT and to ensure the smooth running of the contract
in the National interest.
[46]
On 14 May 2013 Tasima received an email from the Director: Security
Services of DoT (a copy of which is "FM33" to
the founding
affidavit), headed "DENIAL OF ACCESS - WERNER KOEKEMOER".
The email directed Tasima to "suspend the
access of and further
prevent [Mr Koekemoer] from accessing the building or any part
thereof" Thereafter, Mr Koekemoer played
no further role under
the Agreement, but Tasima has not received any official notice of his
removal as a Project/Program Manager
or revoking his authority as an
authorised representative of the DoT or notice of who his replacement
is.
[47]
Tasima has requested the DoT and the DG to clarify who in the DoT is
now responsible for the fulfilment of the obligations
of the “Project
Manager” in writing on at least 3 occasions, namely -
47.1
by means of a letter dated 16 May 2013, addressed by Tasima’s
attorneys, Webber Wentzel, to the State Attorney, which
is “FM
32” to the founding affidavit (“the 16 May 2013 letter”);
47.2
in the 30 May 2013 letter - “FM 28” to the founding
affidavit; and
47.3
in the 6 June 2013 letter - “FM29” to the founding
affidavit.
[48]
To date, the DoT has ignored these demands and failed to appoint, or
notify Tasima of the appointment of a Project/Program
Manager to
"facilitate the smooth and effective management of the
relationship", as envisaged under clause 16 and schedule
11 of
the Agreement.
Koekemoer’s & RTMC’s
Answer:
[49]
Koekemoer’s only explanation of this default is that he was
removed on 6 May 2013. On 6 June 2013, the State Attorney
sent a
letter to Webber Wentzel (“FM34” to the founding
affidavit) in which the State Attorney advised that: (1) the
administration of the eNaTIS system on behalf of the DoT has been
transferred to the RTMC; (2) Adv Mome Gerber is the contact person
within the RTMC; and (3) all administration matters concerning the
eNaTIS system were to be referred to Advocate Gerber. Therefore,
Tasima was indeed informed that the RTMC was responsible for the
management of the eNaTIS system on behalf of the DoT. RTMC’s
answer is similar and relies on “RRM 1” to RTMC’s
answering affidavit.
[50]
Tasima, as could be expected from it, fearing a collapse of the Natis
system, had pertinently requested details of the programme
manager,
in writing on 3 occasions from 16 May 2013. It was only on 6 June
2013, that the State Attorney wrote the letter which
is “FM 34”
(pp 370 - 371). That letter simply states that “the
administration of the eNatis has now been transferred
to [the RTMC7”.
It was by no means clear, from that letter, that the DoT and the DG
were intending to convey that RTMC was
now the “Project
Manager”. Importantly, Tasima requested clarity in “FM
35” which was sent immediately
after “FM 34”.
However the DoT failed to provide any clarity on this issue. If it
was the DoT’s intention simply
to appoint a new project manager
this should have been clearly stated. Clearly, the implications of
“FM 34” were more
extensive than simply appointing a new
Project Manager, and “RRM 1” was never been placed before
Tasima. It was unclear
what had been “transferred”. The
confusion is explained fully in Tasima’s Replying Affidavit to
Koekemoer’s
answering affidavit. In the circumstances, Tasima
was accordingly fully justified in seeking the relief which it seeks
in this
present application.
PROPOSED TRANSFER TO RTMC Tasima’s
Case:
[51]
On 6 June 2013 Tasima's attorneys, Webber Wentzel, received a letter
from the State Attorney, which is “FM 34”
to the founding
affidavit. In this letter the State Attorney stated that the
''administration of the eNatis has now been transferred
to the Road
Traffic Management Corporation and Advocate Morne Gerber is the
contact person”. The reference to “administration”
of the eNaTIS system is unclear. The system has at all relevant times
been operated, maintained and managed (which necessarily
includes
administration) by Tasima under the Agreement.
[52]
The Road Traffic Management Corporation (“RTMC”) is an
independent juristic entity separate from the DoT, as provided
for
under section 3 of the Road Traffic Management Act, 1999. As appears
from the founding affidavit in the Main Application RTMC
is the
entity within the State which was intended eventually by the DoT to
take transfer and custody of the eNaTIS system once
the Agreement had
terminated.
[53]
As appears from the State Attorney’s letter of 6 June 2013,
the DoT now seeks unlawfully to accelerate the transfer
it once
envisaged by rerouting the administration of the eNaTIS system to the
RTMC, thus circumventing the transfer provisions
of the Agreement and
also ostensibly removing aspects of “the Work” from
Tasima, in blatant disregard of paragraph
3 of the Strijdom Order.
[54]
The DoT is bound, in terms of the Agreement and the Mabuse and
Strijdom Orders, through its officials, including the DG and
Koekemoer, the latter insofar as he may still directly or indirectly
be involved, as is suspected, to perform its obligations under
the
Agreement and not to reroute any Work away from Tasima. Furthermore,
the Respondents are not entitled unilaterally to transfer
their
court-ordered obligations to another entity which is not bound in
terms of the Orders, or siphon any Work away from Tasima.
The
Respondents’ attempts to do so constitute a clear breach of the
Agreement and the Mabuse and Strijdom Orders.
Koekemoer’s & RTMC’s
Answer:
[55]
Koekemoer, whose lack of authority was attacked by the applicant at
the hearing of the matter, as was already referred to in
this
judgment, simply states as follows: “The management of the
eNaTIS system by the RTMC on behalf of the DoT does not involve
the
DoT transferring its court-ordered obligations to the RTMC, or the
rerouting of work under the Agreement away from the Applicant
in
breach of the Strijdom Order. Rather, the RTMC manages the eNaTIS
system on behalf of the DoT by way of the DoT performing its
obligations under the Agreement (in compliance with the Mabuse Order
and Strijdom Order).'" RTMC’s answer is similar
and relies
on “RRM 1” to RTMC’s answering affidavit.
[56]
As already indicated despite Tasima’s repeated requests, it
was only on 6 June 2013, that the State Attorney wrote the
letter
which is “FM 34”, which stated that “the
administration of the eNatis has now been transferred to [the
RTMC]”.
It was by no means clear, from that letter that all the DoT and the
DG were intending to convey was that RTMC was
now the “Project
Manager”. Were that the intention, this should have been
clearly stated in the letter. As explained
below, the implications of
“FM 34” are apparently more extensive than simply
appointing a new Project Manager. In the
circumstances, Tasima was
fully justified in seeking the relief which it seeks in this present
application as the transferring
of the administration of the eNatis
to RTMC was clearly in breach of the Agement and the Strijdom Order.
FAILURE TO CONVENE e/NaTIS GOVERNANCE
STRUCTURES Tasima’s Case:
[57]
The eNaTIS governance structures, envisaged under schedule 11 to the
Agreement (“FM 5” to the founding affidavit),
which
previously operated in the DoT and Tasima's implementation of the
Agreement include the National Steering Committee, of which
the
Project/Program Manager is the chairperson; and regular meetings with
provinces and the eNaTIS User Group in respect of each
province. At
all material times these structures were active and important.
[58]
For over one year, the DoT, the DG and Koekemoer had failed and
refused, despite repeated requests from Tasima, to take all
steps
necessary to convene the eNaTIS governance structures. Paragraph 4 of
the Strijdom Order was specifically directed at compelling
the
Respondents to convene these governance structures, yet they have not
done so. Instead of complying with the terms of the Strijdom
Order,
all the DoT has done is remove its Project/Program Manager, thus
further impeding the implementation of governance structures.
[59]
Tasima has insisted that the Respondents implement the various
governance structures as required under the Agreement and the
Strijdom Order, in writing on at least 3 occasions, namely -
59.1
in the 16 May 2013 letter - “FM 32” to the founding
affidavit;
59.2
in the 30 May 2013 letter - “FM 28” to the founding
affidavit;
59.3
in the 6 June 2013 letter - “FM29” to the founding
affidavit.
[60]
The Respondents’ failure and refusal to convene the structures
is highly prejudicial to Tasima and the orderly conduct
of the eNaTIS
system and in clear breach of the Respondents’ obligations
under the Agreement and the Mabuse and Strijdom
Orders.
Koekemoer’s & RTMC’s
Answer:
[61
] Koekemoer refers to -
61.1
Schedule 11, Clause 1.1 of the agreement which provides that
management of the eNaTIS services and the relationship between
the
parties shall vest in the National Steering Committee (of which the
eNaTIS User Groups in each province are sub-committees)
constituted
in accordance with the provisions of clause 1.3.; and
61.2
Clause 1.3.6 which provides that the National Steering Committee
“shall meet on an ad hoc basis during the currency of
this
agreement upon the request on reasonable notice of any Party”.
[62]
Koekemoer states that the Strijdom Order was granted on 26 March
2013, and that there has since, been no “request on
reasonable
notice” on the part of Tasima for the National Steering
Committee to meet. In the circumstances Koekemoer states
that he and
the DG are not in contempt of paragraph 4 of the Strijdom Order
alternatively, if the Strijdom Order was not complied
with “stricto
sensu, such non-compliance was not due to any wilful or mala fide
refusal to obey the order”.
[63]
Remarkably, a totally different answer is furnished by RTMC in RTMC’s
answering affidavit. RTMC states as follows -
63.1
Koekemoer has informed Adv Gerber (of RTMC) that because of the
dispute relating to the duration and status of the Agreement
the
Provincial Departments of Transport, which are party of these
governance structures, “refuse to convene these structures”
because they do not want to “partake in an unlawful agreement”;
and
63.2
RTMC will issue a notice on or before 5 July 2013 for meetings of
these structures, but convening these structures may take
longer than
the 20 days prayed for in prayer 6 of the Notice of Application. RTMC
also states that Tasima was at fault for not
joining these provincial
structures.
[64]
These responses are again spurious. First paragraph 4 of the Strijdom
Order is clear and unequivocal. It requires the DoT,
the DG and
Koekemoer “to convene, forthwith, the eNaTIS governance
structures, contemplated in schedule 11 to the agreement”
(emphasis supplied). It was not for Tasima to call for a meeting. The
Court Order explicitly ordered who should convene the meeting
and
that the obligation to convene the governance structures immediately,
clearly rested on the DoT, the DG and Koekemoer and there
is
self-evidently no scope for misunderstanding the terms of the
Strijdom Order. Secondly, in any event, the fact that the National
Steering Committee performs a pivotal role is demonstrated by
Koekemoer himself in paragraph 9.2 of his answering affidavit where
he states that the National Steering Committee must approve “change
notes” for the various third party contracts (dealt
with
below). Thirdly, despite the clear terms of the Strijdom Order, which
were agreed to by all parties concerned, including Koekemoer,
on 26
March 2013, absolutely no attempt whatsoever was made to convene
these structures. Instead RTMC will now make the first attempt
on 5
July 2013, almost 4 months after the Strijdom Order. This is an
obvious and blatant defiance of the Strijdom Order. Fourthly,
if the
provinces were unwilling to convene the structures, and it was
impossible for the Respondents to comply with the Strijdom
Order, it
is not clear why the Respondents agree to convene the meeting it in
the first place? Fifthly, if the provinces refuse
to cooperate on the
basis that the Agreement is allegedly “unlawful” it could
only be because they were advised that
the Agreement was allegedly
unlawful by the DoT and its agents. The DoT obviously conveniently
failed to advise the provinces that
they were obliged to comply with
the terms of the Agreement by various Court Orders until the dispute
was finalised by arbitration.
FAILURE
TO AUTHORISE CONCLUSION OF CONTRACTS Tasima’s Case:
[65]
In performing its role under the Agreement, and in accordance with
the procedures always employed thereunder, Tasima would
enter into
various agreements in respect of, inter alia, leases and the
provision of essential services to the eNaTIS system from,
inter
alia, Telkom and the South African Post Office ("SAPO").
Without such contracts, the necessary services required
to operate
the eNaTIS system would be undermined, and the housing of the eNaTIS
system itself would be jeopardised.
[66]
In order to enter into the necessary contracts, Tasima requires
authorisation from the DoT; however, with no lawful explanation
or
reason, the DoT has, for some months, refused to grant the necessary
contract authorisations.
[67]
To date, the following agreements, all of which are essential for the
integrity and continued operation of the eNaTIS system,
remain
unauthorised:
67.1
lease agreements in respect of various premises;
67.2
Telkom agreement;
67.3
SAPO agreement;
67.4
HP Hardware service agreement;
67.5
Remedy support agreement;
67.6
LAN Desk licenses.
[68]
The papers show that from January 2013 Tasima has made numerous
demands for the DoT to authorise the renewal of these agreements.
68.1
Between January and May 2013 Tasima's Ms Alida Hills and Mr Gustav
van Vuuren have repeatedly requested Koekemoer orally to
authorise
the renewal of the agreements.
68.2
On 30 January 2013 Webber Wentzel addressed a letter to the State
Attorney, which appears as “FM 38” to the founding
affidavit. In this letter Webber Wentzel highlighted this issue,
stating that "Mr Koekemoer also continued to refuse to renew
the
agreements related to the South African Post Office and Telkom
services and the building lease agreements - all of which are
central
to [Tasima's] provision of services in respect of the eNaTIS system”,
and called for the agreement renewals to be
attended to without
further delay, but alas, with no effect.
68.3
The 6 June 2013 letter - “FM29” to the founding affidavit
- repeated the call for contract authorisations.
[69]
Such agreements have always been authorised in the past and the DoT
has at no point proffered any reasons for its sudden failure
to
provide the relevant authorisations now.
[70]
The Respondents’ failure and refusal to authorise the
agreements is highly prejudicial to Tasima and the orderly conduct
of
the eNaTIS system and in clear breach of the Respondents’
obligations under the Agreement and the Mabuse Order as well
as the
Strijdom Order, to the extent that it is an attempt to divert any of
the Work away from Tasima and can lead to the crashing
of the eNaTIS
system which system is to remain operative in the National interest,
at all times.
Koekemoer’s & RTMC’s
Answer:
[71]
Koekemoer states that:
71.1
Prior to renewal of a third party contract that has expired, a change
note needs to be approved by the National Steering Committee;
and
71.2
The standard procurement procedures in place within the DoT for the
renewal of a third party contract include approval of a
change note
by the National Steering Committee which must thereupon be
recommended by the DoT bidding committee for approval by
the
accounting officer, namely the DG.
[72]
RTMC, mirabile, on the other hand, offers an entirely different
explanation. This is remarkable given the fact that RTMC states
that
it has consulted with Koekemoer on the authorisations sought. RTMC
states that the underlying Agreement is in dispute, and
if RTMC
allows Tasima to extend the said lease agreements in Tasima's name,
and the Agreement is ultimately found to be void, then
“[the
DoT] would have authorised [Tasima] to enter into these long term
lease agreements when their substratum ... have fallen
away. It is
for this reason that [Koekemoer] has previously refused to authorise
an extension of these agreements”, and RTMC
will similarly not
authorise an extension of these agreements. RTMC states that “the
landlords and service providers ...
are ... happy to proceed on a
month to month basis pending the resolution of the status of the
agreement...”.
[73]
Koekemoer’s responses are a clear contrivance. Firstly the EPP
(“FM7” to the founding affidavit) expressly
contemplates
the conclusion of third party contracts. Therefore reference to “the
standard procurement procedures”
is misplaced. Secondly, even
if the conclusion of these contracts requires the approval of the
National Steering Committee, the
DoT, the DG and Koekemoer have,
through their own inactivity (and through a breach of the Strijdom
Order) failed to convene the
National Steering Committee, as already
demonstrated. Thirdly, the explanation advanced by RTMC has never
been advanced or ventilated
in correspondence.
[74]
Clearly therefore, the DoT, the DG and Koekemoer are in breach of the
Mabuse Order, and their breach is contemptuous.
THE URGENCY OF THE MATTER
[75]
Our courts have held that, since it is vital to the administration of
justice that those affected by court orders obey them,
disregard
cannot be tolerated and contempt applications are by their nature
urgent. (See Civil Procedure in the Superior Court,
by Harms, at para
B45.4, B-316 - B-317 and the cases cited in footnote 2. In
particular: Protea Holdings Ltd v Wriwt
1978 (3) SA 865
(W); Mutebwa
v Mutebwa
2001 (2) SA 193
(Tk); Federation of Governing Bodies of
South African Schools (Gauteng) v MEC for Education, Gauteng
2002 (1)
SA 660
(T); Laubscher v Laubscher
2004 (4) SA 350
(T); and Victoria
Park Ratepayers Association v Greyvenouw CC
[2004] 3 All SA 623
(SE).) Firstly, prayer 3 of the notice of motion seeks an order (1)
to make payment of approximately R118 million, which, as appears
from
the founding affidavit, Tasima is in desperate need of; (2) to grant
various Outstanding Authorisations, which the DoT did
not even
collect and even refused to take delivery of; (3) to authorise the
conclusion of various long term agreements; and (4)
to clarify who
the Project / Programme Manager was. Quite apart from the fact that
contempt applications are, by their very nature,
urgent, Tasima
explained, in great detail, why this relief was urgent and critical
to the continued operation of the eNaTIS system.
It is therefore
unclear how RTMC can suggest that the relief is not urgent.
[76]
The law on this issue being clear, Tasima, in any case, has made out
a case as to why it is imperative in the National interest,
to the
operation of the eNaTIS system not being disturbed that the DoT, the
DG and Koekemoer comply with their obligations under
the Agreement
and the Mabuse and Strijdom Orders as a matter of urgency. This is
set out fully in the founding affidavit at paras
96 - 103, pp 42 -
44. It is unnecessary to repeat these reasons here. In any case in so
far as the aspect of a possible overpayment
to Tasima taking place
this can in any case be checked and rectified later. Contracts being
renewed also present no problem as
they did not present problems in
the past and it is only now the Respondents who are rocking the boat
with a clear objective of
getting Tasima out of the way. The Courts
will not tolerate such devious conduct.
THE RELEVANT LEGAL PRINCIPLES
[77]
Our courts draw a distinction between judgments sounding in money (ie
a judgment ad pecuniam solvendam) which is one in which
the judgment
debtor is ordered to pay a specific sum of money; and judgments for
the performance of certain acts (ie a judgment
ad factum
praestandum). Money judgments are not ordinarily enforced by contempt
proceedings. Money judgments are enforceable by
execution. (See
Jayiya v Member of the Executive Council for Welfare, Eastern Cape,
and another
2004 (2) SA 611
(SCA) at para [15]. See also Nyathi v MEC
for Department of Health, Gauteng and another
2008 (5) SA 94
(CC)
which resulted in the amendment of the
State Liability Act 20 of
1957
, in order to allow for the effective execution against the state
of money judgements.) On the other hand, orders for the performance
of specific obligations not sounding in specified monetary amounts
are enforceable by proceedings for civil contempt.
[78]
This application primarily concerns the failure of the DoT and the DG
to comply with certain performance obligations and, in
particular,
the obligations of the DoT and the DG to “perform its
obligations in terms of the agreement” as provided
for in the
Mabuse Order, which are vital for the continued operation of the
eNaTIS system. The same applies to Tasima’s claim
for payment
of R118 million so as to enable it to carry on with the running of
the eNaTIS system. As appears from what is set out
above, there is no
valid dispute in relation to the Respondents’ obligation to
make payment of this amount. Despite having
approved the underlying
PRQs, the Respondents seek to withhold payment of these amounts in
flagrant violation of the terms of the
Agreement. In the
circumstances, these contempt proceedings are brought principally in
respect of orders ad factum praestandum.
[79]
Civil contempt is the wilful and mala fide refusal or failure to
comply with an order of court. This was confirmed in Fakie
NO v CCII
Systems (Pty) Ltd
[2006] ZASCA 52
;
2006 (4) SA 326
(SCA). (See also S v Sigwahla 1967
() SA 566 (A); S v De Bruyn
1968 (4) SA 498
(C); S v NguBane
1985 (3)
SA 677
(A)).
[80]
In Fakie v CCII the court held that whenever committal to prison for
civil contempt is sought, the criminal standard of proof
applies. The
applicant must therefore prove the requisites of contempt beyond a
reasonable doubt, namely (1) the order, (2) service
or notice of the
order; (3) non-compliance with the terms of the order; and (4)
wilfulness and mala fides in the non-compliance.
However, once the
applicant has proved (1), (2) and (3), the respondents bear an
evidentiary burden in relation to (4). Should
the respondent fail to
advance evidence that establishes a reasonable doubt as to whether
his non-compliance was wilful and mala
fide, the applicant would have
proved contempt beyond a reasonable doubt.
[81]
In the present matter Tasima has demonstrated the terms of the Court
Orders. Notwithstanding the absurd contention advanced
by the State
Attorney in its letter dated 9 May 2013 (annexure “FM27”)
to the effect that the Mabuse and Strijdom Orders
were not “served
on the executive authority or accounting officer of the DoT\ it is
clear that the Respondents (the DoT,
the DG and Koekemoer) received
service and notice of the Mabuse and Strijdom Orders and -
81.1
The DoT and the DG sought leave to appeal against the Mabuse Order,
which was refused; and
81.2
the Strijdom Order was made by agreement between Tasima and the DoT,
the DG and Koekemoer’s legal representatives, and
the DoT, the
DG and Koekemoer were, at all times represented by the State Attorney
and by Counsel who appeared, at the time the
Strijdom Order was
handed down.
There
is thus no merit nor truth in the statement of the State Attorney.
[82]
Furthermore, Tasima has demonstrated non-compliance with the terms of
the Court Order on the part of the Respondents..
[83]
No valid explanation has been forthcoming from the Respondents
regarding the reasons for their failure to comply with the various
terms of the Court Order. Either the Respondents have remained
obdurately silent, or they have advanced spurious reasons in their
correspondence and affidavits or they have a hidden agenda. The
First, Second and Third Respondents in this very important matter
did
not file affidavits and kept mum. As such they have shown a blatant
disrespect for the Court and court procedures. Their conduct
will be
met with a punitive costs order.
[84]
Thus, the Respondents have failed to discharge the evidentiary burden
which rests upon them to show that their non-compliance
was not
wilful or mala fide. Indeed, the facts demonstrate the contrary. In
the circumstances, we submit Tasima has proved contempt
beyond a
reasonable doubt.
[85]
Where imprisonment is imposed, it is usually suspended in order to
give the respondent a further opportunity to comply with
the terms of
the order. (See Civil Procedure in the Superior Court, by Harms, at
para B45.4, B-316 - B-317) Prayers 4 and 7 of
the Notice of
Application comply with this imperative, and this formulation of the
form of the relief sought follows closely orders
granted in the
reported cases in contempt proceedings, and in particular, the
decisions in Singer’s Estate v Kotze
1960
(2)
SA 304
(C) and Protea Holdings Ltd v Wriwt
1978 (3) SA 865
(W).
Conclusion
[86]
For the reasons set out above, it is clear that Tasima has made out a
case for relief and that Tasima ought to be awarded its
costs,
including the costs incident upon the employment of two counsel.
[87]
Costs should certainly be awarded on a punitive scale, having regard
to the alarmingly contemptuous attitude adopted by the
Respondents to
compliance with, and the Respondents’ persistent disregard of
and history of non-compliance with the Court
Orders and the contempt
on the part of the DG for not even filing an answering affidavit and
to file an affidavit by Koekemoer
who apparently has been dismissed
by the Department before this application was brought. As such the
contents of Koekemoer’s
affidavit has to be treated, in so far
as the Court can pay attention to it as it apparently was not in the
traditional legal methods
authorised, with a measure of suspicion.
[88]
The costs order wil also be against RTMC who intervened in this
application as the Fifth Respondent. RTMC participated fully
in the
opposition to the relief sought by Tasima; filed a lengthy answering
affidavit; had counsel appear on its behalf at the
hearing; and filed
heads of argument. There is no basis upon which RTMC should not be
obliged to pay the costs of the application.
[89]
Tasima’s counsel advised during the hearing that relief wil be
sought in terms of the amended prayers marked “B”
to
their heads of argument.
[90]
The following order is accordingly made:
1.
The matter is enrolled as an urgent matter and, insofar as may be
necessary, dispensing with the forms prescribed by the Rules
of this
Honourable Court and directing that this application be heard as one
of urgency under Rule 6(12) and the application by
the Road Traffic
Management Corporation, filed, late is also granted and it is allowed
to intervene;
2.
The Court declares the first, second, and fourth respondents to be in
wilful contempt of:
2.1
paragraphs 1.1 and 1.2 of the Order of the above Honourable Court
issued under case number 44095/2012, handed down by the Honourable
Mr. Justice Mabuse on 17 October 2012 the Mabuse Order);
1.1
paragraphs 3 and 4 of the order of the above Honourable Court issued
under case no. 44095/2012, handed down by the Honourable
Mr. Acting
Justice Strijdom on 26 March 2013 (the Strijdom Order);
The
Court declares that the first, second and fourth respondents are
obliged to make payment to the applicant in the amount of R118
502
705,13.
The
Court orders the first, second and fourth respondents to, within one
day of the handing down of this order in open court, to
make payment
of the aforesaid amount of R118 502 705,13 to the applicant.
The
Court orders the first, second and fourth respondents to, within one
day of the handing down of this order in open court:
5.1
to grant the authorisations and Approvals referred to and contained
in the schedule annexed to the supporting affidavit of Fannie
Lynen
Mahlangu marked “FM8” as contained in the papers of the
case ;
5.2
to authorise the conclusion of the agreements set out in paragraphs
90.1 to 90.6 of the supporting affidavit of Fannie Lynen
Mahlangu as
it appears in the papers of this case.
The
Court orders that:
6.1
The second and fourth respondents be committed to imprisonment for a
period of 30 days;
6.2
The order in paragraph 6.1 above will not come into operation if the
first, second and fourth respondents comply fully and timeously
with
all their obligations imposed in paragraph 5 above;
6.3
A warrant of committal is to be issued by this Honourable Court, on
the same papers, duly supplemented as is necessary, if the
first,
second and fourth respondents do not punctually comply with the order
in paragraph 5 above.
6.4
In the event of warrants for the committal of the first, second and
fourth respondents having been issued in terms of paragraph
6.3 above
the Sheriff of this Honourable Court is authorised and directed to by
his signature grant the authorisations and Approvals
referred to and
contained in the schedule annexed to the supporting affidavit of
Fannie Lynen Mahlangu marked “FM8”
as contained in the
papers of the case and by his signature to authorise the conclusion
of the agreements set out in paragraphs
90.1 to 90.6 of the
supporting affidavit of Fannie Lynen Mahlangu as it appears in the
papers of this case.
7.
7.1 Ordering the first, second and fourth respondents to convene a
meeting
by giving notice thereof within 3 days from the handing down of this
judgment, which meeting is to take place within 20
days of the
handing down of this judgment, of all of the eNaTIS governance
structures, contemplated in Schedule 11 to the agreement
(as set out
in paragraph 4 of the Strijdom Order). Should they fail to do so the
Sheriff is directed and authorised to immediately
after the
expiration of the three day period to give by his signature notice of
such a meeting and to convene and if necessary
to hold it.
7.2
Ordering the first, second and fourth respondents to in future
regularly convene meetings of all of the eNaTIS governance
structures,
contemplated in Schedule 11. to the agreement (as set out
in paragraph 4 of the Strijdom Order.). Should they fail to do so
within
a period of three days after receipt of the request to call
the meeting which is to take place within 20 days of the receipt of
the request, the Sheriff is directed and authorised to give by his
signature notice of such a meeting and to convene and if necessary
to
hold it.
8.
It is ordered that:
8.1
the second, and fourth respondents be committed to imprisonment for a
period of 30 days in the event of a failure on their part
to convene
and cause the meetings referred to in paragraph 7.1 and 7.2 above to
be properly held ;
8.2
a warrant of committal is to be issued by this Honourable Court, on
the same papers, duly supplemented as may be necessary,
if the first,
second and fourth respondents do not comply fully and timeously with
the orders in paragraph 7.1 and 7.2 hereof.
9
The first, second, fourth and fifth respondents are ordered to pay
the costs of the matter, jointly and severally, the one paying
the
other to be absolved, on the scale of attorney and own client which
costs will include the costs of two counsel and including
the costs
of the heads of argument and supplementary heads of argument drawn by
them.
P.Z.
EBERSOHN
ACTING JUDGE OF THE HIGH COURT
Applicant’s
counsel: Adv. A. Franklin SC
Adv.
AWT Rowan Applicant’s attorneys: Webber Wentzel
Ref.
R. Appelbaum/ 2313246
First,
Second, Third and Fourth
Respondents’
counsel: Adv. T.W.G. Bester
First,
Second, Third and Fourth
Respondents’
attorneys: State Attorney
Ref.
TC Lithole 6348/2012/Z78
Fifth
Respondents’ counsel:Adv. B. Roux SC
Fifth
Respondent’s attorneys: Mothle Jooma
Sabdia
Inc
Ref.
T.A. Mothle/4238