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[2013] ZAFSHC 107
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Molefi Thoabala Incorporated v Mangaung Metropolitan Municipality and Others (2289/2013) [2013] ZAFSHC 107 (27 June 2013)
FREE STATE HIGH
COURT, BLOEMFONTEIN
REPUBLIC OF SOUTH
AFRICA
Case No.: 2289/2013
In
the matter between:-
MOLEFI THOABALA
INCORPORATED
..................................
Applicant
and
MANGAUNG
METROPOLITAN
MUNICIPALITY
..............................................................
First
Respondent
THE CHAIRPERSON OF
BID
EVALUATION
COMMITTEE
...................................
Second
Respondent
THE CHAIRPERSON OF
THE BID
ADJUDICATION
COMMITTEE
...................................
Third
Respondent
MOROKA ATTORNEYS
...........................................
Fourth
Respondent
_____________________________________________________
HEARD ON:
21 JUNE 2013
JUDGMENT BY:
ZIETSMAN, AJ
_____________________________________________________
DELIVERED ON:
27 JUNE 2013
_____________________________________________________
[1] In an urgent
application, the applicant seeks an interim interdict restraining the
fourth respondent from performing any rights
and duties arising out
of Tender Bid No. MMM/BID64:2013/2013, dealing with the
re-registration and deregistration of title deeds
of erven in Thaba
Nchu and Botshabelo, Free State Province. Together herewith, the
applicant seeks an order interdicting and restraining
the first
respondent from performing the rights and duties arising out of
Tender Bid No. MMM/BID64:2013/2013, pending a final determination
of
Part B of the Notice of Motion, being relief sought on review of the
decisions taken by the first respondent, alternatively
the second,
alternatively the third respondents, alternatively all the
respondents in the proceedings in Bid No. MMM/BID64:2013/2013,
insofar as the decision and/or proceedings resulted in nomination of
the fourth respondent as the preferred bidder.
[2] I am called upon only
to decide upon Part A of the Notice of Motion, being the interim
interdict. The requisites for the right
to claim an interim interdict
are as follows:
2.1. A
prima facie
right (although open to some doubt);
2.2. A well-grounded
apprehension of irreparable harm if the interim relief is not granted
and the ultimate relief is eventually
granted;
2.3. That the balance of
convenience favours the granting of an interim interdict; and
2.4. That the applicant
has no other satisfactory remedy.
[3] It needs to be
confirmed that in view of the discretionary nature of an interim
interdict, the aforementioned requisites are
not judged in isolation,
but in interaction with each other.
See
Eriksen Motors
(Welkom) Ltd v Protea Motors, Warrenton and Another
1973 (3)
SA 685
(A).
[4] With reference to the
prima facie
right that should be made out by the applicant,
the requisite is proof of facts that establish the existence of a
right in terms
of substantive law. Furthermore, the degree of proof,
according to Harms:
Civil Procedure in the Supreme Court
, A-41
is formulated as follows:
“
The right
can be
prima
facie
established even if it is open to some doubt. Mere acceptance of the
applicant’s allegations is insufficient but the weighing
up of
the probabilities of conflicting versions is not required. The proper
approach is to consider the facts as set out by the
applicant
together with any facts set out by the respondent which the applicant
cannot dispute, and to decide whether, with regard
to the inherent
probabilities and the ultimate onus, the applicant should on those
facts obtain final relief at the trial. The
facts set out in
contradiction by the respondent should then be considered, and if
they throw serious doubt on the applicant’s
case he cannot
succeed.”
[5] Again, in accordance
with Harms,
supra
, on page A-43, the discretion of the court
is described as follows:
“
A court
always has a wide discretion to refuse an interim interdict even if
the requisites have been established. This means that
the court is
entitled to have regard to a number of disparate and incommensurable
features in coming to a decision, and not that
the court has a free
and unfettered discretion. The discretion is a judicial one, which
must be exercised according to law and
upon facts. On the other hand,
a court has no discretion to grant an interim interdict if the
requirements have not been established.”
See also
Hix
Networking Technologies v System Publishers (Pty) Ltd and Another
[1996] ZASCA 107
;
1997 (1) SA 391
(A)
at 401
.
[6] During argument both
counsel for the respondents abandoned their point
in limine
relating to Uniform Court Rule 16(A), raising of a constitutional
point. However, the respondents still argued that urgency of
the
application was created by the applicant itself and that the matter
should be removed from the roll on this basis alone. I
will deal with
urgency later.
[7] As far as the facts
of this application are concerned, the following needs to be set out:
7.1. During February 2013
the first respondent invited tenders under Bid No.
MMM/BID64:2012/2013 to tender for the “Appointment
of a Service
Provider for the Deregistration and Re-registration of Title Deeds in
Thaba Nchu (Part A) and Botshabelo (Part B)”.
7.2. The evaluation
method determined would be 90/10, which meant that 90% of the tender
is evaluated based on the price, and 10%
is based solely on the
verified B-BBEE status of tenders.
7.3. The closing time for
such tenders was 1 March 2013 and of relevance to this application,
the first applicant and the fourth
respondent’s tenders were
the only tenders to be considered. The applicant tendered to do the
work as invited, at the price
of R650,00 per title deed, whilst the
fourth respondent tendered the amount of R2 500,00 per title
deed.
7.4. It also seems that
17 000 units were at stake, and that the difference between the
two tender bids, was an amount of approximately
R31 million.
7.5. It is common cause
that on 18 April 2013, a certain Sabata Mofokeng, from the office of
the first respondent, phoned the applicant,
calling upon the
applicant to furnish a price breakdown of the R650,00 it tendered per
unit price. Although surprised, the applicant
indeed submitted its
breakdown to Mr Mofokeng.
7.6. It is common cause
that the bid evaluation committee, which evaluated the tenders after
they were opened on 1 March 2013, made
a final recommendation to the
bid adjudication committee of the first respondent, on 17 April 2013,
that the applicant’s
tender should not be allowed because of
the fact, amongst others, but mainly that the applicant’s
tender is a non-responsible
tender.
7.7. In accordance with
the supply chain management policy of the first respondent,
“non-responsible tenders” are defined
as tenders with a
price that is very high or very low and is not considered a fair and
acceptable market price. (The last-mentioned
in terms of paragraphs
16.2.16.2 of the supply chain management policy.)
7.8. Counsel for the
first to third respondents argued that although the bid evaluation
committee referred the bids back for further
investigation on 5 April
2013, and although the bid evaluation committee made a final
recommendation on 17 April 2013 to the bid
adjudication committee
that the applicant’s tender is a non-responsible tender, the
bid adjudication committee (which convened
on 24 April 2013) indeed
considered the information requested from the applicant on 18 April
2013 because, amongst others, in the
minutes of the adjudication
committee, the following was recommended
“
That
Molefi
Thoabala Incorporation
,
have scored the highest procurement points in line with Preference
Procurement Policy Framework Act No 5 of 2000, however the
following
were risks identified, namely:
Project publication cost not included
on price submitted.
Project submitted is unrealistically
low and not market related.
Price submitted is way below
conveyancing fees as prescribed by law societies with deeds office
charges.”
7.9 It was therefore
recommended by the adjudication committee that
“…
the
bid of
Molefi
Thoabala Incorporation
be regarded as non-responsible in terms of clause 16.2.16.2 of the
Supply Chain Management Policy;”
7.10. It is the
applicant’s argument that the information requested from it on
18 April 2013, was not considered by the bid
evaluation committee
(because of the fact the aforementioned committee already made a
final recommendation on 17 April 2013), and
furthermore even if the
further information (the breakdown of the tender price) was put
before the adjudication committee (which
is still not clear) no
provision was made in the terms of reference on which tenders were to
be submitted to the first respondent
of anything more than the price
to be tendered for deregistration and re-registration of the erven
involved. In this regard, and
in accordance with the applicant’s
argument, no specific provision was made in the terms of reference,
for instance, for
advertisement costs, being referred to as project
publication costs in the minutes of the adjudication committee.
7.11. The fourth
respondent also referred to the tables of calculation in accordance
with the guidelines prescribed by the various
Law Societies of deeds
office charges according the list in Notice R166 dated 29 February
2012, published in the Government Gazette
35083. The guidelines refer
to a total amount of R3 718,00 per title deed as being transfer costs
for a property with a value between
R0,00 and R80 000,00.
Therefore, in accordance with the arguments on behalf of the first to
third respondents, as well as
the fourth respondent, a tender price
of R650,00 per title deed, is clearly and obviously too low, and for
that reason a non-responsible
tender.
[8] If reference is made
to the right, or even the
prima facie
right, although open to
some doubt, it is clear that the right referred to is the applicant’s
right to have a fair and justifiable
administrative action by the
first respondent. In this regard the following is of importance:
8.1. Administrative
action that is lawful, must also be reasonable and procedurally fair
as prescribed in section 33 of the Constitution.
8.2. It is not clear
whether bidders in the tender process of the aforementioned matter,
were specifically invited to tender for
anything other than the
deregistration and re-registration of the specific erven in
Botshabelo and Thaba Nchu.
8.3. It is therefore not
clear whether publication costs had to be included in tenders (with
reference to advertisements to inform
the general public as to the
basis of such deregistration re-registration and in general to make
the general public aware of the
reasons for such re-registration and
deregistration of the aforesaid erven).
8.4. Further information
was sought from the applicant on 18 April 2013, whilst the bid
evaluation committee had already made a
final recommendation on 17
April 2013 without taking into consideration such further information
given by the applicant.
8.5. From the minutes of
the meeting of the bid adjudication committee, which made the final
recommendation to the municipal manager,
it is not clear what else
was considered besides the recommendations by the bid evaluation
committee.
[9] The above facts
establish a
prima
facie right. Although I cannot find that the
applicant has made out a clear right, I can find that the applicant
has made out at
least a
prima facie
right although open to
some doubt. It must also be mentioned that at this stage it is not
possible to determine whether the first
respondent had all the facts
before it when it came to a conclusion. That can only be done after
the full record with reasons had
been disclosed and dissected. At
this stage the applicant says he was unfairly treated. The
respondents have not been able to cast
serious doubt on that
allegation by the applicant.
[10] To elaborate further
on the aforementioned paragraph, it is my view on the papers before
me, that because there is such a big
disparity between the bid prices
of the applicant and the fourth respondent, before a court can find
that the administrative action
by the respondent was reasonable and
procedurally fair as required by section 33 of the Constitution, it
must be clear that the
applicant’s bid which is far lower than
the fourth respondent’s bid, and which was rejected, was dealt
with in accordance
with the Constitution, transparently, fair, and in
a cost effective manner. I do not think that this was the case in the
present
matter, and for that reason I find that there was at least a
prima facie
case made out by the applicant, although open to
some doubt.
[11] As far as the
prerequisite of irreparable harm is concerned, I was referred to the
decision of
Nestor and Others v Minister of Police and Others
1984 (4) SA 230
(SWA) at 244, which reads as follows:
“
A
reasonable apprehension of injury has been held to be one which a
reasonable man might entertain on being faced with certain facts
(
Free
State Gold Areas Ltd v Merriespruit (Orange Free State) Gold Mining
Co Ltd
1961
(2) SA 505
(W)
at
515). The applicant for an interdict is not required to
establish that, on a balance of probabilities flowing from the
undisputed facts, injury will follow: he has only to show that it is
reasonable to apprehend that injury will result (
Free
State Gold Areas
case
supra
at
518). However, the test for apprehension is an objective one…
This
means that, on the basis of the facts presented to him, the Judge
must decide whether there is any basis for the entertainment
of a
reasonable apprehension by the applicant.
”
[12] I am of the view
that the applicant has indeed made out a case that it will suffer
irreparable harm if an interim interdict
is not granted in the
circumstances.
[13] As far as the
requisite of other remedies is concerned, it is clear that no viable
alternative remedy exists in the present
matter. The respondents also
referred to internal remedies which could have been exhausted. I will
deal with such internal remedies
herein below.
[14] With regard to the
balance of convenience, the following is of importance:
14.1. The fourth
respondent contends that it had various expenses in this regard, by
the employment of extra employees, the buying
of vehicles, the
distribution of pamphlets, etc. It must be mentioned that these
expenditures had been incurred in a relatively
short timeframe.
14.2. These expenses,
however, can be claimed back by the fourth respondent from the first
respondent, should the fourth respondent’s
tender eventually be
rejected.
14.3. It is of further
importance, on the other hand, that not only the applicant’s
convenience is at stake, but also the
public at large insofar as the
general taxpaying public can expect that a municipality will award a
cost effective tender with
a transparent, fair and just
administrative process.
14.4. Balance of
convenience is often understood to mean that the
status quo
should not be disturbed too much. One has to consider what is
reversible, and what the costs and fairness implications are.
14.5. In the
circumstances I find that the balance of convenience favours the
applicant.
[15] I am therefore of
the view that the applicant should succeed with the interim interdict
pending the finalisation of the review
application referred to in
Part B of the Notice of Motion. As far as costs are concerned, I am
of the view that costs should stand
over until the adjudication of
the review application, mainly because of the fact that I have only
found that the applicant has
made out a
prima facie
right,
although open to some doubt. I am not inclined at this stage to
decide upon the issue of costs.
[16] With reference to
the other points
in limine
, being urgency, and the failure by
the applicant to adhere to the internal remedies, I find that the
application was indeed an
urgent one and that the failure to comply
with the provisions of section 7(2) of the Promotion of
Administrative Justice Act, Act
3 of 2000, would obviously have had
the effect that the contract awarded to the fourth respondent would
have been executed in full
or to a large extent before the internal
remedies would be exhausted. The whole purpose of this application,
with a follow-up application
on review, would have been negated. I
therefore exempt the applicant from exhausting its internal remedies
in terms of section
7(2)(c) of Act 3 of 2000.
[17] On the aforesaid
premises I make the following orders:
17.1. Prayers 1 and 2 of
Part A of the Notice of Motion are granted.
17.2. The costs of the
application as far as Part A is concerned, stand over to be
adjudicated upon during the hearing of Part B
of the Notice of
Motion.
_______________
P. ZIETSMAN, AJ
On behalf of applicant:
Adv D.B. Ntsebeza SC
With him:
X.C. Stemela
Instructed by:
Modise & Modise
Attorneys
BLOEMFONTEIN
On behalf of first,
second and
third respondents: Adv
A.T. Ncongwane SC
With him:
Adv J.S. Rautenbach
Instructed by:
Motaung Attorneys
BLOEMFONTEIN
On behalf of fourth
respondent: Adv A.H. Burger SC
With him:
Adv L. Manye
Instructed by:
Moroka Attorneys
BLOEMFONTEIN
/spieterse