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[2012] ZAFSHC 19
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Compass Waste Services (Pty) Ltd v MEC: Department of Health of the Free State Province and Another (4411/2011) [2012] ZAFSHC 19 (16 February 2012)
FREE STATE HIGH
COURT, BLOEMFONTEIN
REPUBLIC OF SOUTH
AFRICA
Case No.: 4411/2011
In
the matter between:
COMPASS WASTE
SERVICES (PTY) LTD
….........................
Applicant
and
THE MEC: DEPARTMENT
OF HEALTH OF THE
FREE STATE PROVINCE
…..........................................
1
st
Respondent
SOLID WASTE
TECHNOLOGIES SA (PTY) LTD
…....
2
nd
Respondent
_____________________________________________________
JUDGEMENT:
RAMPAI J
HEARD ON:
26 OCTOBER 2011
_____________________________________________________
DELIVERED ON:
16 FEBRUARY 2012
[1] The matter came to
court by way of motion proceedings. The applicant initially sought to
have the respondent immediately interdicted
and restrained from
implementing the decision of the Free State Provincial Tender Board
to award a tender bid to the second respondent
pending the outcome of
its application to have such an administrative decision subsequently
reviewed by this court in due course.
[2] The application was
opposed by the second respondent. The interim relief was framed in
the form of a rule
nisi
calling upon the respondent to show
cause why such an interim interdict and ancillary relief should not
be granted. The first respondent
adopted a neutral stance but only
sought costs against the unsuccessful party be it the applicant or
the second respondent.
[3] The applicant’s
papers or rather notice of motion consisted of two parts. The first
part, described as part ‘a’,
concerned the interim
relief, in other words, the interim interdict while the second part,
labelled part ‘b’, concerned
the ultimate relief, in
other words, the final review. This judgment is concerned only with
the interdict component of the combined
application.
[4] First the profile of
the applicant. The applicant was the previous service provider of
medical waste management services for
the Free State Province. It
rendered such services, technically called health care risk
management services, by virtue of a public
tender contract awarded it
by the responsible Provincial Tender Board under the auspices of the
first respondent. The applicant
has rendered such services since
September 2007. The rendering of the services entailed the supply, by
the applicant, of containers
for medical waste generated by the
institutions such as hospitals, clinics, morgues, psychiatric
complexes and laundries, for the
removal of such waste, the
transportation of such waste containers to a central treatment
facility, the treatment and ultimate
disposal of such waste.
[5] The applicant renders
such services elsewhere throughout this country. The consumers of
such services are public as well as
private institutions. The Free
State Province has five regions, namely: Xhariep, Motheo,
Lejweleputswa, Fezile Dabi and Thabo Mofutsanyana
districts.
Initially only the region of Motheo was awarded to the applicant in
September 2007. The other four regions were contractually
awarded to
a different business enterprise, EnviroServ, at the same time.
Through cession, tender contracts in respect of the four
regions were
subsequently transferred by EnviroServ to another business enterprise
called Psychem. The transfer was prompted by
the inability of the
aforesaid competitor, EnviroServ, to execute the tender contract.
[6] By 8 February 2010
the public functionaries of the first respondent became aware that
the second competitor, Psychem, was also
not satisfactorily rendering
the services in the region of Thabo Mofutsanyana. A week later, on 16
February 2010 they also realised
that there were widespread similar
problems in the regions of the Lejweleputswa, Fezile Dabi and Xhariep
as well. The services
had collapsed in those regions as well. The
first respondent then approached the applicant and requested the
applicant to provide
quotations in respect of the four regions that
were in a crisis.
[7] Up to then the four
troubled districts had been serviced by a substitute competitor of
the applicant. On 30 April 2010 the applicant,
stepped forward with
an emergency rescue operation. The take-over meant that the applicant
was required to service all the five
regions, in other words, the
entire Free State Province. The applicant did so. The subsequent
agreement, just like the original
agreement, between the applicant
and the first respondent was supposed to endure until 31 October
2010. However, the applicant
remained on site afterwards by agreement
between the parties. The contract was extended from month to month.
The final extension
was on 31 October 2011.
[8] Meanwhile the first
respondent publicly invited bids for a new three-year tender contract
for the provision of medical waste
management services at various
institutions in the province (annexure “b”). The second
respondent and some other competitors
tendered to render the
services. The applicant submitted two separate bids. The second
respondent rendered one bid.
[9] The first respondent
presented a schedule of its expenditure relative to the medical waste
services for the previous calendar
year, 1 January 2009 – 31
December 2009 (annexure “d”). The following statistical
information may be gleaned
from the annexure:
●
From
Xhariep district with 4 collection facilities a total of ± 6
054kg of medical waste was collected at the total costs
of ±
R3 648 for the year.
●
From
Motheo district with 10 collection facilities a total of ± 640
691kg of medical waste was collected at the total costs
of ±
R3 433 967 for the year.
●
From
Lejweleputswa district with 8 collection facilities a total of ±
183 618 kg of medical waste was collected at the total
costs of ±
R1 140 265 for the year.
●
From
Thaba Mofutsanyana district with 14 collection facilities a total of
± 136 536 kg of medical waste was collected at
the total costs
of ± R1 022 819 for the year.
●
From
Fezile Dabi district with 8 collection facilities a total of ±
193 909 kg of medical waste was collected at the total
costs of ±
R1 266 267 for the year.
[10] On 10 November 2010
the applicant addressed a letter (annexure “e”) to the
first respondent and complained about
certain anomalies. Firstly, the
applicant complained that the tender document itself was ambiguous.
It was concerned about the
packaging discrepancies or inconsistent
specifications. The applicant asserted that the tender document was
unclear as to whether
the successful bidder would be required to
package the medical waste using the plastic bags only or cardboard
boxes in addition
to such plastic bags. Obviously the way the waste
was to be packaged was a factor which would have an impact on the
pricing of
items and on the transportation costs of the waste from
any local collection facility to the central treatment site.
[11] Secondly, the
applicant also complained that the statistics as per expenditure
schedule (annexure “d”) were materially
inaccurate as
regards the actual costs expended during the previous year. The
complaint was that, although tonnage statistics were
reasonably
accurate, the pricing statistics were hopelessly inaccurate. The
applicants’ concern was that such low and wrong
prices would
induce potential services providers or bidders to bid low, gain an
unfair advantage, and win a tender contract at
the expense of the
applicant whose bid was based on accurate and actual pricing rates of
the previous year. The danger of all this,
the applicant maintained,
was that any bidder who based its pricing on those wrong statistics
could win the tender contract but
would fail to execute the contract.
In that event, the required services would collapse as they once did.
[12] Notwithstanding the
applicant’s concerns, the first respondent took no further
action. The first respondent did not even
acknowledge the applicants’
concerns. On the 26 September 2011 the first respondent informed the
applicant that its bid was
unsuccessful; that the second respondent
had been awarded the tender contract; that the applicant’s
services agreement would
finally come to an end on the 31
st
October 2011 and that the applicant was requested to remain on
standby to assist the second respondent to settle.
[13] The applicant
averred that despite requesting reasons on the very next day, 27
September 2011, for the administrative decision,
no reasons were
given. The applicant’s queries were ignored. On 14 October 2011
the first respondent publicly made it known
via Tender Bulletin that
the second respondent was the successful bidder of the tender
contract BID-DOH(FS) 30-2010/2011: Healthcare
Risk Management. The
contract is valid for 3 years from 12 September 2011 to 11 September
2014 (vide annexure s.u.p. 2). The pricing
of the second respondents
were published in the Tender Bulletin.
[14] According to the
applicant the second respondent used the wrong pricing statistics
(annexure “d”) and wrongly tendered
to render the
services by simply bidding similar prices for all the different five
regions. The applicant’s contention was
that the second
respondent’s bid was not a viable economic proposition. Because
it was unrealistic, the services were bound
to collapse. The collapse
would pose serious health hazards. It was not in the public interest
to let such a dangerous situation
develop.
[15] The applicant was
aggrieved. It reckoned that the second respondent’s significant
under-costing for the waste services
gave the second respondent an
unfair advantage which ultimately enhanced its prospects to win the
tender, and did win. The cheaper
and attractive pricing rates were
deceptively induced by the first respondent’s misinformation.
The applicant warned that
the second respondent would not be able to
operate economically and that a likely collapse of waste services in
the province, with
catastrophic adverse impact on health and
environment, was looming large on the horizon.
[16] The aforegoing
concludes the applicant’s corporate profile and the historical
background of the circumstances which precipitated
the urgent launch
of this two-pronged application on 14 October 2011 for hearing on 26
October 2011.
[17] I now turn to the
corporate profile of the second respondent. The second respondent is
a corporate enterprise. It specialises
in healthcare risk waste
management services throughout this country. It delivers such
services in all the nine provinces. Besides
public institutions such
as hospital, clinics, morgues, laundries and psychiatric complexes,
it also renders such services to private
institutions, for instance
private hospitals, clinics, healthcare laboratories and medical
practitioners.
[18] The second
respondent has been rendering the waste management services since
2005. It averred that because it has a vast experience
of collecting
comparatively greater volumes of medical waste and over substantially
greater geographical areas than its competitor
collects, the tender
contract awarded to it would not present to it any logistical or
financial difficulties to practically implement
and execute the
tender contract.
[19] According to the
second respondent, the medical waste tonnage it was nationally
collecting from various collection sites was
nearly three-fold as
much as the tonnage of medical waste the second respondent was
required to collect under the 2011 bid awarded
to the second
respondent by the Free State Government.
[20] The second
respondent contended that the grave concerns of the applicant about
the capabilities of the second respondent to
tender the required
medical waste management services were unfounded. It averred that,
based on its vast operational experience,
the pricing rates of its
bid were not ridiculously and uneconomically low for the second
respondent to profitably render the services
to the outlying regions
outside Motheo District. This, in the brief, concludes the second
respondent’s corporate profile.
[21] The decision of a
provincial tender board to award a tender contract is an
administrative action performed by public functionaries
of a
provincial government –
CASH PAYMASTER SERVICES (PTY) LTD
v THE EASTERN CAPE PROVINCE AND OTHERS
1999 (1) SA 324
(Ck).
[22] In the first place,
it was incumbent upon the applicant to prove a
prima facie
right. This is the first requisite of an interim interdict. (See
SETLOGELO v SETLOGELO
1914 AD 221).
[23] Mr Voormolen
contended, on behalf of the applicant, that the applicant has made
out a case for the relief sought. He submitted
that the applicant had
(or has) a
prima facie
right to be given reasons for the
public decision whereby the tender contract in connection with the
medical waste services was
awarded to the second respondent. Once the
required reasons have been given, the applicant would also have a
right to take the
decision on judicial review. He relied on certain
constitutional and legislative provisions.
[24] On behalf of the
second respondent, Mr Snellenburg contended that the applicant had
failed to make out a
prima facie
case for the interim relief
sought. He too relied on certain constitutional and legislative
provisions. He submitted that, although
the applicant had a right to
be given reasons by the first respondent for the administrative
action, the applicant had no
prima facie
right to have the
implementation of the tender contract between the respondents
suspended.
[25] On the 26 September
2011 the first respondent orally informed the applicant that its bid
was unsuccessful. The first respondent
gave no reasons for its
decision to award the bid to the second respondent. The very next
day, on the 27 September 2011, to be
precise, the applicant formally
delivered its written request for such reasons to the first
respondent. On the 14 October 2011
the applicant launched this
application. By then the applicant had still not heard from the first
respondent. Twelve days later
the matter was argued.
[26] The first
respondent, as an organ of the state, was obliged to give the
applicant reasons for its decision. The applicant was
entitled to be
given reasons for the administrative action but that was not where it
ended. There is more to the matter than meets
the eye. The first
respondent was entitled to be given time to consider the applicant’s
request. The applicant’s request
was subject to an important
legislative provision. The first respondent was entitled to a period
of 90 days from 27 September 2011
within which to give the applicant
reasons for its decision – sec 5 Promotion of Administrative
Justice Act 3/2000.
[27] A clinical look at
the facts revealed that the application was prematurely launched. The
applicant rushed to court twelve days
after the commencement of the
ninety day statutory period as envisaged in section 5. It followed,
therefore, that the legal process
was initiated 78 days too early. By
so doing the applicant infringed the rights of the first respondent.
[28] In my judgment the
applicant had no
prima facie
right to be given reasons at the
time the application was launched. To conclude otherwise would mean
that an organ of state was
obliged to give reasons on demand. Such a
finding would certainly be incompatible with section 5. Accordingly,
the applicant had
failed to establish the first requisite of an
interim interdict. The applicant had no
prima facie
right to
have the implementation of the tender suspended.
[29] In the second place
it was incumbent upon the applicant to prove injury or harm to its
right. Here what is required is actual
harm or reasonable
apprehension of harm to one’s right. The applicant’s
right was derived from a tender contract concluded
in 2007. The
lifespan of the contract was three years. In the ordinary course of
events, the contract would have expired on 31
October 2010. However,
the contract was effectively extended by one more year by mutual
agreement between the first respondent
and the applicant.
[30] The first respondent
duly notified the applicant on 26 September 2011 that the tender
contract by virtue of which the applicant
was rendering the services
would finally expire on 31 October 2011. There would be no further
extensions. The current proceedings
were urgently initiated on the 14
October 2011, less than three weeks before the expected end of the
extended three-year contractual
ties. As far back as 2007 the
applicant knew that its relationship with the first respondent would
come to an end at a certain
point in time. When the first respondent
put out a public notice calling for tenders in 2010 the applicant was
reminded that its
days were numbered. The clock was ticking against
its right to render the services.
[31] The first respondent
did not infringe the applicant’s right by calling for tenders
in 2010 or by giving the applicant
final notice. The applicant knew
very well and expected that by 1 November 2011 this contract would
have expired and has since
expired. Both parties knew that as from
that date the applicant would be rightless
viz-á-viz
the first respondent. What reasonable apprehension of harm could the
applicant have had in those circumstances? When there is no
right
there can be no harm. It is a matter of simple logic. What the
applicant contended to be its reasonable apprehension of harm
was
nothing but apprehension in the air. In my view, the applicant has
failed to prove the second requisite for an interim relief.
[32] In the third place
it was incumbent upon the applicant to show that it had no
alternative remedy. Because of its intrinsically
intrusive nature, an
interdict is not readily granted where it is shown that an applicant
has an alternative ordinary remedy that
can similarly provide an
effective and satisfactory protection for the right under threat.
[33] The applicant sought
an interim relief at this juncture but the ultimate relief it really
wanted was to have the administrative
action set aside on review, and
the award taken away from the first respondent by the court and
awarded by the court to the applicant.
Mr Voormolen contended that a
refusal by the first respondent to give reasons for its decision
infringed the right of the applicant.
There is no doubt an unlawful
refusal would frustrate the applicant’s contemplated review
application and undermine the applicant’s
ultimate purpose.
[34] Let me assume that
the first respondent wrongly refused to give reasons as the applicant
contended. The springboard for the
launch of the interdict was the
alleged refusal to give reasons. That was a point of departure in the
current debacle. The ordinary
and alternative remedy available to the
applicant in the circumstances was quite simply to urgently apply to
this court before
anything else: firstly, to have the ninety day
period as stipulated in section 5 reduced and secondly, to have the
first respondent
compelled to expeditiously give reasons for its
decision within a shorter period. Needless to say that the applicant
did not follow
the condonation avenue. Instead, the applicant hurried
to court by way of an interdict, bitterly complained that the first
respondent
refused to give reasons and urged me to prevent the second
respondent from rendering the services as the new service provider in
terms of the 2011 tender award.
[35] Had the applicant
followed that remedial course, who knows what could have happened.
There were possibilities. One of them
was that the first respondent
might have speedily given sound and satisfactory reasons acceptable
to the applicant which would
then have rendered the launch of this
interdict unnecessary. In the light of all this, it could not be said
that the applicant
was remediless. There was, in my judgment, an
alternative remedy available.
[36] If the applicant had
a right, even though it was open to some doubt, which was actually
injured or under some reasonable threat
or harm, there was a
satisfactory and ordinary remedy. Such remedy would have afforded the
applicant adequate and effective protection.
However, the applicant’s
lawful request for reasons did not ripen into a legal right. The
untimely launch of the interdict
application fatally interrupted the
maturity process of the request. As a result of such an abortive step
the applicant had no
right but a mere entitlement at the time the
matter came up for adjudication.
[37] On the facts the
contention that the first respondent refused to give reasons was
untenable. The period as envisaged in section
5 was supposed to run
until the 27
th
January 2012. Before the end of that date
the first respondent could not be correctly of any administrative
remissness on neglect
whatsoever. On the contrary the applicants
disingenuous was in attempting to circumvent section 5, as it did. I
am persuaded by
the submission of Mr Snellenburg that the applicant
has failed to show that it had no alternative remedy.
[38] In the fourth place,
the applicant had to show that the balance of convenience favoured
the grant of the interdict and not
its refusal. On behalf of the
applicant Mr. Voormolen contended that there would be no interruption
of services; that the retrenchment
of the workforce would be averted;
that the rendering of the medical waste services would be continued
by a reliable service provider
with three years experience until the
review application had been decided and that it would be in the
public interests of the inhabitants
of the province to retain the
applicant, a well-equipped service provider with a proven track
record and operational capacity,
on site in order to ensure safe and
riskless collection of hazardous medical waste.
[39] On behalf of the
second respondent, Mr. Snellenburg, disagreed. He submitted that the
scenario on the other side of the fence
was in no way different in
several respects. He stressed that the critical factor was that
second respondent was a successful bidder;
that it had already made
substantial capital layout to provide the services; that it had
acquired equipments for the operations;
that it had concluded
ancillary agreements concerning vehicles, as well as lease of
premises; that it had recruited an engaged
workforce; that it was
capable to execute the tender contract without endangering the
provincial healthcare system, the inhabitants
and the environment;
that it was geared up for big business and that because it has been
successfully operating in all the nine
provinces for nine years, the
applicant was highly experienced in the safe collection,
transportation and destruction of hazardous
medical waste.
[40] The applicant was
supposed to have prepared itself to vacate the operational site. The
various agreements relating to the employees,
the lessors,
equipments, the vehicles and sundry suppliers were obviously
concluded by the applicant fully knowing that the tender
contract
would last until 31 October 2010. The applicant also knew that there
was no guarantee that it would again win the provincial
tender
contract after the expiry date. All that information should have
enabled the applicant to plan and arrange its operations
and business
affairs accordingly. Here the buzzword of the scenario was
downscaling.
[41] The situation as
regards the second respondent was completely different. Here various
new agreements were recently concluded
between 12 September 2011 and
31 October 2011. At the time (14 October 2011) the interdict
application was launched, the second
respondent was probably in an
advanced state of readiness and preparedness to start rendering the
medical waste management services
in terms of the tender contract. It
is clear and obvious therefore, that the second respondent would face
a seriously predicament
if the interdict application should succeed.
What the second respondent has done since the bid was awarded, cannot
suddenly be
undone without paying a heavy price.
[42] The fact of the
matter is that at the end of the enquiry the second respondent had
the right to provide the services as from
1 November 2011. In sharp
contract to the scenario, the applicant would have no such a right.
The balancing act of the two competing
interests showed, in my view,
that the scale of convenience was heavily tipped in favour of the
second respondent. Once again,
the applicant failed on that front.
The fourth requisite for the grant of an interdict was, in my view,
not established. Even if
the first three requisites had been
established, the application for an interdict would fail on this
ground alone.
[43] To succeed an
application for an interdict has to establish all the four requisites
of an interdict. Failure to establish one
of the requirements is
sufficient for a respondent to successfully resist the grant of an
interdict. In this instance, the applicant
has lost the battle on all
four fronts. In the circumstances an interdict was not an appropriate
relief. I am, therefore, inclined
to dismiss the application.
[44] When a court deals
with an interim interdict, as in the instant matter, the ultimate
purpose of such interim relief must be
constantly kept in mind. The
ultimate purpose of the current interdict application is to have the
administrative decision of the
first respondent’s provincial
tender board reversed and the tender contract awarded to the
applicant by the review court.
(part b, notice of motion.)
[45] The contemplated
review application was issued, served and filed simultaneously with
the interdict application. The irony of
the matter was that, on its
own version, the applicant did not know the reasons why the tender
was awarded to the second respondent.
Notwithstanding its lack of
knowledge, the applicant surprisingly brought a review application.
One comprehensive founding affidavit
was made to cover the interdict
application as well as the review application. (
Vide
notice of
motion, part a and part b respectively.) I, therefore, had a curious
situation that at the time the interdict relief
was sought the
applicant did not know on which grounds to attack the administrative
decision on review. Any court would take a
dim view of such a
situation.
[46] Since there existed
no substantive reasons for the attack of the decision of the
provincial tender board, the review application
itself was premature.
Because it was premature, an interim relief sought to underpin it,
was legally absurd. The applicant alleged
that the tender related
disputes take inordinately long time to be finalised. It also alleged
that a further problem was that if
it sat back, allowed the second
respondent to start rendering the services and only approach the
court by way of a review application
in the distant future, it could
suffer damages that it could not recover should its review
application eventually succeed. Those
were the applicant’s
problems if the interim relief was not granted. The argument did not
go up. Firstly, it was a sword
that cuts both ways. If the interim
relief was granted, the second respondent would find itself in pretty
much the same predicament
if it turned out in the future, on review,
that the tender was justly and correctly awarded to it in the first
place.
[47] There was no
authority, apparently, for the proposition that because the
successful bidder, becomes entrenched on account of
inordinate delays
associated with the review processes, the unsuccessful bidder who was
the previous service provider should be
preferred to continue
rendering the services pending the outcome of the review. The
successful bidder becomes entrenched by virtue
of an existing
contract which has to be accepted and honoured as a valid contract,
pending the outcome of the review. There may
well be conceivable
unfair advantage but the fact remains that the unsuccessful bidder
has no contract at all in terms of which
to takeover from the
successful bidder the rendering of the services. Here and unfair
advantage instantly becomes apparent.
[48] In the
MILLENIUM
WASTE
MANAGEMENT (PTY) LTD v THE
CHAIRPERSON OF THE TENDER BOARD: LIMPOPO PROVINCE
2007
JDR 1245 (SCA) - now reported at
2008 (2) SA 481
(SCA)
the
court decided that the successful bidder continue with the operation
in order to avoid disruption. The matter was remitted
to the
provincial tender board to re-evaluate the bids. Obviously, if, after
the re-evaluation of the tendering process, provincial
tender board
found that the bid should have been awarded to the previous service
provider or the unsuccessful bidder, then the
unsuccessful bidder
would simply take over the rendering of the services from the
successful bidder who had been providing the
services in terms of the
tender award that had been revisited and reversed. As can be seen,
the applicant was not without ordinary
remedies. A review application
unheralded by an interim forunner, was but one of the alternatives.
[49] The chief concern of
the applicant was that its tender process lacked transparency. The
complaint was that the provincial tender
board drastically
disregarded the constitutional provision pertaining to procurement –
section 217. The cardinal features
of the tendering process are that
the stake procurement process should be fair, transparent,
competitive, costs effective and equitable.
The applicant contended
that that the tender process relative to the bid, was fundamentally
flawed in that: firstly, the tender
document was ambiguous and,
secondly, the pricing rates for all the districts, save for the
Motheo District, were drastically deflated.
[50] The alleged
ambiguity of the tender document, the alleged wrong statistical
information and the alleged general lack of transparency
concerning
the current tender process, will probably be appropriately raised,
debated and considered during the hearing of the
review application.
The less said about such matters in this interim application the
better. However, I am bound to make certain
comments.
[51] The concern of the
applicant as regards the inaccurate and low pricing rates was
twofold. Firstly, the applicant was concerned
that if its competitors
with whom it was bidding, would be unduly influenced by the low
pricing statistics to tender cheaply and
that unless the applicant
did likewise, the chances of it winning the tender were greatly
diminished. That was very unfair according
to the applicant because
it had insight information that the actual prices for the previous
financial year were a whole lot more
than the bidders were told.
[52] To overcome the
aforegoing problem, the applicant on its own, submitted two bids –
one based on the low, but wrong prices
and the other based on the
high but accurate prices. That the applicant did in order to compete
with the competitors who might
submit deflated tenders, on the one
hand, as well as those who might submit inflated tenders, on the
other hand. By so doing the
applicant ensured that the provincial
tender board would compare apples with apples. The contention,
therefore, that the applicant
was prejudiced by comparing the
incomparables, was a storm in a tea cup. The applicant exercised such
strategic remedy so that
its rival bidders on either side of the
tender fence did not gain an unfair advantage.
[53] Had the applicant
won the tender, nothing would have been heard in that camp about the
alleged irregularities. Mr. Snellenburg
contended that the applicant
was sitting pretty well at the time raking in approximately a profit
of R160 000,00 per month and
that the applicant, through the interim
relief urgently sought, wanted to squat on the tender contract
awarded to the second respondent.
There was much to be said for those
comments. The applicant had no sound reasons for challenging the 2011
tender awarded to the
second respondent. As matter stood when the
matter was argued the applicant’s prospects of success on
review were very bleak.
[54] Secondly, the
applicant gravest concern was that experience had shown or taught
that it was unwise for a provincial tender
board to award the tender
contract to cheap bidders. That was so because, so contended the
applicant, quite often cheap bidders
dismally fail to deliver the
goods as a result of undercosting. When the rendering of services
collapse and the medical waste are
not properly and frequently
collected and removed throughout the Free State Province to be
auto-claved or incinerated in Bloemfontein,
infectious deceases may
spread causing a highly dangerous situation to develop.
[55] The primary task of
the provincial tender board is, has always been and will always be to
ensure that the government gets the
best price for procuring goods or
services and the best value for the price it pays. These are the
prime objectives of public procurement
policy which chiefly informs
the core functions of a provincial tender board. If this is no longer
the case, then the provincial
tender board no longer have reason to
call for tenders or even to exist –
SOUTH AFRICAN POST
OFFICE LTD v CHAIRPERSON, WESTERN CAPE PROVINCIAL TENDER BOARD, AND
OTHERS
2001 (2) SA 675
(CPD) at 875 where Cleaver, J pointed
out that a provincial tender board has a responsibility to conduct
its affairs and to arrive
at its decision in an ambiguous and
economically responsible, and I may add, competitive manner.
[56] It was the
applicant’s case that on 26 September 2011 the first respondent
asked the applicant to be on standby, in other
words, to be on alert
for four months as from 1 November 2011 in order to step in, take
over the medical waste management service
and rescue the province
should the second respondent fail to perform. Now, if such a
contingency plan was indeed in place, then
there was no reasonable or
danger that the medical waste management services in this province,
would collapse. Mr. Snellenburg
argued that it should not really be
the applicant’s concern if the second respondent was prepared
to execute the contract
for less than the applicant. He argued
further that the second respondent had previously executed and was
still currently executing
far bigger contracts elsewhere in the
country.
[57] According to the
second respondent, it was wishful thinking for the applicant to fear
that the previous contractor’s
downfall debacle would ever
recur during the second respondent’s contract period. The
second respondent averred, and the
applicant did not deny it, that it
was the applicant’s
modus operandi
to run to court every
time it lost out and its competitor won the bid. Mr. Snellenburg
criticised the applicant’s conduct
and called upon the
applicant to refrain from behaving as if it were a saviour on the
white horse for this province. The second
respondent, counsel
contended, was ready and capable to render the services without the
aid of any other service provider, but
had no problem if the
applicant wanted to be on standby, but forewarned the applicant that
it would wait in vain if it hoped that
it would ever be called upon
to rescue the services from collapsing.
[58] I am of the firm
view that the applicant failed to make out a case for the grant of
the interim relief sought. The interdict
application cannot but fail.
I decline to arrest the implimentation process. The interdict
application was fatally premature and
defective.
[59] Mr. Voormolen
conceded that if the application failed, there was no reason why the
costs should not be borne and paid by the
applicant. Although the
first respondent had adopted a neutral stance right from the outset,
Mr. Danzfuss asked that the costs
incurred by the first respondent be
paid by the loser whoever the lose might be. The concession made by
Mr. Voormolen on the question
of costs applied to both respondents.
It follows, therefore, that the applicant should also bear the brunt
of the first respondent’s
costs.
[60] These then are the
reasons for the order I made
ex tempore
after hearing legal
argument. For the sake of completeness the relevant part of the order
is repeated. It reads:
“
1.
The application for the interdict is dismissed.
2. The tender awarded by
the 1
st
respondent to the 2
nd
respondent
stands.
3. The applicant is
directed to pay the costs of the respondents.
________________
M.H. RAMPAI, AJP
On behalf of applicant:
Adv. V. Voormolen
Instructed by:
Matsepes Inc
BLOEMFONTEIN
and
Shepstone & Wylie
Attorneys
Umhlanga Rocks
On behalf of first
respondent: Adv. F.W. Danzfuss SC
Instructed by:
The State Attorney
BLOEMFONTEIN
On behalf of second
respondent: Adv. N. Snellenburg
Instructed by:
Phatshoane Henney Inc
BLOEMFONTEIN
/eb