Millenium Waste Management (Pty) Limited v Chairperson of the Free State Tender Board (1291/2004) [2004] ZAFSHC 30 (11 May 2004)

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[2004] ZAFSHC 30
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Millenium Waste Management (Pty) Limited v Chairperson of the Free State Tender Board (1291/2004) [2004] ZAFSHC 30 (11 May 2004)

IN THE HIGH
COURT OF SOUTH AFRICA
(ORANGE
FREE STATE PROVINCIAL DIVISION)
Application
No. 1291/2004
In the
matter between:
MILLENIUM
WASTE MANAGEMENT
Applicant
(PTY)
LIMITED
and
THE
CHAIRPERSON OF THE FREE
First Respondent
STATE
PROVINCIAL TENDER BOARD
THE
MEC FOR FINANCE:
Second Respondent
FREE
STATE PROVINCE
THE
MEC FOR HEALTH:
Third Respondent
FREE
STATE PROVINCE
COMPASS
WASTE SERVICES
Fourth Respondent
(PTY)
LTD
_____________________________________________________________________
CORAM:
MALHERBE
J.P.
_____________________________________________________________________
HEARD
ON:
7 MAY 2004
_____________________________________________________________________
DELIVERED
ON:
11 MAY 2004
_____________________________________________________________________
During December 2003 the Free State Department Health
invited tenders for the supply and delivery of medical waste services
for the
province for a period of 3 years. A document bearing the
heading “Special Conditions” (Annexure “FA3”) was made
available
to all prospective tenderers. The first condition was a
compulsory site inspection on 7 January 2004 after a visit to the
office
of the Department’s contact person, a certain Mr De
Villiers. Condition 6 reads as follows:
“
A price breakdown (i.e.
labour, equipment, transport etc) regarding the tender price should
be included in the tender document.”
Thereafter
the following words appear in bold letters:
“
FAILURE TO ADHERE TO ANY OF
THESE CONDITIONS WILL INVALIDATE THE TENDER OFFER.”
Applicant and Fourth Respondent were 2 of 9 tenderers.
Applicant’s tender did not include a price breakdown whereas Fourth
Respondent’s
did. On 29 March 2004 the Health Department accepted
Fourth Respondent’s tender. Applicant has now approached the Court
on an
urgent basis for the following relief:
“
2. The pending the
finalisation of the application for review, as referred to in Part B
hereafter, the First Respondent be interdicted
from implementing the
tender with reference DOH 127/03/04 (“the tender”), for the
supply and delivery of medical waste services
in the Free State
Province.
3. That the costs of this
application be reserved pending the outcome of the application for
review, referred to hereafter;
3.1 Save and in the event of any
of Respondent/s opposing the relief sought herein, in which event
that Respondent/s be ordered to
pay the costs of this application;
and
3.2 That the costs of this
application include the costs consequent upon the employment of two
counsel.”
Part
B of the notice of motion seeks the following orders:
“
1. That the decision of the
First Respondent to award to the Fourth Respondent the tender with
reference DOH 127/03/04 (“the tender”),
for the supply and
delivery of medical waste services in the Free State Province, be
reviewed and set-aside.
2. That the tender be remitted
back to the First Respondent for re-decision.
3. That the costs of this
application be paid by the First Respondent;
3.1 Alternatively, jointly and
severally by any of those Respondents opposing this application;
3.2 Which costs are to include
those costs incurred pursuant to Part A hereof; and
3.3 Are to include the costs
consequent upon the employment of two counsel.”
It appears from the affidavit of Mrs Gouws on behalf of
Third Respondent that there is no longer a Free State Provincial
Tender Board
in existence, it having been abolished by provincial
legislation. She also states that Fourth Respondent’s tender was
approved
by the Head of the Department of Health. In any event, she
deposed to her affidavit on behalf of Third Respondent. Fourth
Respondent
also opposes the application.
All the parties agree that this matter is urgent.
Moreoever, it appears from Fourth Respondent’s answering affidavit
(deposed to
by its Managing Director, Mr du Randt) that it has
commenced with implementing the tender on 1 May 2004; has employed 14
people
specifically to render services under the tender and has
already incurred capital expenditure totalling approximately R1,479
million
to purchase equipment and specialised vehicles to transport
medical waste. It has also rented premises in Bloemfontein and has
caused
computers and telephone lines to be installed in these
premises.
Applicant’s
case is set out as follows in paragraph 12 of its founding
affidavit:
“
12. The
Applicant seeks to review the decision of the First Respondent to
award the tender to the Fourth Respondent, on the grounds
that at the
first site inspection, the Applicant was instructed by the First
Respondent’s representative that it was not necessary
for the
Applicant’s tender to include a breakdown of its tender price, this
being one of the “special conditions” of the tender.
Based on
this representation, the Applicant was induced by the First
Respondent not to include this particularity in its tender.
Despite
the First Respondent’s aforesaid instructions, it has nevertheless
seen fit to invalidate the Applicant’s tender, on
the ground that
the Applicant’s tender was not accompanied by a breakdown of its
tender price.”
It is common cause that the official referred to in this
paragraph is a certain Mr de Villiers. He did not depose to an
affidavit.
On behalf of Third Respondent Mrs Gouws says the
following in reply to paragraph 12 of Applicant’s founding
affidavit:
“ 16.
16.1 I deny that the First
Respondent’s representative advised the Applicant or any other
tenderer that it was not necessary to
include a breakdown of the
tender price in the Applicant’s or anybody else’s tender. There
was thus no misrepresentation on
the part of any official of the
Department. I, at all times, was with Mr De Villiers, an Assistant
Director: Environmental Health,
who at the time was an Environmental
Health Inspector and an expert in this field. At the site meeting he
handled the technical specifications.
It was I who dealt with the
tender document at the pre-site meeting in the offices of Mr De
Villiers. To the best of my knowledge
Mr De Villiers did not even
know of the contents of the tender document.
16.2 On the 7
th
of February 2004 there was a pre-site meeting in the Board Room of Mr
De Villiers’ office. I dealt with the administrative matters
relating to the tender and emphasized various aspects thereof. One
of the aspects I specifically emphasized were the six items referred
to in “FA3”. I specifically emphasized that the tenderer’s
office would be invalidated in the event of any failure to adhere
to
the conditions referred to in “FA3”. I admit that the
Applicant’s tender was invalidated on the basis that it was not
accompanied
of a breakdown of its tender price. There were, however,
no instruction that these conditions need not be complied with. To
the
contrary, such instructions or representation would be contrary
to standard policy and procedure.”
Mr Venter, a special projects manager employed by Fourth
Respondent, attended the site meeting on 7 January 2004. He confirms
Mrs
Gouws’ account quoted above by saying that
“
he does not recall De
Villiers informing anyone gathered at the site inspection that they
should not concern themselves with the requirement
of a price
breakdown and that it would be sufficient for the purposes of
submitting a valid tender if only the total monthly price
was set out
in the pricing schedule.”
On this crucial issue there is, therefore, a dispute of
fact. On behalf of Applicant Mr Wasserman suggested (in the
alternative)
that this dispute should be referred for oral evidence
as it is capable of speedy resolution. His main argument was that
Applicant
had satisfied all the well-known requirements for a
temporary interdict. I intend dealing only with the requirements of
irreparable
harm and the absence of another satisfactory remedy.
Irreparable harm:
The main relief sought by Applicant is set out in prayer
2 of the notice of motion viz. to interdict the province from
implementing
the tender awarded to Fourth Respondent. It appears
from Third and Fourth Respondents’ answering affidavits that a
contract has
already been concluded between the province and Fourth
Respondent and that the latter has been rendering services in terms
of the
contract since 1 May 2004. It follows that the tender has
already been implemented and that its implementation cannot now be
interdicted.
The
harm that Applicant foresees is a loss of revenue from 4 of the 32
provincial hospitals in the Free State; the retrenchment of
workers
already trained by it and the loss of revenue from the sale of
medical waste containers to the remaining 28 hospitals. In
reply to
these allegations Third Respondent says the following:
“ 53.
While one of the reasons for the
tender was because of the new legislation which was being anticipated
the main reason for the tender
was because the hospitals did not have
the capacity to dispose of their own waste material. Such disposal
was not in accordance
with the environmental legislation applicable;
certain mishaps had occurred, such as the starting of a fire in the
veld and there
was every possibility that had the situation remained
as it was the Department of Health would have been subject to legal
proceedings.
It is therefore essential for the contract in respect
of all relevant Provincial Hospitals to be executed.
54.
In view of the contract already
concluded between the Third and Fourth Respondents, the rights and
obligations contained therein,
and the urgent need for the disposal
of all waste material to be outsourced there are no grounds for the
granting of an interdict.”
On behalf of Fourth Respondent Mr Pammenter correctly
points out that loss of revenue is not irreparable. If Applicant can
prove
the alleged misrepresentation by De Villiers and that it has
lost revenue as a result thereof, it can claim damages from the
Province.
There is no suggestion that such a claim cannot be met.
No other satisfactory remedy:
What I have said above regarding a claim for damages
applies equally to this requirement for a temporary interdict.
In
my view Applicant does not meet the requirements for a temporary
interdict.
Both Applicant and Fourth Respondent made use of the
services of two counsel. This matter is of sufficient importance to
both parties
to merit the employment of two counsel. There is no
reason to deprive the successful party of the costs of a second
counsel.
In the result the application is dismissed with costs,
including the costs of two counsel.
____________________
J.P. MALHERBE, J.P.
On Behalf of Applicant:
Adv.
J.G. Wasserman SC
assisted
by:
Adv.
A.J. Eyles
instructed
by
Webbers
Bloemfontein
On Behalf of Third Respondent:
Attorney
I.P. Gough
State
Attorney
Bloemfontein
On Behalf of Fourth Respondent:
Adv.
C.J. Pammenter SC
assisted
by:
Adv.
A.V. Voormolen
instructed
by
Israel,
Sackstein & Matsepe Inc.
Bloemfontein
/scd