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2024
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[2024] ZALMPPHC 57
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Arocon Mbokodo CC v Mogalakwena Local Municipality (2650/2024) [2024] ZALMPPHC 57 (7 June 2024)
FLYNOTES:
ADMINISTRATIVE
– Tender –
Interim
interdict
–
Municipality
entered a contract with a service provider – Contract work
is not commenced with or concluded – Remains
valid –
Seeks to contract another service provider for same work whilst
first contract subsists – Prima facie
right established –
Applicant and public purse will suffer irreparable harm –
Convenience in the interests of
justice favours granting of
interim interdict – No alternative remedy – Interdict
granted.
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
(LIMPOPO
DIVISION, POLOKWANE)
CASE
NO:2650/2024
(1)
REPORTABLE:
YES
/ NO
(2)
OF INTEREST TO THE JUDGES:
YES
/ NO
(3)
REVISED.
Signature
Date:
2024/06/07
In
the matter between:
AROCON
MBOKODO
CC
APPLICANT
And
MOGALAKWENA
LOCAL MUNICIPALITY
RESPONDENT
JUDGMENT
MONENE
AJ
[1]
At times the conduct of some state organs more so at the local sphere
of government
in this country is mindboggling and indeed more
incredulous than fiction. A municipality enters a contract with a
service provider
pursuant to delivery of a service to the community.
The contract work is not really commenced with, is not concluded, nor
successfully
repudiated and is for all intents and purposes still
valid. The municipality then puts the same contract to tender for the
same
scope of work and seeks to contract another service provider
whilst the first contract subsists. All this done ostensibly with
advice from or at least the presence of well manned legal
administration offices.
Mogalammakapane!!!
The Bapedi
from Ga-Sekhukhune or Ga Mphahlele or the Batswana would exclaim
from being utterly flabbergasted by how all this
happens not much
more than the Nrebeles from Mokopane who would exclaim, "Mmudu!!!
Tjo
tjo
!!!Yho Yhoo
!!! Monro wa banro!!!"
[2]
This is an urgent application for interim interdictory relief brought
in the wake
of the respondent putting out to tender the work and
scope of a contract to construct a road within its geographic area
against
the common cause reality that that very contract was
previously awarded to the applicant. The relief is sought pending the
determination
of action proceedings brought by the applicant in which
the applicant as plaintiff therein seeks to enforce specific
performance
in terms of the contract against the respondent as
defendant therein.
[3]
The respondent mounts a challenge against the application contesting
first its urgency
and in the main, while admitting that it remains
contracted to the applicant, averring that the applicant has within
grasp an alternative
remedy in the form of a damages claim.
[4]
I am called upon to determine whether the matter deserves enrolment
on the urgent
court roll and if so whether, on the merits, it musters
the requirements for interim interdictory relief.
THE
FACTS IN BRIEF
[5]
Following a tender process, the applicant was the successful tenderer
in respect of
a tender issued by the respondent in 2021.
[6]
The contract (Contract Number 18-2020/2021) between the parties
consequently concluded
between the parties on 4 November 2021 was for
the completion of a road between the Mabusela and Masoge villages
inclusive of a
stormwater project.
[7]
A site handover agreed to by the parties to take place on 23 November
2021 was cancelled
by the respondent resulting in the site not being
handed over in an apparent repudiation of the contract which
repudiation was
not accepted by the applicant.
[8]
After this impasse the applicant, on 8 August 2023, caused summons to
be issued against
the respondent seeking an order for specific
performance in terms of the contract. This action is pending.
[9]
On 29 February 2024 the respondent published a new tender for the
completion of the
same Mabusela/Masoge villages road and stormwater.
[10]
The applicant then brought this application on an urgent basis
seeking an interim interdict pending
the determination of the pending
action proceedings.
[11]
The matter served before Kganyago J's urgent roll on 2 April 2024 and
was by agreement removed
on account of the papers being in excess of
500 pages. Subsequently, the matter was post an application to the
Judge President,
by agreement enrolled as a special allocation to
serve before me.
[12]
I am thus called upon to determine the urgency of the matter and if
so enrolled then establish
whether the applicant has adequately
traversed the trite requisites for an interim interdict.
REGARDING
URGENCY
[13]
I note the respondent's contention that urgency remains an issue
before me much as I note that
counsel for the respondent did not, in
submissions made before me, per se proceed to aggressively pursue the
point.
[14]
I must state from the outset that, in my view, it would be a
circuitous, imprudent, and wasteful
exercise to deploy scarce
judicial resources at special allocations only to sidestep dealing
with the merits of opposed applications
meagerly insulated by
dismissing those motions on the technical basis of urgency. Once a
matter is given a special allocation more
so by agreement between the
litigants, it must, in my view, be disposed of on the merits and not
on such dilatory
in limine
points as urgency. In that regard
points
in limine
should, in my view, only be magnified if they
are dispositive of applications.
[15]
It is from that premise that I am inclined to enroll this matter as
urgent and hear and determine
the merits thereof for it certainly
cannot be in the interests of justice that heads of court allocate
matters on special allocation,
secure judges from a very limited
base; that litigants secure counsel, and in this particular matter
expensive heavy artillery
senior counsel who engaged in extensive
preparation at great cost to litigants; that matters are recircled on
the escapist probable
ruse of them not being urgent.
[16]
Even if I be wrong in that approach, I find that the urgency juristic
fact of the absence or
presence of substantial redress in due course
is, on the facts, favoring the applicant. Should the applicant's
interim relief application
be heard in the normal course, the
applicant shall not have substantial redress at all as the proverbial
horse shall have long
been down the turf with the new tender
proceeded with, appointments made, and new contracts entered;
effectively allowing a small
itch involving one party to evolve into
septic leprous wounds affecting and infecting more parties.
[17]
Accordingly, without unnecessarily saddling this judgement with a
plethora of authority simply
for purposes of sounding erudite, I
exercise my discretion in favour of finding the matter to be
deserving of being heard urgently
and thus proceed to hear it as
such.
THE
PARTIES' CONTENTIONS ON THE MERITS
[18]
While in the answering affidavit the respondent appeared to take
issue with the applicant's ability
to satisfy all four requirements
of an interim interdict, it appeared in argument before this court
that the key dispute lay in
whether the applicant has an alternative
remedy to the interdictory relief sought.
[19]
Accordingly, post briefly looking into what answers the facts before
me provide regarding a
prima facie
right, harm or reasonable
apprehension of such and the balance of convenience, I shall deal
with the requirement of an alternative
remedy.
Ad
prima facie right
[20]
The applicant submits that the right it seeks to protect arises from
the contractual relationship
between it and the respondent.
[21]
The respondent hoists several submissions to protest the existence of
the applicant's prima facie
right
in
casu, to wit:
[21.1] That there is no prima facie
right because the applicant's prospects of success in the pending
action are "zero"
owing to the contract having been entered
into subject to availability of funds and the contract having a
clause in terms of which
it could resile or withdraw from the
contract.
[21.2] That the "delay" of
the applicant in instituting the action a year after the respondent
refused to hand over the
site results in the applicants right to
interim relief being forfeited.
[21.3] That there was an irregularity
or irregularities in the process leading to the appointment of the
applicant as the winning
bidder.
[21.4] That because the budget
availability to which that contract was subjected never materialized
no contractual rights vested
in the applicant.
[22]
Volume not always being an equivalent of cogency and correctness, I
find it self evident that none of the above grounds
based on
which the respondent contests the first requirement of an interim
interdict are sustainable.
[23]
There is no dispute that the parties entered a contract and that to
date that contract subsists. There is equally no dispute
that the
intended new tender is for the same scope of work for which the two
parties are contracted.
[24]
It calls for no rocket scientist nor a Sidney Kentridge QC nor a
Thembeka Ncqukaitobi to help determine whether the applicant
has at
least a
prima facie
right arising from the contractual
relationship. There is no evidence remotely suggestive of the
respondent having resiled from
or withdraw from the contract. Counsel
for the respondent had to concede that the respondent never
communicated any pull out from
the contract. On the respondent's own
version, the contract is still in place. Furthermore, protestations
about the availability
of funds to carry through the contract as well
as fresh not pleaded allegations of the contract having been
allegedly procured
irregularly do not subtract from the applicant's
current contractual rights at all, that is, unless and/or until the
contract is
set aside. The less said about a delay in prosecuting an
action
ipso facto
, without any legal process, disentitling a
party from seeking interim relief the better because that does not
negate the applicant's
clear contract-based rights at all. The
sentiment clearly arises from a misplaced reading, misunderstanding
and misapplication
of
National Council of Societies for the
Prevention of Cruelty to Animals v Peter Openshaw(462/07) [2008]
78(RSA)
and because it is a misreading which even if correct
would be inapplicable to the question of the existence of a
prima
facie
right I see no need to expand on the context and meaning of
that authority in casu.
[25]
I have no hesitation thus in finding that the applicant has a prima
facie right in casu
.
Ad
harm being suffered or reasonably apprehended.
[26]
The applicant submitted that should an interim interdict not be
granted it will suffer from the
consequent appointment of new parties
to perform work for which it has already been appointed. It argued
that the failure to protect,
at least in the interim, the sanctity of
its contract with the respondent would subject it not only to
commercial loss but will
by extended reasoning erode its right of
access to courts for meaningful effective relief as its specific
performance-geared pending
action will become moot.
[27]
The respondent counters by stating that even if the new tenderers are
appointed the applicant
will suffer no irreparable harm because
"if
applicant convinces a court, it would be easy to calculate the
damages (what it would have made on the project) and moreover,
the
municipality is able to pay if it must”
. To say that this
reasoning floors the court with manifest shock is an understatement.
God be with us all!!!
[28]
It seems to me utterly uncalled for and callous in the extreme for a
state organ to defend its
possibly irregular and unlawful conduct by
openly advocating a preparedness to spend monies irregularly and
fruitlessly from the
public purse by paying for the same services
twice.
[29]
In this regard I feel compelled to refer to the counsel of the apex
court in the land in the
matter of
Steenkamp NO v Provincial
Tender Board of the Eastern Cape 2007(3) SA 121 (CC)
where in
slightly different circumstances the following was, inter alia,
stated in temperate words less exasperate than of this
court:
" In my view this spiral of
litigation is likely to delay, if not weaken the effectiveness of or
grind to stop the tender process.
That would be to the considerable
detriment of the public at large. The resources of our state
treasury, seen against the backdrop
of vast public needs, are indeed
meagre. The fiscus will ill-afford to recompensate by way of damages
disappointed or initially
successful tenderers and still remain with
the need to procure the same goods or service."
[30]
I cannot rightly and in the interests of justice find that there is
no irreparable harm to be
suffered by the applicant in that redress
thereto is allegedly available and sustainable in the form of an
avoidable, unnecessary,
and clearly pre-meditated wasteful and
fruitless expenditure from the public purse. There is, in my view,
neither rationality,
nor equity nor justice in that approach.
[31]
I thus duly find that should the interim relief sought not be granted
the applicant will suffer
irreparable harm. So too will the public
purse, if I may add and that should be no minor consideration even it
be that the
Setlogelo v Setlogelo
harm concept of 1914
imagined harm only in the context of it attaching to the interdict
applicant. The year now is of course not
colonial 1914 but 2024 in a
constitutional era.
Ad
balance of convenience
[32]
Arguing the balance of convenience the respondent in its heads of
argument submitted that convenience
favours service delivery so that
members of society can benefit from the completion of the road and
stormwater in question. It
was further submitted that the new tender
promises to be less expensive than the currently existing contract.
[33]
I am not persuaded by this argument. Firstly, there is no reason
submitted as to why the ratepayers
and residents can only benefit
from the service if it is offered by the intended yet unknown
tenderer and not if the current contract
which does not have to go
through tedious procurement processes first is implemented. Secondly,
the alleged latent financial prudence
ethic appears to me to be a
ruse in the light of the supra stated intentions of the respondent to
post a successful damage claim,
pay both the new successful tenderer
and the applicant. Thirdly this willingness to pay more than once for
one service which, it
was submitted, the respondent
"can pay
if it must”
, belies the assertion that the current contract
should not be honored because funds are not available. Fourthly, the
residents
and "ratepayers"(assuming that the villagers in
Mabusela and Masoge are paying rates) have been kept in limbo without
the road and stormwater completion since before 2020 when the tender
was advertised to date, with the respondent having no iota
of the
service delivery urgency ethic which has apparently suddenly befallen
them, such that convenience would suggest speedy delivery
and
assuming that there was a reason to suggest that speedy completion
cannot be effected by carrying through the existing contract.
[34]
Convenience clearly in the interests of justice favours the granting
of the interim interdict
than it does the dismissal thereof.
Ad
the question of an alternative remedy
[35]
Addressing the absence of an alternative remedy both parties
highlighted the question of damages
with the applicant stating that
damages are in law not available as a remedy and the respondent
submitting that a claim for damages
is available to the applicants as
an alternative remedy.
[36]
Both Mr. Sasson on behalf of the applicant and Mr. Williams SC on
behalf of the respondent pegged
their submissions on their mutually
exclusive understandings of what the Constitutional Court established
in
Steenkamp NO v Provincial Tender Board of the Eastern Cape
2007
(3) SA 121
(CC)("Steenkamp")
regarding the availability
of damages claims in tender disputes. In that regard Mr. Sasson
argued that Steenkamp has abolished
damages as a remedy available
pursuant to tender disputes. Mr. Williams submitted that his
understanding was that a damages claim
was, post Steenkamp, still
available. Both suggested that whether there is an alternative remedy
depended on whether I interpreted
Steenkamp in accordance in tandem
with either of them.
[37]
As invited by the two parties, I have perused Steenkamp and found its
ratio to be unhelpful to
either of the parties' course. As I
understand
Steenkamp
it was about whether administrative
failures of tender boards were wrongful in a delictual sense such
that those who fell victim
to such irregularities could lodge damages
claims and found, in a split decision, that those administrative
glitches or breaches
of statutory duties by tender boards cannot be a
basis of claiming damages. That is the context under which the
following paragraph
immediately preceding the words from
Steenkamp
at paragraph 55(3) referred to supra arose:
"Imposing
delictual liability on the negligent performance of functions of
tender boards would open the prospect of potential
claims of
tenderers who had won initially. This will be to the detriment of the
invaluable public role of tender boards. A potential
delictual claim
by every successful tenderer whose award is upset by a court order
would cast a long shadow over decisions of the
tender boards. Tender
boards would have to face review proceedings brought by aggrieved
unsuccessful tenderers. An should the tender
be set aside it would
then have to contend with the prospect of another bout of claims for
damages by the initially successful
tenderer..."
[38]
I cannot understand Steenkamp to be an authority to the notion that
for as long as there is a
sniff of a tender, contractual obligations
cannot lead to damages claims and am thus unwilling to be seduced to
a view that Steenkamp
put paid to the availability of damages claims
against municipalities in tender matters under all circumstances.
Clearly, Steenkamp
only dealt with damages claims arising from
disputes centered around delictual liability based on negligence of
tender boards and
does not in my view extend to contractual disputes
between the municipality and its contractual partners.
[39]
Having so found however, I cannot find that the continued
availability of a damages claim in
law necessarily means that it
constitutes an alternative remedy for the applicant. That is so on
account of the following considerations:
[39.1] As already alluded to supra
when this court dealt with the requirement of irreparable harm, it is
offensive to this court's
sense of justice to find there to exist an
alternative remedy in a premeditated intention or readiness of the
respondent to spend
to engage in wasteful, reckless, and irregular
expenditure of having to pay twice for the same service from the
public purse. I
refuse the invitation by the respondent to this court
to say a clearly unwarranted and possibly unlawful conduct on their
part
of being willing to pay damages to the applicant when same is
avoidable constitutes an alternative remedy. In my view, an
alternative
remedy must have a rational and lawful basis and not be
one mired in possible fiscal irregularity more so to the detriment of
meagre
state resources.
[39.2] Any party has a right to prefer
a particular relief and cannot have a particular relief forced upon
it, more so by its opponent.
The applicant chose to vindicate its
rights arising from the contract by way of seeking specific
performance. That is its choice,
and it is not available to the
respondent to visit a remedy of damages upon the applicant. In the
context of seeking specific performance
whether alive to the
availability of damages or not, it cannot justly be said that a
remedy the applicant does not seek as one
suitable to vindicate its
rights is an alternative. A party cannot be forced to adopt a cause
of action or relief it does not seek
even if it may appear to a court
that that relief is more attractive. What more for an approach which
suggests that an opponent
in litigation can force or direct an
opposing party to go an alternative relief route when a court cannot.
This principle was expounded
on by the apex court in the land in
Baloyi v Public Protector and Others 2022(3) SA 321(CC) at
paragraphs 40 and 42
respectively in the following terms:
"... The following dictum of
the Supreme Court of Appeal in Makhanya, which squarely addressed a
contractual cause of action
in the employment context, is apposite in
this regard: ...when a claimant says that the claim arises from the
infringement of the
common-law right to enforce a contract, then that
is the claim, as a fact. When he or she says that the claim is to
enforce a right
derived from the constitution, then, as a fact, that
is the claim. That the claim might be a bad claim is beside the point
..."
"...a court might be of the
view that a litigant should have pursued a different cause of action,
or that she would have had
a better chance of success had she done so
..."
[39.3] Furthermore, entities like the
applicant do not only benefit monetarily from tenders won such that
damages may be a sufficient
alternative balm. They ordinarily also
seek to establish and grow a brand and to build a resume of work
previously done as a steppingstone
for sustainability in future
endeavors of a commercial lifetime.
[40]
In the premises I find that the applicant does not have an
alternative remedy to the interim
interdict it currently seeks.
[41]
Having thus found that the applicant in casu has satisfied all the
four requisites of an interim
interdict I find the way factually and
legally cleared to grant the applicant that relief.
REGARDING
COSTS
[42]
The applicant has achieved success in this matter and there is thus
no reason to deviate from
the normal course of costs following the
event.
[43]
The applicant had prayed for those costs to be on a punitive scale.
Much as I decried the conduct
of the respondent in acting recklessly
by seeking to advertise a new contract atop another, I am not
persuaded that this is case
for a punitive costs order. This court
has seen far worse conduct more deserving of such a stern frown and
in this matter, I have
not been persuaded in that direction.
[44]
Accordingly costs against the respondent on an ordinary scale should
be on an ordinary scale.
[45]
In the result, I make the following order:
[45.1] Non-compliance with the normal
rules of court is in terms of uniform rule 6(12) is condoned and the
matter is heard on an
urgent basis.
[45.2] The respondent is forthwith
interdicted and restrained from continuing with the public tender
process under Bid/Contract
number 29-2023/2024 for the completion of
the Mabusela and Masoge roads and stormwater project.
[45.3] The order in 45.2 supra shall
operate as an interim interdict, with immediate effect, pending the
finalization of the action
instituted by the applicant against the
respondent on 8 August 2023.
[45.4] The respondent shall pay the
costs of this application on scale B.
MS
MONENE
ACTING
JUDGE OF THE HIGH COURT,
LIMPOPO
DIVISION, POLOKWANE
APPEARANCES
Heard on:
3 May 2024
Judgment delivered on :
07June 2024
For the Applicant:
Adv. A A Basson
Instructed by
Thomas & Swanepoel Attorneys
: Tel: - 015 307 1027
: Email: maryka@tslegal.co.za
For the Respondent:
Adv. J O Williams SC
: Instructed by Ntsako Popela
Maake Attorneys
: Tel: 015 291 3848
: Email:
pcmaake@pmaakeattorneys.co.za