SAFLII Note: Certain personal/private details of parties or witnesses have been redacted from this document
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IN THE HIGH COURT OF SOUTH AFRICA
(EASTERN CAPE DIVISION, MAKHANDA)
Of interest
Case no. 3641/2023
In the matter between:
SKG AFRICA (PTY) LTD Applicant
and
SOUTH AFRICAN First respondent
LOCAL GOVERNMENT ASSOCIATION
STHATHU FUNDING (PTY) LTD Second respondent
___________________________________________________________________
JUDGMENT
___________________________________________________________________
LAING J
[1] This is an application for, inter alia , the review and set ting aside of the
decision of the first respondent (‘SALGA’) to reject the bid submitted by the applicant
(‘SKG’) for the provision of office accommodation in East London . The application
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also seeks to review and set aside the decision to aw ard the tender to the second
respondent (‘Sthathu’).
Background
[2] On 17 November 2022, SALGA advertised the tender, indicating that it was
subject to , inter alia , the provisions of the Preferential Procurement Policy
Framework Act 5 of 2000 (‘PPPFA’) , the Preferential Procurement Regulations ,
2017 , and SALGA’s Supply Chain Management Policy (‘SCMP’) . It stipulated that it
required a minimum of 1100 m² and that the premises should be suitable for a typical
administrative work environment .
[3] To SKG’s query, SALGA confirmed that a bid could include different options
and costs, provided that the distinction was clear. Consequently, SKG submitted two
bids for premises at the Waverly Office Park , each priced at R10 802 113; it also
submitted two bids for premises at the Beacon Bay Crossing , each priced at
R11 134 712.
[4] SALGA informed SKG on 30 May 2023 that its proposal was unsuccessful
and that it had awarded the tender to Sthathu , at a cost of R12 518 992. This
prompted SKG to launch urgent proceedings in terms of the Promotion of Access to
Information Act 2 of 2000 (‘PAIA’) , which culminated , eventually , in the present
matter.
Applicant’s cas e
[5] It was apparent from the record that both SKG and Sthathu achieved the
functionality threshold of 70 points . The Bid Evaluation Committee (‘BEC’) did not ,
however, recommend either party because the terms of reference for the tender
were vague and failed to attract enough bidders ; they also failed to address
occupational health and safety (‘OHS’) concerns . The BEC recommended to the Bid
Adjudication Committee (‘BAC’ ) that the tender be cancelled to address the
shortcomings .
[6] The BAC met on 16 March 2023. It recorded that the BEC ’s recommendation
was inconsistent with the parties’ scores for functionality , both having achiev ed the
70-point threshold . The BAC referred the matter back to the BEC to revisit the
evaluation of the bids, with closer focus on the parties’ respective capacity and
capabilit y, and the location of the premises. Consequently, the BEC met on 17 May
2023 . It revised Sthathu’s functionality score to 88 points , and SKG’s score to 55
points, resulting in the latter’s disqualification. When the BAC met on 29 May 2023,
the chairperson of the BEC explained that the initial recommendation had been
based on the members ’ misunderstanding of how to evaluate and score the bids.
[7] In setting out its grounds for review, SKG relied primarily on the assertion that
the BEC had considered only two of its four bids . These pertained to the premises
situated at Beacon Bay Crossing. SKG referr ed to, inter alia , photographs taken of
the bids that it sub mitted on the closing date, as well as email correspondence and
attendance registers , to allege that the BEC had not only been a ware that SKG had
submitted bids regarding Waverley Office Park but had also inspected the premises
in question on 1 February 202 3. Furthermore, SKG alleged that the BAC had
referred the initial evaluation and recommendations back to the BEC in contravention
of its SCMP. It also alleg ed that the BEC had incorrectly penalised SKG for wrongly
perceived deficiencies in a reference letter ; a misplaced assessment of its capability,
based mainly on cashflow concerns arising from its annual financial statements ; the
failure to include SAPOA certificates when this was not the case ;1 and alleged
shortcomings in the location of the premises despite no reference thereto in the
tender specifications . Overall , SKG contended that there was no correlation between
the scores awarded and the comments made by members of the BEC. It contended,
too, that supply chain management staff had interfered with the BEC’s evaluation of
the bids . The absence , moreover, of the BEC’s initial report and recommend ation at
the BAC meeting on 29 May 2023 meant that more recent members of the BAC had
an incomplete picture of the evaluation that was carried out.
Respondents ’ case
1 A SAPOA certificate is understood as a reference to verification provided by the South African
Property Owners Association regarding the rentable area of a premises.
[8] SALGA did not dispute the sequence of events or broad factual basis upon
which SKG relied. Addressing SKG’s allegation that the BEC had considered only
one of its bids, SALGA stated that it was unaware of any prior communication with its
staff or the circumstances under which S KG submitted four bids. No such
opportunity was provided to Sthathu or any other bidder. The tender documents did
not allow the submission of multiple bids. SALGA admitted that its officials and
SKG’s representatives had inspected the premises at both Wave rley Office Park and
Beacon Bay Crossing, but argued that SKG had effectively submitted one bid , which
the BEC evaluated in accordance with the criteria set out in the tender , viz. capacity,
capability, technical compliance , location, accessibility, and appearance.
[9] The BAC’s referral of the matter back to the BEC was correct , said SALGA;
the provisions of its SCMP obliged the BAC to, inter alia , ensure that the scoring of
bids was done correctly and to refer a recommendation back t o the BEC for
reconsideration when any disagreement in that regard was process related. The
BEC’s initial scoring had been flawed. Its members did not penalise SKG for, inter
alia, the omission of an additional SAPOA certificate , the safety risk posed by having
premises situated next to an informal settlement , the lack of designated parking
bays, and concerns created by a pattern of financial losses for the past three
consecutive years .
[10] Furthermore, asserted SALGA, the fact th at SKG h ad initially achieve d the
functionality threshold of 70 points was inconsequential. This was because the BEC
had recommended that no bidder be appointed .
[11] Sthathu aligned itself with SALGA’s defences but could not dispute that SKG
had submitted two bids for premises at Waverley Office Park and that these had not
been evaluated or adjudicated . It accepted that this g ave rise to an irregularity.
Regarding what would constitute a just and equitable remedy, S thathu emphasized
that it had concluded a five-year lease agreement with SALGA after the award of the
tender on 31 May 2023. The lease pertain ed to premises situated at The Ridge, […]
B[...] Terrace , in relation to which SALGA ha d previously occup ied a portion , but
under different ownership . Sthathu incurred substantial expenses in meeting
SALGA’s requirements for both tenant installation and fit-out,2 amounting to R677
790. Similarly, SALGA incurred expenses for additional tenant installation
requirements that were not contemplated in the tender specifications . These were
calculated as R747 983. Considering the above expenses and the time that had
already elapsed, argued Sthathu, SALGA’s decision to award the tender should
continue to stand. SKG never challenged the validity of Sthathu’s bid.
Issues to be decided
[12] The immediate issue for determination is what to make of SKG’s submission
of multiple bids in response to SALGA’ s tender. Closely allied to this is whether
SALGA properly evaluated and adjudicated such bids, and whether a failure to do so
gave rise to a reviewable irregularity.
[13] To the extent that a ground of review was established under the Promotion of
Administrative Justice Act 3 of 2000 (‘PAJA’) , it will be necessary to decide what
would constitute a just and equitable remedy. Costs must be determined, too. A brief
overview of the relevant principles follows.
Legal framework
[14] The principles governing public procurement are well -known. In terms of
section 217 of the Constitution, when an organ of state contracts for goods or
services, it must do so in accordance with a system that is fair, equitable,
transparent, competitive, and cost -effective . The PPPFA serves as the framework for
the implementation of a procurement policy that provides for categories of
preference in the allocation of contracts, as well as the protection or advancement of
persons disadvantaged by unfair discrimination.3 The Preferential Procurement
2 Sthathu explained that ‘tenant installation’ refers to the process of customizing the interior of a
property in accordance with a tenant’s requirements and preferences for various amenities , fixtures
and systems; ‘fit -out’ refers to the period during which tenant installation occurs .
3 The Public Procurement Act 28 of 2024 repeals the PPPFA but has yet to come into effect.
Regulations , 2017 (made in terms of the PPPFA) were applicable at the time that
SALGA advertised the tender in the present matter .4
[15] It is trite that , in general, decisions made by an organ of state in relation to a
public procurement process are examples of administrative action. These fall within
the ambit of PAJA .5 In terms of section 6(2) thereof, a court is em power ed to review
the disqualification of a bidder or the award of a tender if one or more of the
numerous grounds listed thereunder has been established.
[16] The above principes have been explored in the substantial body of case law
that has emerged with the advent of the constitutional era. The decisions that are
relevant to the present matter will be considered in the paragraphs that follow. At this
stage, i t is necessary to consider the legal position regarding SKG’s submission of
multiple bids, before exploring the consequences of SALGA’s possible failure to have
carried out the proper evaluation and adjudication thereof.
Multiple or alternative bids
[17] SALGA content ed that SKG’s submission of multiple bids was, per se,
unlawful. By implicati on, as the court understands the argument, the failure to
evaluate and adjudicate all the bids did not result in an irregularity that could serve
as a ground of review.
[18] Neither the PPPFA nor the Preferential Procurement Regulations, 2017
addresses the subject of multiple bids. The Public Finance Management Act 1 of
1999 (‘PFMA’) is silent ; there is also no mention of it under the Treasury
Regulations.6 Interestingly, National Treasury’s guidelines for accounting officers
4 The Preferential Procurement Regulations, 2022 came into effect on 16 January 2023, repealing the
earlier regulations mentioned.
5 See Steenkamp NO v Provincial Tender Board, Eastern Cape 2007 (3) SA 121 (CC), para s 20 to
23; Millennium Waste Management (Pty) Ltd v Chairperson, Tender Board: Limpopo Province and
Others 2008 (2) 481 (SCA), para 4.
6 GN R225, published in GG 27388 on 15 March 2005, as amended. As far as can be ascertained,
there are no regulations or instructions issued by National Treasury in terms o f section 76 of the
PFMA that deal directly with the subject of multiple bids.
contemplate the submission of ‘alternative bids’, but reference thereto is made only
in passing.7 SALGA’s SCMP does not deal with the subject.
[19] Bolton, however, comments as follows:
‘It may be possible for an organ of state to reserve the right for itself to
consider alternative or qualified tenders in a tender call. The right to consider
alternative or qualified tenders should, however, be clearly specified by an
organ of state in its call for tenders to ensure compliance with the notions of
fairness, transparency and competitive ness. The submission of a qualified or
alternative tender by a tenderer should also not amount to a tender that is
“substantially” or “materially” different from the tender specifications.’8
[20] There seems to be no reason why, in principle, an organ of state cannot invite
multiple or alternative bids. This would enhance the competitiveness of the tender by
increasing the number of possible solutions for the buyer of the goods or services
required, as well as encourage the overall cost -effectiveness of th e purchase.
Importantly, however, the opportunity to submit multiple or alternative bids must be
clearly communicated and must be made available to all potential bidders to satisfy
the constitutional principles of fairness and transparency. The procuring e ntity must,
furthermore, evaluate and adjudicate each responsive bid without infringing the basic
principles stipulated under section 217 of the Constitution.
[21] Arising from this is the question whether the submission of multiple or
alternative bids wo uld meet the requirements of an ‘acceptable tender’. The term is
defined under section 1 of the PPPFA as:
‘. . . any tender which, in all respects, complies with the specifications and
conditions of tender as set out in the tender document.’
7 National Treasury for Republic of South Africa Supply Chain Management - A Guide for Accounting
Officers / Authorities (2004) at 44. The guide indicates that, at the opening of bids, the name of a
bidder and the total amount of each bid and ‘any alternative bids’ should be read aloud, if requested.
8 P Bolton The Law of Government Procurement in South Africa (2007) at 21 4.
[22] Bolton points out that an alternative bid must not differ substantially or
materially from the tender specifications. Since publication of her seminal work on
the subject , however, there have been significant developments in the case law
regarding what con stitutes an ‘acceptable tender’.9 A flexible and purposive
approach, as reflected in Millennium Waste Management (Pty) Ltd v Chairperson
Tender Board: Limpopo Province and others,10 appears to have yielded to the strict
approach followed in Dr JS Moroka M unicipality and others v Betram (Pty) Ltd and
another.11
[23] In the present matter, SALGA’s SCMP defines a ‘bid’ as follows:
‘. . . a written offer in a prescribed or stipulated form in response to an
invitation by an organ of state for the provision of services, works or goods,
through price quotations, advertised competitive bidding processes or
proposals.’
[24] The definition of an ‘acceptable tender’, as provided in terms of both section 1
of the PPPFA and SALGA’s SCMP, is wide enough, arguably, to en compass a written
offer that comprises multiple or alternative bids, unless expressly prohibited under
the specifications and conditions of the tender in question. It cannot be said, in the
circumstances, that SKG’s submission of multiple bids was unlawful . The issue is
what to make of SALGA’s actions in this regard.
Evaluat ion and adjudicat ion of SKG’s bids
[25] SALGA argued that members of the BEC visited both premises, not only
those situated at Beacon Bay Crossing. Their scoresheets, moreover, indicated as
much ; they referred to ‘properties’, in the plural.
[26] Upon closer inspection , however, a different picture emerges. T here is no
indication from the scoresheets of 17 May 2023 that members distinguished between
9 See the court’s discussion of the matter in Zen JV v Department of Transport, Province of the
Eastern Cape and others 2024 JDR 3696 (ECMk).
10 [2008] 2 All SA 145 (SCA).
11 [2014] 1 All SA 545 (SCA).
SKG’s bids for the premises situated at Waverley Office Park and the premises at
Beacon Bay Crossing. They only considered the latter. A recurring theme that
appears in the comments added to the scoresheets is that the location of the
premises was unsatisfactory . It was situated in a lifestyle centre that was adjacent to
an informal settlement and a constructio n site; members expressed concern about
how this aspect would affect SALGA’s corporate image and the safety of its staff in
the event of ‘riots’ or ‘strikes’, as it was put. This was not a concern that would have
arisen in relation to the premises at Waver ly Office Park, situated entirely elsewhere .
[27] If the BEC had indeed evaluated both premises proposed by SKG, then
separate scores heets with sepa rate point allocations and separate comments would
have been expected. To assert that the scoresheets reflected an evaluation of SKG’s
bid, overall, is simply implausible. It is more likely that the distinction between the
premises was overlooked; alternat ively, the BEC decided, for unknown reason s, that
it would evaluate only the premises located at Beacon Bay Crossing .
[28] The BEC’s report of 17 May 2023 further undermines SALGA’s argument . It
reflects a price of R11 134 712 for SKG’s bid , which refers to the premises at Beacon
Bay Crossing. The report is silent about the price quoted for the premises at
Waverley Office Park . Similarly, the BAC report of 29 May 2023 takes the matter no
further. It refers only to ‘two tender propos als’, indicating that SKG’s proposal was
disqualified for having failed to achieve the functionality threshold of 70 points ,
leaving Sthathu’s proposal as the winning bid . The report ma kes no mention of the
composite nature of SKG ’s submission. The response to SKG’s request for reasons
is also of no assistance. It refer s merely to ‘the bid submitted by SKG’ and to a single
building, clearly the premises at Beacon Bay Crossing .
[29] In its answering papers, SALGA acknowledge d, interestingly, that SKG
submitted multiple bids with two different prices. It said that this contravened the
conditions of the tender and infringed the principle of competi tiveness ; SKG’s
conduct, not SALGA’s, was unlawful . This argument has, however, al ready been
discussed and rejected. SALGA’s position on the issue is self -evidently contradictory .
There can be no doubt, ultimately, that it failed to evaluate and adjudicate , properly,
the four bids that SKG submitted.
Whether SALGA’s conduct gave rise to an illegality
[30] SALGA’s specifications and conditions of tender did not prohibit an offer such
as that submitted by SKG, comprising proposals for premises at both Waverley
Office Park and Beacon Bay Crossing . The difficulty that faces SALGA is how it
responded to SKG’s query about whether it could offer more than one office space at
the same premises . In that regard , SALGA stated:
‘Yes you may — please just make clear mention of the different options and
costings.’
[31] As SALGA admitted in its answering papers, it did not extend the above
communication beyond SKG ; no other bidder was aware that it could submit multiple
bids. SALGA’s conduct undoubtedly infringed the principles of fairness and
transparency. The primary review ground upon which SKG bases its case , however,
is not SALGA’s failure to have notified other bidders about the opportunity to submit
multiple bids but its failure to have evaluated and adjudi cated SKG’s bids in relation
to the premises situated at Waverley Office Park.
[32] In AllPay Consolidated Investment Holdings (Pty) Ltd and others v Chief
Executive Officer, South African Social Security Agency and others ,12 the
Constitutional Court, per Froneman J, held that:
‘. . . To the extent that the judgment of the Supreme Court of Appeal may be
interpreted as suggesting that the public interest in procurement matters
requires greater caution in finding that grounds for judicial review exist in a
given matter, that misapprehension must be dispelled. So too the notion that,
even if proven irregularities exist, the inevitability of a certain outcome is a
factor that should be considered in determining the validity of administrative
action.
12 2014 (1) SA 604 (CC).
. . . This approach to irregularities seems detrimental to important aspects of
the procurement process. First, it undermines the role procedural
requirements play in ensuring even treatment of all bidders. Second, it
overlooks that the purpose of a fair process is t o ensure the best outcome; the
two cannot be severed. On the approach of the Supreme Court of Appeal,
procedural requirements are not considered on their own merits, but instead
through the lens of the final outcome. This conflates the different and separa te
questions of unlawfulness and remedy. If the process leading to the bid’s
success was compromised, it cannot be known with certainty what course the
process might have taken had procedural requirements been properly
observed.’13
[33] SALGA’s conduct regarding the Waverley Office Park bids cannot be
exonerated by arguing that it somehow corrected the initial irregularity of SALGA’s
having failed to notify other bidders that they could submit multiple bids. The
outcome of the tender was far from inevitable . At the very least , the Waverley Office
Park bids were more cost -effective than Sthathu’s.14 Why the BEC overlooked the
former or chose to evaluate only the Beacon Bay Crossing bids is , as previously
noted, simply un known.
[34] The provisions of SALGA’s SCMP require the BEC to evaluate all bids
received in accordance with the criteria specified in the tender documents, including
those pertinent to functionality. This is a core function of the BEC . The requirement s
set out in the SCMP are derived from the provisions of section 2(1) of the PPPFA,15
read with regulation 5 of the Preferential Procurement Regulations, 2017.16 The
purpose thereof is to give effect to the constitutional principles of fairness,
equitability, transparency, competi tiveness, and cost -effectiveness when an organ of
state such as SALGA contracts for goods and services . SALGA’s failure to have
evaluated and adjudicated the Waverley Office Park bids, notwithstanding that they
comprised part of the set of multiple bids th at SKG submitted, amounted to material
13 Paras 23 and 24.
14 The Wave rley Office Park bids were each priced at R10 802 113; Sthathu’s bid was priced at
R12 518 992. The difference is R1 716 879.
15 The provisions in question stipulate that an organ of state must determine its preferential
procurement policy and implement it within the prescribed framework.
16 The regulation requires bids to be evaluated on functionality and indicates how this must be done.
non-compliance with the provisions described above. This gave rise to a further
reviewable (and material) irregularity.
[35] SKG set out, at length, why SALGA’s decision to disqualify its Beacon Bay
Crossing bids was also reviewable and capable of being set aside. Considering the
court’s findings regarding the Waverley Office Park bids, however, there is no need
to explore this aspect further.
[36] Froneman J went on to find in AllPay , in an oft -quoted passage, tha t:
‘. . . Once a ground of review under PAJA has been established there is no
room for shying away from it. Section 172(1)(a) of the Constitution requires
the decision to be declared unlawful. The consequences of the declaration of
unlawfulness must then b e dealt with in a just and equitable order under s
172(1)(b). Section 8 of PAJA gives detailed legislative content to the
Constitution’s “just and equitable” remedy.’17
[37] The court is satisfied that the irregularities relied upon by SKG provide a basis
to declare SALGA’s conduct invalid in terms of section 172(1)( a) of the Constitution.
What would be a just and equitable order in terms of section 172(1)( b) is the
question to which the court must now turn.
Just and equitable order
[38] The remedies avai lable to a court for the determination of a just and equitable
order are described in terms of section 8 of PAJA . In Steenkamp NO v Provincial
Tender Board, Eastern Cape ,18 the Constitutional Court , per Moseneke DCJ, held
that:
‘. . . It goes without saying that every improper performance of an
administrative function would implicate the Constitution and entitle the
aggrieved party to appropriate relief. In each case the remedy must fit the
17 AllPay , n 12, para 25.
18 2007 (3) SA 121 (CC).
injury. The remedy must be fair to those affecte d by it and yet vindicate
effectively the right violated. It must be just and equitable in the light of the
facts, the implicated constitutional principles, if any, and the controlling law. It
is nonetheless appropriate to note that ordinarily a breach of administrative
justice attracts public -law remedies and not private -law remedies. The
purpose of a public -law remedy is to pre -empt or correct or reverse an
improper administrative function. In some instances, the remedy takes the
form of an order to make or not to make a particular decision or an order
declaring rights or an injunction to furnish reasons for an adverse decision.
Ultimately the purpose of a public remedy is to afford the prejudiced party
administrative justice, to advance efficient and effe ctive public administration
compelled by constitutional precepts and at a broader level, to entrench the
rule of law.’19
[39] The learned judge remark ed, further, that section 8 of PAJA confers on a court
a ‘generous jurisdiction’ to make just and equitabl e orders.20 In Bengwenyama
Minerals (Pty) Ltd and others v Genorah Resources (Pty) Ltd and others ,21 the
Constitutional Court , per Froneman J , confirmed the position, observing that:
‘This “generous jurisdiction” in terms of section 8 of PAJA provides for a wide
range of just and equitable remedies, including declaratory orders, orders
setting aside the administrative action, orders directing the administrator to act
in an appropriate manner, and orders prohibiting him or her from acting in a
particular manner.’22
[40] Returning to the present matter, SKG contended that SALGA’s decisions
should be declared unlawful. It did not, however, persist in seeking that the matter be
remitted back to the BEC for reconsideration . Instead, SKG argued that the tender
should be readvertised , using revised criteria where necessary, and that this be done
within a strict timeframe . For its part, SALGA accepted that if the court found against
it then it agreed that a just and equitable order would be for the tender to be
19 Para 29.
20 Para 30.
21 2011 (4) SA 113 (CC).
22 At paragraph [83].
readvertised, but within a more reasonable timeframe ; Sthathu should be allow ed to
remain in occupation, pending the outcome of a fresh tender. This was the same
approach adopted by Sthathu itself during argument.
[41] The question that arises is whether a court can per mit the parties to continue
to benefit from SALGA’s invalid conduct . More specifically, it is necessary to decide
to what extent the existing lease agreement between SALGA an d Sthathu can
remain extant, pending the possible readvertisement of the tender.
[42] In State Information Technology Agency SOC Ltd v Gijima Holdings (Pty)
Ltd,23 the Constitutional Court found that the appellant’s award of a contract
contravened section 217 of the Constitution , and declared it to be invalid.24 The court
held, nevertheless, that justice and equity dictated that the appellant should not
benefit from either the false assurances that it had given to the respondent or the
undue delay in instituting proceedings. Consequently, the court ordered that its
declaration of invalidity would not have the effect of divesting the respondent of
rights to which, but for the declaration, it might have been entitled.25 Shortly
afterwards , in Buffalo City Metropolitan Municipality v Asla Construction (Pty) Ltd ,26
the Constitutional Court adopted the same approach taken in Gijima to declare a
construction contract invalid for the appellant’s failure to have followed a proper
procurement pro cess. Considering , however, that the respondent had already
performed, the court declined to set the contract aside. This was done to preserve
the rights that had already accrued to the respondent in terms thereof , without
permitting it to obtain further rights .27
[43] The same principles apply in the present matter. It was not SKG ’s case that
Sthath u’s bid was non -compliant . Furthermore, it did not dispute that Sthathu
incurred substantial expenses in meeting SALGA’s requirements for both tenant
installation and fit -out. It was common cause , moreover, that SALGA effectively
remained in occupation of the same premises after the expiry of its previous lease,
23 2018 (2) SA 23 (CC).
24 Paras 40, 41, and 52.
25 Paras 53 and 54.
26 2019 (4) SA 331 (CC).
27 Para 105.
with a different landlord, and that it conclud ed a five -year lease with Sthathu with
effect from 1 June 2023. Whereas section 172(1)( a) of the Constitution enjoin s the
court to declare SALGA’s conduct regarding the procurement process invalid, the
above factors are relevant to the determination of a just and equitable order under
section 172(1)( b). It would seem unfair to penalise Sthathu, entirely, for the
consequences of unlawful conduct in which it played no part.
Costs
[44] There was considerable argument about where to attach liability for the costs
of SKG’s urgent application for interim relief, as well as its application to compel
SALGA’s filing of the complete record. SKG abandoned proceedings in both
instances before the matter s were heard.
[45] In Germishuys v Douglas Besproeiingsraad ,28 the court held that , where a
litigant withdraws an action, very sound reasons must exist why the defendant or
respondent should not be entitled to his or her costs. The plaintiff or applicant is in
the same position as an un successful litigant.29 The principle remains, however, that
the court enjoys a wide discretion when awarding costs . In Wildlife and
Environmental Society of South Africa v MEC for Economic Affairs, Env ironment and
Tourism, Eastern Cape, and others ,30 the court observed as follows:
‘. . . even in cases where litigation has been withdrawn , the general rule is of
application, namely, that a successful litigant is entitled to his costs unless the
Court is persuaded , in the exercise of its judicial discretion upon a
consideration of all the facts , that it would be unfair to mulct the unsuccessful
party in costs.’31
[46] In the present matter, SALGA informed SKG on 30 May 2023 that its bid was
unsuccessful. This prompted SKG to request further details on 27 June 2023 ; at the
same time, it enquired whether any lease had been concluded pursuant to the award
28 1973 (3) SA 299 (NC).
29 At 300D –E.
30 2005 (6) SA 123 (E).
31 At 131B –C.
of the tender. SALGA failed to respond satisfactorily, leading to SKG’s instituti on of
proceedings under the provisions of PAIA, which SALGA opposed. On 30 August
2023, SKG requested SALGA to suspend the implementation of the award, pending
a possible challenge. SALGA indicated , on 4 September 2023 , that it wa s preferable
to await the outcome of the application, while confirming that it was, nevertheless,
considering SKG’s request . On 19 September 2023, Beshe J ordered SALGA to
produce the requested information . SKG requested SALGA , again, on 6 October
2023, to suspend implementation . SALGA failed to deal with the request, leading to
SKG’s launching an urgent application for interim relief on 11 October 2023 . It was
only on 31 October 2023, when SALGA delivered its unsigned answering papers,
that SKG discovered that SALGA and Sthathu had already concluded a lease.32 This
resulted in SKG’s withdrawal of the application for interim relief .
[47] The provisions of section 195 (1)(g) of the Constitution stipu late that , within the
context of public administration, transparency must be fostered by providing the
public with timely, accessible , and accurate information. Despite SKG’s clear
requests for information and clarity about whether a lease had been concluded,
SALGA inexplicably refused or failed to disclose the true factual position for more
than three months. Whether this was done to gain a tactical advantage in
anticipation of litigation or otherwise, such a response (or lack of a response) cannot
be justified when weighed against the constitutional principle s involved . An organ of
state must play open cards . The simplest and most direct response would have been
for SALGA to have indicated, immediately, that a lease had been concluded and that
the appropriate information was available. Anything else from an organ of state was
unacceptable.
[48] Considering SALGA’s conduct, it would be unfair to sad dle SKG with th e costs
of its withdrawn application for int erim relief. The order must be framed accordingly.
[49] In relation to the application to compel, SALGA delivered a record on 3
November 2023 . It did not , however, include either a complete set of the applicant’s
bids or the agendas for the meetings of the BEC and BAC. SALGA’s failure to
32 The version appears to contradict Sthathu’s, in terms of which the lease was concluded
considerably earlier, i.e. immediatel y after the award was made on 31 May 2023.
address a subsequent request in this regard led to SKG’s institution of proceedings ,
on 7 December 2023, for delivery of all the bids submitted, the agendas, as well as
the functionality scoresheets for SKG and Sthathu, respectively. On the same date,
SALGA supplemented the record by filing SKG’s bids for Beacon Bay Crossing . SKG
responded a few days later , pointing out tha t SALGA had still not filed the additional
documents requested . It was only late in the afternoon of 1 5 January 2024, the day
before the application was to be argued, that SALGA filed the missing functionality
scoresheets and informed SKG that it never rec eived SKG’s bids for Waverley Office
Park and that there were no copies of the agendas in question.
[50] SALGA’s conduct again fell short of what is expected from an organ of state. If
it had acted with the alacrity , openness, and diligence required by section 195(1)( g),
then SKG’s application to compel would have been entirely unnecessary. Despite
SKG’s withdrawal thereo f, SALGA is not entitled to the recovery of its costs.
Relief and order
[51] As already discussed, nothing prevented SKG from submitting multiple bids.
SALGA’s failure to have afforded such an opportunity to other bidders, however,
gave rise to an irregularity; its failure to have evaluated and adjudicated SKG’s bids
for the premis es at Waverley Office Park gave rise to a further (and material)
irregularity. Consequently, SKG has succeeded in establishing a ground of review in
terms of, inter alia, sections 6(2)( b) 6(2)( e)(iii) of PAJA.33
[52] Turning to what would constitute a just and equitable order, SALGA’s conduct
must be declared unlawful, and the tender must be readvertised, using revised
specifications and conditions where necessary. This must be done within a specified
timeframe. Since SALGA already has a set of specificatio ns and conditions to serve
as a point of reference, the timeframe need not be as generous as the period sought
by SALGA in argument. It would not be just and equitable, howe ver, for the lease
agreement to be set aside, pending the conclusion of the fresh t ender.
33 Section 6(2)( b) provides for a situation where a mandatory and material procedure or condition
prescribed by an empowering provision is not complied with; section 6(2)(e)(iii) addresses a situation
where the action was taken because irrelevant considerations were taken into account or relevant
considerations were not considered.
[53] The determination of costs has already been discussion in relation to SKG’s
urgent application for interim relief and its application to compel. There is no reason
why the general rule should not apply regarding the present application.
[54] The following order is made:
(a) the first respondent’s failure to evaluate and adjudicate the applicant’s bids
for Phases 6A and 3 of the premises situated at Waverley Office Park,
submitted in response to the tender advertised for the provision of
accommodati on in East London for the first respondent’s Eastern Cape
office (SALGA/20/2022), is reviewed and set aside;
(b) the first respondent’s award of the tender and subsequent conclusion of a
lease agreement with the second respondent are reviewed and set aside;
(c) the matter is referred to the first respondent for the commencement of a
new procurement process regarding the provision of accommodation in
East London for its Eastern Cape office, to be completed within six (6)
months of the date of this order;
(d) the order described in paragraphs (a) and (b), above, is suspended until
the tender envisaged under paragraph (c) has been awarded or until the
expiry of the six (6) months referred to, whichever is sooner;
(e) in relation to costs:
(i) each party shall pay its own costs regarding the application for
urgent interim relief, set out in part A of the applicant’s notice of
motion;
(ii) each party shall pay its own costs regarding the applicant’s
application to compel the filing of the record; and
(iii) the respondents are o rdered to pay the costs regarding part B of
the applicant’s notice of motion, on scale B (under rule 69(7), read
with rule 67A(3), of the URC), being jointly and severally liable.
_________________________
JGA LAING
JUDGE OF THE HIGH COURT
APPEARANCES
For the applicant: Adv S Sephton
Instructed by: HUXTABLE ATTORNEYS
26 New Street
Makhanda
Tel: 046 622 2961
Email: owen@huxattorneys.co.za
Ref: Mr O Huxtable
For the first respondent: Adv T Tshavhungwa
Instructed by: MABENTSELA AND ASSOCIATES
Office no. 2
Eskom Building
110 High Street
Makhanda
Tel: 010 312 5772
Email: azwi@khamphainc.co.za
Ref: AK/SALGA -SKG -AFRIKA/2023
For the second respondent: Adv K Watt
Instructed by: DE JAGER & LORDAN INC
2 Allen Street
Makhanda
Tel: 046 622 2799
Email: stuart@djlaw.co.za
Ref: Mr S Tarr
Date heard: 27 February 2025
Date delivered: 19 June 2025