THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT

Reportable
Case no: 590/2024
In the matter between:

MAFOKO SECURITY PATROLS (PTY) LTD FIRST APPELLANT
MAFOKO SECURITY SUPPLIES (PTY) LTD SECOND APPELLANT
MAFOKO SECURITY SERVICES (PTY) LTD THIRD APPELLANT

and

MJAYELI SECURITY (PTY) LTD FIRST RESPONDENT
SPECIAL INVESTIGATION UNIT SECOND RESPONDENT
THE SOUTH AFRICAN BROADCASTING
CORPORATION SOC LIMITED THIRD RESPONDENT
KHANYISILE KWEYAMA FOURTH RESPONDENT
MATHATHA TSEDU FIFTH RESPONDENT
FEBBE POTGIETER-GQUBULE SIXTH RESPONDENT
JOHAN MATISSON SEVENTH RESPONDENT
PRESIDENT OF SOUTH AFRICA EIGHTH RESPONDENT

Neutral citation: Mafoko Security Patrols (Pty) Ltd and Others v Mjayeli
Security (Pty) Ltd and Others (590/2024) [2025] ZASCA 179
(28 November 2025)
Coram: ZONDI DP and SMITH and UNTERHALTER JJA and BASSON and
KUBUSHI AJJA

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Heard: 7 November 2025
Delivered: 28 November 2025
Summary: Tender – invalidity – remedy – s 172(1)(a) and (b) of the Constitution
– just and equitable remedy – unlawful award – tenderer continues to provide the
service – application of the no profit no benefit principle.


ORDER

On appeal from: Gauteng Division of the High Court, Johannesburg (Dosio J,
sitting as the court of first instance):
1 The appeal is upheld.
2 The order of the high court is set aside.
3 The second respondent is ordered to pay the costs of the appeal, including
the costs of two counsel, where so employed.
4 The matter is remitted to the high court for the high court to determine the
orders it should make in terms of s 172(1) (a) and (b) of the Constitution, after
securing such production of evidence from the parties as the high court considers
warranted and inviting further submissions from the parties.
5 The costs of the proceedings before the high court, save in respect of the
order made concerning the fifth to the eighth respondents, are reserved for
determination by the high court when it renders its judgment on remedy.

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JUDGMENT

Unterhalter JA ( Zondi DP and Smith JA and Basson and Kubushi AJJA
concurring):

Introduction
[1] The first appellant, Mafoko Security Patrols (Pty) Ltd (Mafoko), was on 30
June 2017 awarded a tender by the third respondent, the South African
Broadcasting Corporation Soc Ltd (the SABC) , to provide security services. The
award was made by the interim board of the SABC. It took this decision , even
though the Bid Adjudication Committee and the Group Executive Committee of
the SABC had recommended that the tender should be awarded to the first
respondent, Mjayeli Security (Pty) Ltd (Mjayeli). This recommend ation followed
the evaluation of Mjayeli as the qualifying bidder that scored highest on price and
empowerment.

[2] On 7 December 2017, Mjayeli brought an application to review and set aside
the award of the tender to Mafoko. On 1 March 20 18, the SABC requ ested the
second respondent, the Special Investigation Unit (SIU) , to investigate the award
of the tender. The SABC then brought an application on 19 March 2018 to suspend
Mjayeli’s review pending the outcome of the SIU investigation. In that application,
the SABC also sought an order that Mafoko would continue to render the security
services that were contemplated in t he award of the tender. Neither Mjayeli nor
Mafoko opposed the application.

[3] On 7 May 2018, the Gauteng Division of the High Court, Johannesburg (the
high court) granted the orders sought by the SABC. Of importance, the high court
ordered, in relevant part, that Mafoko ‘will continue to carry out the services

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contemplated in the tender, relating to providing security services . . . pending the
finalisation of the SIU’s investigation or the setting aside of the award . . .’. I shall
refer to this order as the continuation order.

[4] Under Presidential proclamation, the SIU was appointed to investigate the
award of the tender to Mafoko. It did so and rendered a report on 30 June 2019.
The SIU found that the decision of the interim board of the SABC to award the
tender amounted to financial mismanagement and referred th e matter to the
National Prosecuting Authority. The SIU also supported the relief sought by
Mjayeli in its review, which remained pending before the high court. M jayeli did
not take steps to pursue its review. The SIU, aft er some considerable time, then
applied to intervene in the review as an applicant. The high court granted this order
on 14 July 2020.

[5] On 19 December 2020, the SIU filed its founding affidavit, seeking to set
aside the award of the tender, but resisting Mjayeli’s proposed relief of substitution.
In its answering affidavit, Mafoko averred that it was an innocent tenderer; that the
SABC had received value for money ; and that it had performed the services
required of it. All this in support of its contention that the award of the tender
should not be set aside. In its replying affidavit, the SIU sought to amend its notice
of motion. In addition to the relief already sought (to review and set aside the award
of the tender), the SIU sought an order that: (i) Mafoko file an audited statement of
the expenses incurred by it in the performance of its obligations under the contract,
the income received, and its net profits; (ii) that the SABC obtain and file an
independent audited verification of Mofoko’s statement; and (iii) that the high
court then determine the amount of profit to be paid back by Mafoko to the SABC
or the SIU. I will refer to this relief as the SIU disgorgement relief.

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[6] The application , that was opposed by Mafoko and the members of the
interim board of the SABC, was heard by the high court. The high court found that
the interim board of the SABC had acted unlawfully and that this amounted to
financial misconduct in terms of s 83 of the Public Finance Management Act 1 of
1999 (PFMA). There was no basis to have awar ded the tender to Mafoko, as the
incumbent provider, in preference to Mjayeli which had the higher score, and
offered a lower price, the difference being some R2 300 955,43. The h igh court
then proceeded to consider the question of remedy. It recognised that apart from
the required declaration of unlawfulness, the high court enjoyed a discretion to
fashion a just and equitable remedy. The high court considered the learning of our
courts as to the nature of this discretion. It concluded that Mafoko was an innocent
party and had performed the work with which it was charged. The private interests
of Mafoko, however, could not outweigh the public good. As a result, although
Mafoko should not suffer loss, ‘ . . . it should also not profit at the expense of the
public purse’. The high court made the following order: it set aside the decision of
the SABC to award the tender to Mafoko; it granted the SIU disgorgement relief;
and ordered Mafoko to pay the costs.

[7] With the leave of the high court, Mafoko now appeals to this Court. Mafoko
does not appeal the finding of the high court that the award of the tender was
unlawful. Its appeal is confined to the question of remedy. Mafoko contends that
the high court erred in making the orders it did to set aside the award of the tender
and grant the SIU disgorgement order. The high court, Mafoko submitted,
misconceived the basis of the just and equitable discretion enjoyed by it, and should
simply have declared the award of the tender unlawful, dismissed the SIU
disgorgement order, and ordered the SIU to pay Mofoko’s costs.

disgorgement order, and ordered the SIU to pay Mofoko’s costs.

[8] I should indicate that neither the SABC, nor its interim board members, nor
Mjayeli, took part in this appeal. And although two Mafoko companies remained

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nominal appellants (second and third appellants), it was made plain in the
answering affidavit of Mafoko that it alone was awarded the tender and engages in
the litigation that has ensued.

The test for appellate intervention
[9] The parties were in agreement that the standard that must be met for an
appellate court to interfere with the exercise by the high court of its discretion to
fashion a just and equitable remedy in judicial review proceeding s is the standard
affirmed in Trencon.1 Mafoko’s appeal rests upon the proposition that the high
court’s remedial order is predicated upon an error of law. If that complaint can be
made out, then, following Trencon, that would provide a basis for this Court’s
intervention. The central question that thus arises in this appeal is whether the high
court’s appreciation of its just and equitable remedial discretion was vitiated by
any error of law.

Did the high court make an error of law?
[10] There can be little doubt that the high court, citing the Constitutional Court
decisions in Steenkamp NO2 and Gijima,3 understood its discretion to be wide. The
high court framed the discretion thus: ‘The remedy must be fair to those affected
by it and yet vindicate effectively the right violated’ . I can find no fault with this
general formulation.

[11] The high court, rightly, then sought to engage the important dicta in Allpay
II4 that engaged the question as to the remedial discretion that a court enjoys under

1 Trencon Construction (Pty) Limited v Industrial Development Corporation of South Africa Limited and Another
[2015] ZACC 22; 2015 (5) SA 245 (CC); 2015 (10) BCLR 1199 (CC) para 88.
2 Steenkamp NO v Provincial Tender Board of the Eastern Cape [2006] ZACC 16; 2007 (3) SA 121 (CC); 2007 (3)
BCLR 300 (CC) para 29.
3 State Information Technology Agency SOC Limited v Gijima Holdings (Pty) Limited [2017] ZACC 40; 2018 (2)
BCLR 240 (CC); 2018 (2) SA 23 (CC) para 53.

BCLR 240 (CC); 2018 (2) SA 23 (CC) para 53.
4 Allpay Consolidated Investment Holdings (Pty) Ltd and Others v Chief Executive Officer of the South African
Social Security Agency and Others [2014] ZACC 12; 2014 (6) BCLR 641 (CC); 2014 (4) SA 179 (CC).

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s 172(1)(b) of the Constitution, once the court has declared the award of a tender
to be invalid pursuant to its duty to do so in terms of s 172(1) (a). In Allpay II, the
Constitutional Court had to grapple with the problem that if its declaration of
invalidity was not suspended, the company awarded the contract pursuant to the
invalid tender (Cash Paymaster) could simply walk away, leaving welfare
recipients without a means of securing payment, until a lawful tender process had
been concluded. The Constitutional Court found that Cash Paymaster continued to
bear constitutional obligations to ensure a payment system remained in place until
a new provider was lawfully appointed and had become operational.5 In the context
of this exposition, the Constitutional Court said this: ‘It is true that any invalidation
of the existing contract as a result of the invalid tender should not result in any loss
to Cash Paymaster. The converse, however, is also true. It has no right to benefit
from an unlawful contract. And any benefit that it may derive should not be beyond
public scrutiny’6. I shall, for convenience, call this the two-truths dictum.

[12] The two-truths dictum has given rise to a body of judicial interpretation. This
learning has been set out in the decision of this Court in Phomella,7 and need not
be repeated here. Put at its most stark, these cases understand the two-truths dictum
to enunciate a principle that even an innocent tenderer should not benefit from the
proceeds of an invalid contract. Thus, while an innocent tenderer cannot be
required to suffer a loss, if it is required to continue to perform under a contract
that has been found invalid, such a tenderer cannot profit thereby. Simply put, the
principle is this: no loss, but no gain.

[13] In Phomella, this Court explained that the principle of no loss, but no gain,
does not correctly reflect the position adopted in Allpay II, nor is it consistent with

5 Ibid para 66.
6 Ibid para 67.

5 Ibid para 66.
6 Ibid para 67.
7 Special Investigating Unit v Phomella Property Investments (Pty) Ltd and Another [2023] ZASCA 45; 2023 (5)
SA 601 (SCA) paras 14-16.

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the remedial latitude the Constitutional Court has applied in other cases in which
it has made a just and equitable order. Regrettably, Phomella was not cited before
the high court. Phomella’s interpretation of Allpay II is correct. Allpay II held that
the award of a tender found to be unlawful and declared invalid does not give rise
to a right to benefit from an unlawful contract. What this means is simply this :
without a right, there is no duty resting upon a court exercising its just and equitable
discretion to order that the benefit of the unlawful contract must be conferred. But
the absence of such a right and its correlative duty does not mean that the court in
the exercise of its discretion may not permit a party to enjoy the benefit of a
contract, including the profits that may accrue.

[14] The mistake made by certain courts that have sought to understand Allpay II
is to equate the absence of a right to benefit from an unlawful contract with the
exclusion of such benefit from the exercise by the court of its just and equitable
discretion. Allpay II does not say this. Indeed, it simply holds that any benefit
derived ‘should not be beyond public scrutiny’. This means that any benefit derived
from an unlawful contract falls to be scrutinised in order to determine how the court
should exercise its just and equitable discretion. It does not mean that the benefit
of an unlawful contract is excluded from remedial consideration, for then the
benefit would indeed be beyond public sc rutiny because it would fall outside the
very exercise the court undertakes to weigh relevant considerations so as to arrive
at a just and equitable order.

[15] The exclusion of benefit, and more particularly profit, from remedial
consideration could also have perverse and undesirable consequences. The conduct
of a person awarded a tender that is found to be unlawful falls within a spectrum
of culpability. Such a person may be complicit in the unlawful conduct or innocent

of culpability. Such a person may be complicit in the unlawful conduct or innocent
of it, with degrees of turpitude or blamelessness between these polarities.

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[16] The position of Mafoko raises these very issues. Neither the SIU nor the high
court found there to be any culpability on the part of Mafoko in the award of the
tender. Mafoko was the incumbent security provider and continued to provide this
service to the SABC after the award of the tender. No criticism is offered of its
performance. No party sought to interdict Mafoko from continuing to render
services to the SABC. On the contrary, the SABC sought and secured the
continuation order requiring Mafoko to continue providing security services.

[17] Without making a finding on this issue, it seems plain that Mafoko is
positioned on the blameless end of the spectrum. Given this, there is no issue of
principle that exclude s consideration of whether it should be permitted to profit
from the service it has rendered. While the award of the tender was found by the
high court to have been unlawful, the litigation that ensued was engaged over such
a lengthy period, that, by the time the high court rendered its judgment, in October
2023, the contract period secured by the tender had long since come to an end.

[18] Mafoko thus rendered its services over a lengthy period of time, and under
compulsion of the continuation order. Whether that order was justified in virtue of
a constitutional duty owed by Mafoko did not need to be determined by the court
that gave the order. It may be that Mafoko, as the incumbent service provider, owed
a constitutional duty to continue to provide its services to the SABC. The content
and duration of that duty require careful consideration. F or how long and under
what conditions should a service provider be required to render service? These are
among the important matters that need to be considered in the exercise by a court
of its power to fashion a just and equitable remedy.

[19] Where a firm is awarded a tender that is found to be unlawful, it may be
necessary, as the case law demonstrates, for this firm to continue to render services

necessary, as the case law demonstrates, for this firm to continue to render services
until a lawful tender process yields a new award. The rendering of that service is a

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public service, as Allpay II has made plain. But at what cost? Lawful public
procurement is secured by the state at a competitive price, which includes a return
(or profit) for the provider. That is the normative benchmark. Indeed, without a
return for the provider, the state would not be able to engage in public procurement.
Does the rendering of public goods or services occasioned by an unlawful award
oust a blameless provider, saddled with the duty to provide these goods or services,
from enjoying any profit? I think not , because in circumstances where a provider
is entirely blameless for the unlawful award, the imposition of a duty to provide
public goods or services (and hence contribute to the public good) should be
influenced by the normative benchmark of application to the award of a lawful
tender. That is to say, at a competitive price. O f course, whether a tenderer is
entirely blameless; whether the tenderer has enjoyed the considerable past benefits
of incumbency; and what might be a reasonable return under the discipline of
competitive rivalry are all matters to be properly considered i n the exercise of the
court’s discretion to make a just and equitable order . The salient point is that the
exercise of that discretion cannot be understood to be repugnant to the enjoyment
of profit in every circumstance where a tenderer has continued to render a service
or provide goods. There are circumstances in which a firm that secures the public
good is entitled to accrue a private return . Nothing in Allpay II precludes such
consideration in an appropriate case.

[20] It was submitted by counsel for the SIU that even though strict adherence to
the principle of no loss, but no gain may not be warranted, it should nevertheless
be the presumptive principle governing the exercise of the court’s remedial
discretion. This submission was predicated upon the observation that the corruption
that pervades our system of public procurement may not always be evident, and

that pervades our system of public procurement may not always be evident, and
hence it would be prudent to proceed on the premise that a tenderer should gain no
profit from a contract declared unlawful. Such a presumption may then be rebutted
by the tenderer seeking to secure a profit by way of judicial remedial discretion.

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This presumptive construction of the discretion has some merit, given the dismal
parade of corrupted tenders that come before the courts. But I consider the just and
equitable discretion is better conceived as the Constitution intended, without
preconception as to depravity that has befallen its promise. This said, once there is
evidence that a tenderer is not blameless, or worse, actively complicit in the
illegality that has rendered the award of the tender invalid, then courts will be astute
to apply the age-old maxim that such a tenderer cannot profit from its own
wrongdoing.

[21] I turn next, in the light of this exposition of the law, to consider whether the
high court exercised its discretion to determine a just and equitable remedy under
a misapprehension of law. The high court’s understanding of Allpay II was plainly
influenced by the series of decisions that adhered to the no loss, but no gain
principle. The high court considered these decisions to be correctly decided. They
were not, as Phomella decided, and I affirm.

[22] That this error of law was an operative error is made manifest in the manner
by which the high court exercised its discretion. It considered the public good to
be something opposed to the private interests of Mafoko, and that the public good
enjoys such paramountcy that ‘Mafoko’s interests cannot outweigh the priority to
be given to the public good’ . The high court ultimately decided that ‘[ a]lthough
Mafoko should not suffer a loss, it should also not profit at the expense of the public
purse’. And concluded as follows: ‘Applying the decision of Allpay [II] and Vision
View Productions8 to the matter in casu and due to the fact that this Court has made
a finding that the contract is unlawful, this Court orders that Mafoko has no
entitlement to keep the profits’ . For these reasons the high court ultimately made
an order requiring Mafoko to disgorge any profits it might have made.

an order requiring Mafoko to disgorge any profits it might have made.

8 Special Investigating Unit and Another v Vision View Productions CC [2020] ZAGPJHC 421; [2020] JOL 53649
(GJ).

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[23] The high court laboured under an error of law derived from its adherence to
the principle of no loss, but no gain. This adherence pervades the reasoning of the
high court and resulted in the following errors. First, that the award of the tender
is found to be unlawful does not oust from consideration whether a blameless
tenderer that is required to continue to render a service to the state cannot enjoy
any profit. Second, private gain is not, for all purposes, opposed to the public good.
It may be a means to securing the public good in the context of public procurement.
Third, and in consequence, the paramountcy of the public good does not exclude
the possibility that the recognition of a profit may be warranted.

[24] For these reasons, I find that the high court made an error of law that vitiated
the exercise of its discretion to decide upon a just and equitable remedy. That
conclusion, under the holding in Trencon, permits this Court to interfere with the
orders made by high court as to remedy.

Remedy
[25] The high court gave the following order:
‘1. That the decision of the first respondent of 30 June 2017 to award a tender to the second
respondent alternatively, and/or the third respondent further alternatively, and/or the third
respondent is reviewed and set aside.
2. That the second respondent, alternatively the third respondent, further alternatively the
fourth respondent be ordered to:
2.1 File with this Court, within 30 days of the Court order, an audited statement of the
expenses incurred in the performance of its obligations in terms of the tender (contract), the
income received and the net profit it would have earned at the expiry of the contract.
2.2 The SABC must within 60 days thereafter obtain an independent audited verification with
the above Honourable Court.
2.3 The Court will thereafter determine the amount of profits to be paid back by Mafoko to
the SABC or the SIU.

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3. That the time period provided for in Rule 6(5)(d) of the Uniform Rules of Court for which
the second applicant requests the respondent’s respective notices of intention to oppose and the
answering affidavits be dispensed with.
4. In respect to the first, second, third and fourth respondents, costs will follow the result.
In respect of the fifth to the eighth respondents no order will be made as to costs.’

[26] This order cannot stand. First, there was no reason to set aside the award of
the tender. The tender had run its course and the SABC had received the services
rendered by M afoko. The delay that occurred in bringing this matter to finality
before the high court, without even engaging upon the question of culpability, is a
matter that must be taken into account as to what remedy is of practical value. The
only question that remained, given the passage of time, was what of the
remuneration enjoyed by Mofo ko, should Mafoko be permitted to retain (the
retention issue). The high court should , firstly, have made an order in terms of s
172(1)(a) of the Constitution declaring the award of the tender to be invalid , and
then considered what remedy is appropriate to the determination of the retention
issue. Second, the order is predicated upon a determination that once the audited
statements of expenses and nett profit have been provided and verified, Mafoko is
required to pay back its profits. That order follows from the high court’s faulty
understanding of the law. What is required is an exercise of the court’s discretion
that will result in a just and equitable order. Such an order cannot proceed from the
a priori position that what is just and equitable excludes the retention of any profit
by Mafoko.

[27] Mafoko submitted that setting aside the award of the tender and the
repayment of the profits by Mafoko is neither just nor equitable. It contended that
Mafoko was an innocent tenderer, and it should be permitted to enjoy the benefit

Mafoko was an innocent tenderer, and it should be permitted to enjoy the benefit
of the contract it had fully performed. Hence, the high court should simply have

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declared the award of the tender unlawful . Counsel for M afoko invited us to set
aside the high court order and to make such an order.

[28] I do not consider that to be the correct order that the high court should have
made. As I have indicated, to make an order that is just and equitable , in the
circumstances of this case, requires the consideration of a number of matters. Was
Mafoko entirely blameless for the unlawful award of the tender to it? Did its
incumbency as a service provider burden it with constitutional duties to continue
to provide the service? If so, what is the content of that duty and for how long
should it have endured? What b enefits and burdens accrued to the SABC and
Mafoko in the performance of the services rendered by M afoko? What profit did
Mafoko enjoy? How closely did any such profit conform to a normal return for a
firm in a competitive market for security service s? Was such a return necessary
and deserved, given the period over which Mafoko rendered its services? I do not
suggest that all of these questions must be answered to make a just and equitable
order, nor that these questions are exhaustive of the issues that may be relevant.
What these questions do demonstrate is that a just and eq uitable order is not a
binary choice between Mafoko retaining all the profits it may have made or being
required to disgorge its profits. Just ice and equity are capacious concept s. Its
boundaries may be uncertain, but it is designed to render a nuanced judgment as to
what order will be just and equitable. Such an order was not rendered by the high
court, but, at the same time, an order that simply permits Mafoko to retain its profits
would amount to an order made in advance of answering some central questions
that need to be posed.

[29] This court cannot , on the record before it , determine a just and equitable
order. The matter must accordingly be remitted to the high court so that it can

order. The matter must accordingly be remitted to the high court so that it can
reengage the parties to determine a just and equitable order, properly informed by
relevant evidence and argument which the court may need to secure. As to the costs

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of this appeal, these must follow the success of Mafoko in overturning the remedial
order of the high court.

[30] In the result, the following order is made:
1 The appeal is upheld.
2 The order of the high court is set aside.
3 The second respondent is ordered to pay the costs of the appeal, including
the costs of two counsel, where so employed.
4 The matter is remitted to the high court for the high court to determine the
orders it should make in terms of s 172(1) (a) and (b) of the Constitution, after
securing such production of evidence from the parties as the high court considers
warranted and inviting further submissions from the parties.
5 The costs of the proceedings before the high court, save in respect of the
order made concerning the fifth to the eighth respondents, are reserved for
determination by the high court when it renders its judgment on remedy.



______________________
D N UNTERHALTER
JUDGE OF APPEAL

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Appearances

For the appellants: A B Bishop
Instructed by: Victor Nkhwashu Attorneys Inc., Johannesburg
Symington De Kok Attorneys, Bloemfontein

For the second respondent: J A Motepe SC (with him T Moretlwe)
Instructed by: Werksmans Attorneys, Johannesburg
Lovius Block Attorneys, Bloemfontein.