About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: North Gauteng High Court, Pretoria
You are here:
SAFLII
>>
Databases
>>
South Africa: North Gauteng High Court, Pretoria
>>
2026
>>
[2026] ZAGPPHC 981
|
Noteup
|
LawCite
Appcentrix (Pty) Ltd v Minister of Police (2025-174404) [2026] ZAGPPHC 981 (27 August 2026)
Download original files
PDF format
RTF format
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG DIVISION,
PRETORIA
Case number:
2025-174404
Date
of hearing: 6 August 2026
Date delivered: 27
August 2026
(1)
REPORTABLE:
YES
/NO
(2)
OF INTEREST
TO OTHERS JUDGES:
YES
/NO
(3)
REVISED
DATE
27/8/26
SIGNATURE
In the application of:
APPCENTRIX
(PTY)
LTD
Applicant
and
THE
MINISTER OF
POLICE
Respondent
JUDGMENT
SWANEPOEL J:
[1]
The applicant seeks an urgent order that the respondent must assign a
purchase order
for services which have been, or are to be rendered by
the applicant, for and on behalf of the respondent, during the period
of
1 March 2026 to 28 February 2027.
[2]
The common cause facts are the following:
[2.1]
During 2021 the applicant successfully bid for a contract for the
provision of monitoring
services, for the establishment of a National
IS/ICT Operations Centre, and for the provision of maintenance and
support (“the
services”), for a period of five years.
[2.2]
On 17 August 2023 the parties entered into an agreement in terms of
which the applicant
undertook to render the services, and the
respondent undertook to pay for the services within 30 days of
receipt of an invoice
accompanied by a delivery note.
[2.3]
The total contract price was R 549 789 000.
[2.4]
On 21 January 2026 the parties entered into a Master Service
Agreement (“MSA”)
in terms of which the effective date
for the agreement was recorded to be 1 May 2024, and it also recorded
that the MSA would continue
until 30 April 2029.
[3]
The respondent has authorized various purchase orders as the project
unfolded, for
implementation services, infrastructure deployment,
software licensing, architecture and commissioning and latterly for
maintenance
and support. Since March 2026 the applicant has not
received any purchase orders. Nonetheless, the applicant has
continued to provide
continuous monitoring of the police’s ICT
environment, has maintained the monitoring platform, has provided
operational reporting,
incident management services, and platform and
technical support. It continues to do so.
[4]
On 31 March 2026, 30 April 2026 and 31 May 2026 respectively the
applicant issued
invoices for services rendered in those months. The
respondent has refused to effect payment of those invoices, amounting
to R
32 976 385.64 (the average cost per month is R
8 244 096.41) and has refused to issue purchase orders.
[5]
The respondent has pleaded, in limine, that the applicant was obliged
in terms of
the MSA to approach a mediator to attempt to resolve the
dispute between the parties. Secondly, the respondent says that an
investigation
into “identified” procurement
irregularities is underway, and that the claim for payment is
premature. The respondent
says that it is currently not ascertainable
whether the applicant is entitled to payment or not. If it is found
later, that payment
was not due, the such payment will, the
respondent says, amount to wasteful and fruitless expenditure.
[6]
The respondent has also attacked the alleged lack of urgency of the
application.
Mediation
and prematurity
[7]
The respondent relies on clause 21.1 and 21.2 of the MSA which reads:
“
21.1
If any dispute or difference of any kind whatsoever arises between
the purchaser and the supplier in connection
with or arising out of
the contract, the parties shall make every effort to resolve amicably
such dispute or difference by mutual
consultation.
21.2
If, after thirty (30) days, the parties have failed to resolve their
dispute or difference by mutual
consultation, then either the
purchaser or the supplier may give notice to the other party of his
intention to commence with mediation.
No mediation in respect of this
matter may be commenced unless such notice is given to the other
party.”
[8]
The respondent does not seek a stay of the proceedings. It pleads the
alternate dispute
resolution clause as a complete defence to the
application. It says that it is only when mediation has failed, that
a dispute may
be referred to a court. Alternate Dispute Resolution
mechanisms are of much value in commercial matters. It allows
contracting
parties to agree on their preferred method of resolving
disputes, whether by adjudication by an expert, mediation by a
trained
mediator, or by an arbitrator in accordance the
Arbitration
Act, 1965
. The parties are allowed to resolve their disputes in the
manner that they choose, speedily and efficiently.
[9]
However, alternate dispute resolution is not in all instances the
best manner in which
to resolve conflicts that may arise in the
course of a contract. For that reason, a court is never divested of
jurisdiction to
entertain any dispute that would normally fall within
its jurisdiction. However, there must be a dispute that is capable of
resolution
by alternate dispute resolution. In
Parekh
v
Shah Jehan Cinemas (Pty) Ltd and Others
[1]
the Court held (per Didcott J) the following:
“
Arbitration
is a method for resolving disputes. That alone is its object, and its
justification. A disputed claim is sent to arbitration
so that the
dispute which it involves may be determined. No purpose can be
served, on the other hand, by arbitration on an undisputed
claim.
There is then nothing for the arbitrator to decide.”
[10]
In
Telecall
(Pty) Ltd v Logan
[2]
the court said:
[12]
I conclude that before there can be a reference to arbitration a
dispute, which is a dispute capable of formulation at the time when
the arbitrator is to be appointed, must exist and there can
not be an
arbitration and therefore no appointment of an arbitrator in the
absence of such a dispute.”
[11]
I accept that mediation proceedings may encompass issues that are
broader than strictly legal questions
which may justify arbitration
or court proceedings. However, as much as a court is not constrained
from determining a dispute where
the parties have agreed to arbitrate
a dispute, it is also not constrained from hearing a dispute where a
mediation has been agreed
upon.
[12]
Moreover, clause 21.1 requires the parties to mediate, when there is
“
any dispute or difference of any kind whatsoever [arising]
between the purchaser and supplier in connection with or arising out
of the contract…”
[13]
Is there a dispute arising from or in connection with the contract?
The respondent says that during
March 2026 information surfaced
regarding possible procurement irregularities involving the contract
and the MSA. Due to the paucity
of the averments, the Court is left
in the dark as to the nature of the possible irregularities. We are,
however, told that the
investigation relates to a contract between
Telkom/BCX and the police in which the applicant was a subcontractor
to Telkom/BCX.
The irregularities apparently relate to the
applicant’s appointment in this contract in the face of the
“damning’
outcome of the Telkom/BCX contract.
[14]
Firstly, there is no dispute arising from or in connection with this
contract. The respondent is clearly
happy with the services rendered
by the applicant, and is also quite content to continue to receive
the services whilst at the
same time refusing to pay what it owes.
[15]
In my view, there is no dispute that is capable of mediation. In
addition, the so-called dispute apparently
relates to
‘irregularities’ in a contract to which the applicant was
not a party. Finally, any dispute in regard to
the Telkom/BCX
contract would require the latter’s involvement in the dispute
resolution process. Telkom/BCX is not a party
to the mediation
agreement, and mediation would thus be futile.
[16]
The aforesaid is dispositive of the mediation defence. As for the
‘premature’ defence,
it is not a defence to say that a
party is investigating whether it owes money or not, and that the
proceedings can wait until
it has made up its mind on that score. The
notion that this is a defence is unfounded.
Urgency
[17]
The respondent says that the applicant’s urgency is
self-created. It alleges that the process
of issuing a new purchase
order had commenced in February 2026, during discussions between the
applicant and one Col. Tungwana.
At that stage, it says, it must have
been obvious to the applicant that new purchase orders would not be
authorized.
[18]
On 26 May 2026 the applicant formally demanded that a purchase order
be issued within 10 days, failing
which an urgent application would
be launched. A further letter of demand was sent on 19 June 2026,
again on 8 July 2026 and finally
on 16 July 2026. This application
was launched on 22 July 2026.
[19]
To say that the applicant took its time in launching this application
would be charitable. It knew
for months that there was a problem with
the issuing of a new purchase order. It is quite apparent from the
tone of its correspondence
that it did not want to antagonize its
client. Under normal circumstances, I would have had no hesitation in
striking the application
for lack of urgency.
[20]
However, these are not normal circumstances. The respondent entered
into the MSA on 21 January 2026.
Within a month thereafter it was
refusing to issue new purchase orders. The ‘concerns’
regarding procurement issues
only arose in March 2026, and could not
have been the cause of the delay in issuing the purchase orders in
February. The respondent
has not explained why it would not issue new
purchase orders in February.
[21]
We are now almost six months on from when these ‘concerns’
were raised, but there is no
indication as yet that the investigation
has an end in sight. I have not been told what the exact allegations
against the applicant
are, what its alleged involvement was with the
Telkom/BCX contract, what irregularities are suspected to have
occurred, nor how
they may impact this contract.
[22]
The respondent is quite happy to accept the benefit of the services,
but is not willing to pay one
cent towards their procurement. That
is, to me, iniquitous. I expect better judgment from a government
department. If there are
real concerns regarding the contract, or
regarding previous procurement ‘irregularities’, then
take the bull by the
horns and suspend the contract. The respondent
cannot expect the applicant to continue to provide services without
any payment
in sight. The Minister cannot have his cake and eat it.
[23]
In some instances the strength of a case on the merits may outweigh
the considerations of urgency,
as it does in this matter. It is so
that a decision on urgency is a matter within my discretion, and
despite the applicant’s
extremely dilatory approach to the
matter, I choose to find that the matter is urgent for the aforesaid
reasons. I also take into
consideration that the applicant is under
financial strain, a formal demand for payment of approximately R 8
million having been
made by a debtor. I also do not think that it is
appropriate to expect a company to place its finances at the State’s
disposal
without expectations of any return in the foreseeable
future. Commercial imperatives can be as urgent as any other.
[3]
[24]
As for a defence on the merits of the matter, there is none.
[25]
I make the following order:
[25.1]
The respondent is ordered to assign a purchase order for the services
that the applicant is
obliged to render for the period 1 March 2026
to 28 February 2027.
[25.2]
The respondent shall pay the costs of this application including the
costs of counsel on scale
B.
SWANEPOEL J
JUDGE OF THE HIGH
COURT
GAUTENG
DIVISION PRETORIA
[1]
1980
(1) SA 301
(D) at 305 E
[2]
2000
(2) SA 782 (SCA)
[3]
Twentieth
Century Fox Film Corporation and Another v Anthony Black Films (Pty)
Ltd
1982 (3) SA 582
(W)