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IN THE HIGH COURT OF SOUTH AFRICA

(GAUTENG DIVISION, PRETORIA)

 

(1)       NOT REPORTABLE

(2)       NOT OF INTEREST TO OTHER JUDGES

(3)       REVISED

Case No.: 11325/2017

29/6/2018

In the matter between:

 

RADABEL CC                                                                                                                   Applicant

 

And

 

NATIONAL METROLOGY INSTITUTE

OF SOUTH AFRICA                                                                                                        Respondent

 

JUDGMENT

Senyatsi AJ

INTRODUCTION

[1]       This is an opposed application for an order to set aside the respondent's decision to cancel bid number NMISA(16-17) T0023 ("the.Bid") and an order directing the Respondent to appoint the applicant as the successful bidder and the order to direct the respondent to conclude a service level agreement for theBid with the applicant.

 

BACKGROUND.

[2]        On 20 May 2016 the Respondent advertised the Bid for supply of a benchtop automated ampoule filling and sealing machine, including commissioning, training and consumables under bid number T0023.

[3]        The Respondent received 4 (four) bids from bidders. The applicant was amongst the bidders. The bidders were evaluated in three stages. These stages consisted of :-

[3.1]     Compulsory Technical Specification;

[3.2]     FUNCTIONALITY and

[3.3]     Price and BBBEE.

 

[4]        The applicant was successful and went through the first stage. The other three bidders were not successful as they had shared "NO" for any items in the compulsory technical specification section.

[5]        The applicant went through to the second stage of evaluation on Functionality. It was a condition of the bid that in order to advance to the next stage, that is, the third stage of PRICE and BBBEE, the bidder had to score 80 or more points on FUNCTIONALITY.

[6]       The applicant was scored initially 85 points on FUNCTIONALITY and later, when a reference check was done on the customer reference letters, the score was reduced by 10 points to 75 points. This was after another report was received from the same customer who provided the initial reference letter. Consequently, the Respondent declared that there was no successful bidder and cancelled the Bid.

[7]        The applicant contends that by scoring it 75 points FUNCTIONALITY, the Respondent was irrational, unreasonable, violation of the Applicant's rights to just administrative action and therefore invalid. The Applicant contends furthermore that the letter by Department of Water and Sanitation marked annexure"PIM13" was compliant with the Bid.

[8]        The applicant contends furthermore that in terms of the Bid, the bidder was required to provide Reference list of three customers or more and one reference letter and that the letter should detail successful commissioning, operation and maintenance support. The letter that was provided detailed successful commissioning, operation and maintenance support.

[9]       The Respondent contends that as a follow up to the reference letter it was within its right to contact the Department of Water and Sanitation to verify the information. It contends that it did so and received a report from the Department of Water and Sanitation, as a customer of the Applicant. Consequently, contends the Respondent, the letter was not compliant with the Bid requirements.

[10]     The Respondent raised a point in limine and contended that the applicant has omitted to deal with all points raised in the Rule 6(5)(d)(iii) Notice.

 

The issues for determination

[11]       This Court is required to determine the following issues:-

[11.1]     Whether or not the applicant has omitted to deal with all points raised in the Rule 6(5)(d)(iii) Notice and

[11.2]     If there is a finding that the point in limine fails, whether or not the Respondent was irrational and unreasonable in violation of the Applicant's right to a just administrative action by scoring the Applicant 75 points on FUNCTIONALITY in the Bid and by subsequently cancelling the Bid.

 

The legal principles

[12]     The first point raised by the Respondent will be dealt with Rule 6(5)(d)(iii) of the Uniform Rule provides as follows:-

"(d)   Any person opposing the grant of an order sought in the notice of motion must

(iii)    if he or she intends to raise any question of law only, he or she must deliver notice of his or her intention to do so, within the time stated in the proceeding sub-paragraph, setting forth such application."

 

[13]      I find no basis for the argument by the Respondent that the point raised in terms of Rule 6(5)(d)(iii) will entitle the dismissal of the application. Consequently, the argument must fail.

[14]      As regards the merits of the application, the law on the administrative process of tender award is pretty much settled.

[15]      The instructive source of reference is on the matter is section 195(1)(f) and (g) of the Constitution of the Republic of South Africa Act No 14 of 2004(''the Constitution) which provides as follows:-

 

"(1)   Public administration must be governed by the democratic values and principles enshrined in the Constitution including the following principles:

(f)       Public administration must be accountable and

(g)     Transparency must be fostered by providing the public with timely, accessible and accurate information".

 

[16]       The Respondent falls within the definition of section 195(1)(f) and (g) as it is an institution of the State.

[17]     Section 33 of the Constitution provides as follows:-

"33. Just administrative action-

(1)          Everyone has the right to administrative action that is lawful, reasonable and procedurally fair

(2)         Everyone whose rights have been adversely affected by administrative action has the right to be given written reasons."

 

[18]     Another piece of legislation which is just as instructive is Promotion of Access to justice Act 3 of 2000 ("PAJA") section 3 of PAJA provides as follows:-

"(1)   Administrative action which materially and administratively affects the rights or legitimate expectation of any person must be procedurally fair.

(2)    (a)           A fair administrative procedure depends on the

circumstances of each case.

(b)          In order to give effect to the right to procedurally fair administrative action, an administrator, subject to subsection (4) must give a person referred to in subsection

(1) -

(i)       adequate notice of the nature and purpose of the proposed administrative action;

(ii)     a reasonable opportunity to make representations;

(iii)    a clear statement of the administrative action;

(iv)    adequate notice of any right of review or internal appeal, where applicable; and

(v)    adequate notice of the right to request reasons in terms of section."

 

[19]      Any person dissatisfied with the decision of the Tender Committee assessing the Bid, has the right to challenge procurement decisions on the grounds of lawfulness, reasonableness and procedural fairness.

[20]      It is also settled that the institutions such as the Respondent, do in fact perform administrative act when it comes to procurement decisions and person adversely affected by such decisions may find refuge in section 33 of the Constitution.[1]

[21]      In Logbro Properties CC v Bedder Son NO and Another[2] the Supreme Court of Appeal, in dealing with the question whether it was procedurally fair not to give the bidder an opportunity to make representations on the decision to cancel the tender held as follows:-

''[25]     Procedural fairness, in my view. demanded that the committee in reconsidering the tenders would afford the compliant tenders an opportunity to make representations, at least in writing, on any factor that might lead the committee not to award the tender at all. That opportunity not having been afforded, the committee's 1997 decision must be set aside, and the matter remitted to the appropriate authority to afford the appellant authority to afford the appellant and other compliant tenders the opportunity to make representations, at least in writing, on any supervening consideration relevant to the committee's exercise of its powers in relation to the award or non-award of the tender."

 

[22]      In Millinnium Waste Management v Chairperson, Tender Board[3] the Supreme Court of Appeal held as follows in dealing with whether or not the tender committee can condone non-compliance with peremptory requirements where condonation is not incompatible with public interest:-

"[17]     Moreover, our law permits condonation of non-compliance with peremptory requirements in cases where condonation is granted by the body in whose benefit the provision was enacted."

 

[23]       I was referred by counsel for the Respondent to MEC For Environmental Affairs v Clairison's[4] In that case, at 239 paragraph 18 the Court held as follows:-

"We think it is apparent from the extract from the extracts from her judgment we have recited, and the judgement read as a whole, that the learned Judge blurred the distinction between an appeal and a review. It bears repeating that a review is not concerned with the decision made by a functionary, but with whether he performed the function with which he was entrusted. When the law entrusts a functionary with a discretion it means just that. The law gives recognition to the evaluation made by the functionary to whom the discretion is extracted, and it is not open to a Court to second-guess his evaluation. The role of a Court is no more than to ensure that the decision-maker has performed the function with which he was entrusted"

 

[24]      The merits of this application are not dealing with the correctness or lack thereof, but rather with the procedural fairness of the administrative action. This case is therefore distinguishable from the case quoted.

 

Reasons for the judgment

[25]      In this case, the tender committee of the Respondent initially allocated the score of 85 points on FUNCTIONALITY on the basis of the letter of reference referred from the Department of Water and Sanitation written by Ms Vermaak.

[26]      When Madiga did the reference check which Ms Vermaak at the Department of Water and sanitation, she expressed various concerns. It is important to note that Ms Vermaak was the author of the first reference letter which did not raise the concerns as raised in the "PM10" report.

[27]      Following the report from Ms Vermaak, the Tender Committee was reconstituted to reconsider the 10 points awarded based on the initial letter. It was at this second seating that a decision was taken to reduce the 10 points with the effect of the score reduction from 85 points to 75 points. The Respondent, in my view, ought to have been concerned with the contradiction of the reference letter initially written by Ms Vermaak and the latest report prepared in answer to Madinga's questions

[28]      I am of the view that the Applicant ought to have been afforded an opportunity to make representations given the new, adverse report by Ms Vermaak. If the Tender Committee of the Respondent had not been reconstituted, the score of 85 points would have prevailed. The impact of the new report by Ms Vermaak was of such a nature that the Tender Committee should have asked the Applicant to comment before a decision to reduce the score and cancel the Bid was made.

[29]     Absent such invitation by the Respondent’s Tender Committee for a representation by the Applicant, the procedure was, in my view, flawed and the decision to cancel the Bid should be reviewed.

[30]     Consequently, I am of the view that the applicant has made out a case with regards to prayer 1, 2 and 3 of the Notice of Motion. I am not satisfied that a case has been made for the other prayers as there is no evidence on PRICE and BBBEE

 

ORDER

[24]       The following order is made:-

(a)     The decision of the Respondent to cancel the Bid is hereby reviewed and set aside.

(b)     The matter is remitted to afford the Applicant an opportunity to make representations to deal with the report by Ms Vermaak of Department of Water and Sanitation.

(c)     The Respondent is ordered to pay the costs of this application.

 

 

M. L. SENYATSI

ACTING JUDGE OF THE HIGH COURT OF SOUTH AFRICA

GAUTENG DIVISION

 

FOR THE APPLICANT                :           ADV. B HLANGWANE

INSTRUCTED BY                         :           MASHAMAITE MR ATTORNEYS

TEL- 012 3211135

FOR THE RESPONDENTS          :           ADV. KK MAPUTLA

INSTRUCTED                                :           POSWA INC

TEL- 011 783 8877

DATE FOR HEARING                   :           24 APRIL 2018

DATE FOR JUDGMENT               :           29 JUNE 2018

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