[2022] KEHC 285 (KLR)

Republic v Public Procurement Administrative Review Board; Kenya Ports Authority & 7 others (Interested parties); Liason Group (Insurance Brokers) Limited & 3 others (Exparte) (Judicial Review Application 3A & 30 of 2020 & Judicial Review Miscellaneous Application 2 of 2020 (Consolidated)) [2022] KEHC 285 (KLR) (16 March 2022) (Ruling)

Neutral citation: [2022] KEHC 285 (KLR)

Republic of Kenya

In the High Court at Mombasa

Judicial Review Application 3A & 30 of 2020 & Judicial Review Miscellaneous Application 2 of 2020 (Consolidated)

JM Mativo, J

March 16, 2022

Between

Republic

Applicant

and

Public Procurement Administrative Review Board

Respondent

and

Kenya Ports Authority

Interested party

The Accounting Officer, Kenya Ports Authority

Interested party

Utmost Insurance Brokers Limited

Interested party

Disney Insurance Brokers Limited

Interested party

and

Liason Group (Insurance Brokers) Limited

Exparte

As consolidated with

Judicial Review Miscellaneous Application 2 of 2020

Between

Republic

Applicant

and

Public Procurement Administrative Review Board

Respondent

and

Utmost Insurance Brokers Limited

Interested party

Disney Insurance Brokers Limited

Interested party

Pelican Insurance Brokers (Kenya) Ltd

Interested party

and

Kenya Ports Authority

Exparte

The Accounting Officer, Kenya Ports Authority

Exparte

As consolidated with

Judicial Review Application 30 of 2020

Between

Republic

Applicant

and

Public Procurement Administrative Review Board

Respondent

and

Kenya Ports Authority

Interested party

Accounting Officer, Kenya Ports Authority

Interested party

Utmost Insurance Brokers Limited

Interested party

Disney Insurance Brokers Limited

Interested party

Liason Insurance Brokers Limited

Interested party

Pelican Insurance Brokers Limited

Interested party

and

Pelican Insurance Brokers Limited

Exparte

Ruling

1. This ruling addresses a pertinent jurisdictional question which goes into the heart of these three consolidated Judicial Review Applications. The common thread between the three cases is that they all seek to upset a decision of Public Procurement Administrative Review Board (the Review Board) dated 20th January, 2020 in PPARB Application number 147 of 2019, Utmost Insurance Brokers Ltd v The Kenya Ports Authority & another and Disney Insurance Brokers Limited & 2 others (Interested Parties).

2. In order to put the jurisdictional question under consideration into a proper perspective, it is necessary to highlight, albeit briefly, the factual matrix which triggered the dispute which is essentially common ground or uncontroverted. The Kenya Ports Authority (the Procuring Entity) advertised for various tenders among them Tender PA/003/2019-20 INS for provision of Insurance Services on My Gov Newspaper inviting bids from eligible bidders. After completion of the pre-qualification and evaluation processes, the Evaluation Committee deliberated, evaluated and recommended bidders for award of the tender. In a memo dated 3rd December 2019, the Procuring Entity’s Acting Head of Procurement and Supplies expressed his professional opinion on the procurement process and advised the Managing Director to award the tender for the year 2020-2022 to the firms recommended by the Evaluation Committee for a period of three years. The Managing Director reviewed and approved the said professional opinion on 4th December 2019. Vide letters dated 16th December 2019, all the bidders were notified of the outcome of their bids.

3. Aggrieved by the decision, Utmost Insurance Brokers Limited lodged a Request for Review at the Review Board on 30th December 2020 seeking orders: - that the decision to award the tender be annulled and set aside; an order substituting the decision with an order that the tender in the respective classes or policies be awarded to it; an order compelling the Respondent to sign the contract with it; in the alternative, an order that the entire process be nullified. It also sought an order that the Respondent be directed to pay the costs of and incidental to the proceedings and such other or further relief or reliefs as the Review Board shall deem just and expedient. Upon hearing the parties in exercise of its powers under section 173 of the Public Procurement and Asset Disposal Act1(the PPAD Act) the Review Board directed the Procuring Entity to re-tender for Provision of Insurance Services for the year 2020-2022 within 14 days from the date of the decision. It also ordered each party to bear its own costs.1Act No. 33 of 2015.

4. On 29th January 2020, Liason Group (Insurance Brokers) Ltd filed JR Misc App No. 3A of 2020 sought for and obtained this courts leave to quash the said decision. It filed the substantive motion on 4th February 2020. Also, on 3rd January 2020, the Procuring Entity filed JR No. 2 of 2020 seeking leave to apply for certiorari. The leave was granted on 4th February 2021 and it filed the substantive motion on 13th February 2020. Lastly, on 31st January 2020, Pelican Insurance Brokers Limited also obtained leave to apply for certiorari and filed its application on 6th February 2020.

5. On 11th March, 2020, the 3 applications were consolidated and the court ordered that Mombasa JR. No. 3 of 2020 shall be the lead file. As was held in Korean United Church of Kenya & 3 Others v Seng Ha Sang,2 consolidation of suits is done for the purposes of achieving the overriding objective of expeditious and proportionate disposal of civil disputes. Consolidation saves costs, time and effort and makes the conduct of several actions more convenient by treating them as one action. The rationale behind consolidation of matters is to avoid conflicting judgments, save time and money by clubbing together matters involving common questions of fact and law.2{2014} e KLR.

6. These suits have been pending in this court for over two years. There is no reason or explanation why they have been pending in court for that long. Sadly, trial delays remain the bane of our justice delivery system, a fact that should worry anyone who cares about speedy resolution of court disputes dictated by Article 159 of the Constitution. Owing to this unexplained delay, these cases were caught up by the provisions of section 175 of the PPAD Act which provides: -175. Right to judicial review to procurement

(1)A person aggrieved by a decision made by the Review Board may seek judicial review by the High Court within fourteen days from the date of the Review Board's decision, failure to which the decision of the Review Board shall be final and binding to both parties.(2)The application for a judicial review shall be accepted only after the aggrieved party pays a percentage of the contract value as security fee as shall be prescribed in Regulations.(3)The High Court shall determine the judicial review application within forty-five days after such application.(4)A person aggrieved by the decision of the High Court may appeal to the Court of Appeal within seven days of such decision and the Court of Appeal shall make a decision within forty-five days which decision shall be final.(5)5) If either the High Court or the Court of Appeal fails to make a decision within the prescribed timeline under subsection (3) or (4), the decision of the Review Board shall be final and binding to all parties.

7. On 3rd March, 2021 the Court of Appeal in Aprim Consultants v Parliamentary Service Commission & Another3overturned a High Court decision in a procurement process delivered 185 days outside the 45 days stipulated in section 175 of the Act. It described the High Court judgment as a nullity holding the court’s jurisdiction is time bound, so it lapsed with the effluxion of the 45 days. I invited the parties to address the court on of effect of the said decision to this case (if any). Mr. Meso, counsel for the applicant in JR No. 3A of 2020 submitted that as early as November 2020 and long before the Court of Appeal delivered the said judgment, all the parties in these cases had filed and exchanged written submissions and the matters had been set down for highlighting of submissions on 12th May 2020. He argued that it would be prudent that this court determines the cases and render a judgement in the interest of justice.3{2021} e KLR

8. He relied on the Articles 48 and 50 (1) of the Constitution which guarantees access to justice and the right to a fair hearing respectively which he argued were under threat if the parties were locked out from the court. To fortify his argument, he cited Republic v Kenya Revenue Authority Ex Parte Webb Fontaine Group FZ-LLC & 3 Others4 which underscored the duty of the State to ensure access to justice holding that the court’s jurisdiction may be precluded or restricted either by legislative mandate or certain special texts. He submitted that where an ouster clause leaves an aggrieved party with no effective remedy, the ouster clause should be considered unreasonable. He cited Judicial Service Commission v Kaplana Rawal5in support of the proposition that a court should grant a party before it the right to have a case touching on the fundamental rights and freedoms concluded to its logical end. Fortified by the said jurisprudence, counsel argued that despite the Court of Appeal decision, the applicants have a constitutional right to access justice and to have the cases heard fairly and resolved. Lastly, he argued that the right to fair hearing is absolute and may not be limited for any reason whatsoever as provided for under article 25 (c) of the Constitution. To support this proposition, he cited Phillip Tunoi & Another v Judicial Service Commission & Another6 which held that the right to a fair hearing is embedded in the Constitution.4{2015} e KLR.5{2015} e KLR.6{2016} e KLR.

9. Mr. Cheruiot, counsel for the 1st and 2nd Interested supported Mr. Meso’s submissions. Even though he said he filed written submissions on the Court of Appeal decision, the submissions in the court file relate to the judicial review application. He argued that before this court is a public interest issue because the assets sought to be insured go beyond the bids since they are insurance policies covering all the assets of the Procuring Entity. He argued that it is not in public interest for this court to down its tools because it will be impossible for the Procuring Entity to comply with the orders of the Review.

10. Mr. Muturi, counsel for the 3rd Interested Party submitted that the Court of Appeal in the above decision held that the jurisdiction of the High Court in procurement matters is time bound and after the 45 days stipulated under the Act, it ceases due to effluxion of time which renders any Judgment rendered outside the time stipulated by the law a nullity, bereft of any force or effect in law. He submitted that the jurisdiction of this court to review the decision of the Review Board emanates from Section 175 of the PPAD Act. He submitted that the said jurisdiction is not absolute, but it is time-bound and limited to the extent that the court must deliver its decision within 45 days of institution of the case. He pointed out that these cases were filed between 29th January, 2020 and 3rd February, 2020, and, that, the period for determination of the matters has since lapsed. He submitted that Section 175 of the PPAD Act is couched in mandatory terms and as such this court cannot sustain these applications.

11. He also cited The Joint Venture of Lex Oilfield Solutions Ltd & Cfao Kenya Ltd v The Public Procurement Administrative Review Board & 4 Others7 in which the High Court held that any attempt to deliver a judgement outside the 45-day period would be futile and an un-warranted assumption of non-existent jurisdiction. Additionally, he cited Kate Kokumu & Another v University of Nairobi & 2 Others which up held a similar position. He also cited Samuel Macharia & Another v Kenya Comercial Bank Limited & 2 Others8 which held that a court’s jurisdiction flows from the Constitution or legislation or both. Also, he relied on Republic v The Public Procurement Administrative Review Board Ex parte Express Automation Limited9 which held that courts cannot sanction or flout the timelines expressly provided for under Section 175 of the PPAD Act as the same are couched in plain and unambiguous terms and the same is not available for any alternative interpretation.7Misc. App No. 156 of 2021. 8{2012} e KLR.9JR No. E1155 of 2020.

12. Responding to the argument that this court will be flouting the applicant’s right to a fair trial if it abides by the mandatory provisions of section 175(3) of the Act, he cited Al Ghurair Printing and Publishing LLC v Coalition for Reforms and Democracy & 2 others10in which it was held that there is nothing in the elaborate provisions of Section 175 of the PPAD Act that goes against the Constitution or that is inimical or likely to lessen or adversely affect or undermine the constitutional underpinning of the remedy of judicial review. He also cited Republic v Public Procurement Administrative Review Board & another Ex-parte Selex Sistemi Integrati11 which held that that the elaborate provisions and ouster clauses in the then Public Procurement and Disposal Act, 2005 were tailored to accelerate finality of public projects. Lastly, he cited The Joint Venture of Lex Oilfield Solutions Ltd & Cfao Kenya Ltd v The Public Procurement Administrative Review Board & 4 Others (supra) which held:-10{2017} e KLR.11{2008} KLR 728. “Without a doubt, the matter before the court is a perfect example of the serious difficulties posed by the short timelines set in section 175(3) of the Act ... whereas the Court will do all in its power to meet the timelines as we continue doing in many of the matters, more than usual diligence is called upon from would be applicants to ensure they, with the support of the court, drive the agenda to meet the timelines set by law.”

13. Because this ruling seeks to address the import of the Court of Appeal decision in Aprim Consultants v Parliamentary Service Commission & Another(supra) to these proceedings, it is important I generously reproduce excerpts from the said judgment so as to distil the legal principles determined by the Court and the ratio decidendi of the decision which is binding to this court. Discussing section 175 of the Act, the Court of Appeal stated:“We think, with respect, that the provisions of section 175 are couched in terms that are plain, and unambiguous, admitting to no interpretative wriggle. The section sets strict timelines for applicants, the High Court and this court in sequential manner……………………………………………………….Whereas judges of the High Court have questioned and with good reason, the wisdom and practicality of the particular timelines in the Statute, the position of the court has been an express endorsement of their constitutionality. In Al Ghurair Printing and Publishing LLC v Coalition for Reforms and Democracy & 2 others.12 Gatembu JA rendered himself thus on this point:12{2017} e KLR.37. The importance of the timeliness is buttressed by section 175(5), which provides that the decision of the Review Board shall be final and binding to all the parties should the High Court or the Court of Appeal fail to make a decision within the prescribed timeliness.40. In my view, there is nothing in the elaborate provisions under section 175 of the Act that goes against the Constitution or that is inimical or likely to lessen or adversely affect or undermine the constitutional underpinning of the remedy of judicial review. Nyamu J (as he then was) in Republic v Public Procurement Administrative Review Board & another ex parte Selex Sistemi13opined that the elaborate provisions and ouster clauses in the then Public Procurement and Disposal Act, 2005, “were tailored to accelerate finality of public projects.”13{2008} KLR 728. We respectively share the same view

14. The Court of Appeal also cited with approval the High Court decision in Republic v Public Procurement Administrative Review Board & another ex parte Wajir County Government14 in which the High Court in determining a preliminary objection raised against judicial review proceedings challenging the decision of the Review Board filed outside of the 14 days stipulated in section 175(1), the learned judge (Odunga J) first referred to section 9(3) of the Law Reform Act15 which provides that an application for an order of certiorari shall not be granted unless made not later than 6 months after the date of the decision sought to be quashed “or such shorter period as may be prescribed under any written law.” The Learned judge stated: -14{2016} e KLR.15Cap 26, Laws of Kenya.“15. Therefore, for the purposes of judicial review, an enactment may perfectly provide a shorter period within which challenge to s decision of the review board may be taken and if not that decision would be final. That is exactly what section 175 of the act provides. A provision limiting the time for making an application for judicial review is therefore perfectly in order and cannot therefore be termed as being unconstitutional.16. It is not for this court to interpret legislation in a manner that completely alters the legislative intent of the enactment. Where there is a lacuna in law as contended by the ex parte applicant herein the recourse is to move Parliament to correct the same and not to urge this court to in effect amend the same. It is not competent to any court to proceed upon an assumption that Parliament has made a mistake, there being a strong presumption that Parliament does not make mistakes. If blunders are found in legislation, they must be corrected by legislature, and it is not the function of the court to repair them. Thus, where terms can be introduced into a statute to give effect to its clear intention by remedying mere defects of language and to correct obvious misprints or misnomers, no provision which is not in the statute can otherwise be implied to remedy an omission. See Italframe v Mediterranean Shipping Co.1616{986} KLR 54, {1986-1959} EA 174. 17. In this case what the applicant is asking the court to do is just to correct mere defects of language or obvious misprints or misnomers but to substantially alter the legislative intent as enacted in section 175 of the Act by inserting a clause therein whose effect would amount to the extension of time as enacted by the legislature. That in my mind, this court cannot do.”

15. Additionally, the Court of Appeal stated: - “we accept that the proper approach a court must take when faced with clear statutory commands, no matter how much they appear to be burdensome. Inconvenience or difficulty of compliance will never be an excuse for a court to go against the clear language of Parliament. The most a court can do is point out the difficulties created by such requirement and timelines and perhaps make proposals for reform, but as long as the law remains etched, in plain language, it is the province of the courts to interpret and give effect to its express language.” Further, it stated: - “a perusal of section 175 of the Act reveals Parliament’s unmistakable intention to constrict the time taken for filing and determination of public procurement disputes in keeping with the Act’s avowed intent and object of these disputes. Parliament was thus fully engaged and intentional in setting the timeliness in the section. But it did not stop there. In one of the rarer instances where all discretion is totally shut out, Parliament expressly enacted a consequence to follow default or failure to file or to decide within the prescribed time: the decision of the Board would crystalize and be invested with finality.”

16. A pertinent issue suitably clarified by the Court of appeal is the time bound jurisdiction conferred to High Courts and the Court of Appeal by section 175. The Court of Appeal held that the court’s jurisdiction under the said provision is time bound and it ran out and ceased by effluxion of time the moment the 45 days ended. The court was emphatic that any judgment returned outside time would be without jurisdiction and therefore a nullity bereft of any force or effect in law. It cited Samuel Macharia & another v Kenya Commercial Bank ltd & 2 others17 which held that a court of law can only exercise jurisdiction as conferred by the Constitution or other written law. The court summed up the law in the following words “it seems clear to us that the jurisdiction of the High Court in public procurement judicial review proceedings is expressly limited in terms of time and is not open to expansion by that court. To step out of time is to step out of jurisdiction and any act or decision outside jurisdiction is by application of first principles a nullity.”17{2012} e KLR.

17. In simple words jurisdiction can be defined as the limit of judicial authority or the extent to which a court of law can exercise its authority over suits, cases, appeals and other proceedings. The rationale behind introducing the concept of jurisdiction in law is that a court should be able to try and adjudicate only in those matters with which fall within the limits of its authority. Section 5 of the Civil Procedure Act18 confers jurisdiction over the civil courts to adjudicate upon all suits of civil nature, except such suits the cognizance of which is either expressly or implied barred. In other words, whenever the object of the proceedings is the enforcement of civil rights, a civil court would have jurisdiction to entertain the suit unless the cognizance of the same is barred through a legislative instrument. Clearly, the jurisdiction of the civil court does not extend to all matters but might be limited in certain cases.18Cap 21, Laws of Kenya.

18. There are constitutional or statutory restrictions on a court's jurisdiction. Constitutional or statutory enactments dealing with the various types of cases may prescribe, as a general rule, procedural prerequisites or conditions which must be met by any litigant. There is a broad variety of time-limits for the different types of applications to court. Time-limits serve the purpose of legal certainty, as they ensure that, after a certain period of time, an act’s validity becomes unassailable. A court must have jurisdiction to enter a valid, enforceable judgment on a claim. Where jurisdiction is lacking, litigants, through various procedural mechanisms, may retroactively challenge the validity of a judgment.

19. When a court settles an issue, a conflict or a controversy between parties, it becomes the law on those issues and conflicts. Such a decision is a precedent. A precedent is a statement of law found in decision of the superior court. Such decisions are binding to the inferior courts. As was held in Union of India v Raghubir Singh19 :-19(AIR 1989 SC 1933).“The doctrine of binding precedent has the merit of promoting a certainty and consistency in judicial decisions, and enables an organic development of the law, besides providing assurance to the individual as to the consequence of transaction forming part of daily affairs. And, therefore, the need for a clear and consistent enunciation of legal principle in the decisions of a court.”

20. The decision of the Court Appeal in Aprim Consultants v Parliamentary Service Commission & Another(supra) is binding on this court. As was held in R v Nor. Elec. Co.20:-20[1955] 431. “...The doctrine of stare decisis is one long recognized as a principle of our law. Sir Frederick Pollock, in his First Book of Jurisprudence, 6th ed., p. 321: “The decisions of an ordinary superior court are binding on all courts of inferior rank within the same jurisdiction, and though not absolutely binding on courts of co-ordinate authority nor on the court itself, will be followed in the absence of strong reason to the contrary…”

21. Even if the Court of Appeal had not pronounced itself in the above case, a reading of section 175 of the PPAD Act leaves no doubt that it is couched in mandatory terms. The use of the word shall in the said section connotes a mandatory obligation. The question as to whether a statute is mandatory or directory depends upon the intent of the legislature and not upon the language in which the intent is clothed. The meaning and intention of the legislature must govern, and these are to be ascertained, not only from the phraseology of the provision, but also by considering its nature, its design, and the consequences which would follow from construing it the one way or the other. Indeed, public procurement law practically bristles with formalities and timelines which bidders often overlook at their peril. The rigid timelines are clearly spelt out in the PPAD Act in mandatory requirements – in other words they are a sine qua non for further consideration of the proceedings.

22. When a statute uses the word shall, prima facie, it is mandatory, but the court may ascertain the real intention of the legislature by carefully attending to the whole scope of the statute. For ascertaining the real intention of the Legislature the court may consider, inter alia, the nature and the design of the statute, and the consequences which would follow from construing it the one way or the other, the impact of other provisions whereby the necessity of complying with the provisions in question is avoided, the circumstance, namely, that the statute provides for a contingency of the non-compliance with the provisions, the fact that the non-compliance with the provisions is or is not visited by some penalty, the serious or trivial consequences that flow therefrom, and, above all, whether the object of the legislation will be defeated or furthered. In this regard, a common thread in the PPAD Act is a clear emphasis on the strict timelines which are aimed at facilitating speedy resolution of trial disputes.

23. A fundamental tenet of statutory interpretation is that the words in a statute must be given their ordinary grammatical meaning, unless to do so would result in an absurdity. There are three important interrelated riders to this general principle, namely: (a) that statutory provisions should always be interpreted purposively; (b) the relevant statutory provision must be properly contextualized; and (c) all statutes must be construed consistently with the Constitution, that is, where reasonably possible, legislative provisions ought to be interpreted to preserve their constitutional validity. This proviso to the general principle is closely related to the purposive approach referred to in (a.)

24. Where, indeed, the whole aim and object of the legislature would be plainly defeated if the command to do the thing in a particular manner did not imply a prohibition to do it in any other manner, no doubt can be entertained as to the intention; that is to say, such a requirement would be imperative. When a statute is passed for the purpose of enabling something to be done, and prescribes the formalities which are to attend its performance, those prescribed formalities which are essential to the validity of the thing when done are called imperative or absolute; but those which are not essential and may be disregarded without invalidating the thing to be done, are called directory. The prescribed timelines are mandatory and carefully crafted to give effect to the legislative intention of the statute which is to avoid trial delays in procurement proceedings which are injurious to the economy of the country.

25. One thing is clear. The PPAD Act is a carefully balanced document. It is designed to provide for a public procurement and asset disposal sufficiently strong and flexible to meet the needs of the Republic, yet sufficiently limited and accountable to the law and a time-bound dispute resolution process to avoid delay in public procurement. The drafters were careful to balance between the public need for an efficient procurement but at the same time emphasizing on need for time bound resolution of disputes to afford aggrieved parties the opportunity to seek court redress. Such time limits cannot be said to be unconstitutional. As Chief Justice Marshall said in McCulloch v Maryland21 while speaking on the role of a court, "we must never forget that it is a constitution we are expounding . . . intended to endure for ages to come, and consequently, to be adapted to the various crises of human affairs."2117 U.S. 4 Wheat. 316 316 (1819).

26. Following the Court of Appeal jurisprudence and the High Court decisions cited above, the conclusion becomes irresistible that the time bound jurisdiction conferred to this court lapsed with the effluxion of the 45 days after the date of filing these consolidated judicial review applications. It follows that this court is divested of jurisdiction to hear and determine these judicial review applications. If this court falls into the trap of entertaining these cases, it will be acting without jurisdiction and the ensuing judgment will be a nullity. I decline the invitation to venture into the said forbidden sphere and dismiss these three consolidated judicial review applications with no orders as to costs.

SIGNED, DATED AND DELIVERED VIRTUALLY AT MOMBASA THIS 16TH DAY OF MARCH 2022. JOHN M. MATIVOJUDGE