Bushbuckridge Local Municipality v Mylocel (Pty) Ltd (1537/2019) [2021] ZAMPMHC 23 (27 August 2021)

Bushbuckridge Local Municipality v Mylocel (Pty) Ltd (1537/2019) [2021] ZAMPMHC 23 (27 August 2021)

The court found that the service agreement between the applicant and respondent was concluded without compliance with the constitutional and statutory procurement requirements. No competitive bidding process was followed, and the requirements for an unsolicited bid under Section 113 of the Municipal Financial Management Act and Regulations 36 and 37 were not met. The respondent failed to prove that it was the sole provider or that its product was unique and exceptionally beneficial, nor were reasons for deviation recorded as required. Although the applicant delayed in bringing the review application, the court exercised its discretion to overlook the delay, considering the involvement of...

Citation
[2021] ZAMPMHC 23
Parties
Applicant: Bushbuckridge Local Municipality; Respondent: Mylocel (Pty) Ltd
Court
Middelburg High Court, Mpumalanga
Jurisdiction
South Africa
Judgment Date
27 August 2021
Case Number
1537/2019
Procedural Posture
Review Application / Judgment
Outcome
Application granted. The service agreement is declared invalid and set aside from the date of termination. Costs awarded to the applicant.
Judges
Mtimunye
Legal Topics
Legality Review, Section 172 Constitution, Municipal Procurement, Unsolicited Bids, Delay in Review, Just and Equitable Remedy
Administrative Law Constitutional Law Civil Procedure Legality Review Section 172 Constitution Municipal Procurement Unsolicited Bids Delay in Review +1 more

Case Brief

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Parties

Bushbuckridge Local Municipality

Applicant

Mylocel (Pty) Ltd

Respondent

Procedural Posture

Review Application / Judgment

Legal Issues

  1. 1 Whether the service agreement between the applicant and respondent was constitutionally invalid due to non-compliance with procurement requirements.
  2. 2 Whether the agreement met the requirements for an unsolicited bidding process under the Municipal Financial Management Act and regulations.
  3. 3 Whether the delay of fifteen months in bringing the review application should be condoned.

Ratio Decidendi

The court found that the service agreement between the applicant and respondent was concluded without compliance with the constitutional and statutory procurement requirements. No competitive bidding process was followed, and the requirements for an unsolicited bid under Section 113 of the Municipal Financial Management Act and Regulations 36 and 37 were not met. The respondent failed to prove that it was the sole provider or that its product was unique and exceptionally beneficial, nor were reasons for deviation recorded as required. Although the applicant delayed in bringing the review application, the court exercised its discretion to overlook the delay, considering the involvement of...

Court Disposition

Application granted. The service agreement is declared invalid and set aside from the date of termination. Costs awarded to the applicant.

Orders

  • The Digital Broadcast Solution Service Agreement between Bushbuckridge Municipality and Mylocel (Pty) Ltd is declared invalid in terms of Section 172(1)(a) of the Constitution.
  • In terms of Section 172(1)(b) of the Constitution, the contract is set aside only as from the date it was cancelled/terminated by the applicant.