BW Bright Water Way Props (Pty) Ltd v Eastern Cape Development Corporation (EL848/2017; ECD 2148/2017) [2019] ZAECELLC 20; [2019] 4 All SA 27 (ECL); 2019 (6) SA 443 (ECG) (26 July 2019)

BW Bright Water Way Props (Pty) Ltd v Eastern Cape Development Corporation (EL848/2017; ECD 2148/2017) [2019] ZAECELLC 20; [2019] 4 All SA 27 (ECL); 2019 (6) SA 443 (ECG) (26 July 2019)

The court found that the lease agreement between the applicant and respondent was concluded without compliance with constitutional and statutory requirements for transparency, competitiveness, and public participation in the letting of state property. Although the applicant had performed or tendered performance, the respondent's process was not open or competitive, and the agreement was reached through exclusive negotiations. The respondent's delay in seeking self-review was unreasonable, but the court was bound by constitutional principles to declare the contract invalid. However, applying section 172(1)(b) of the Constitution, the court preserved the applicant's accrued rights under the...

Citation
[2019] ZAECELLC 20
Parties
Applicant: BW Bright Water Way Props (Pty) Ltd; Respondent: Eastern Cape Development Corporation
Court
Eastern Cape High Court, East London Local Court
Jurisdiction
South Africa
Judgment Date
26 July 2019
Case Number
EL848/2017; ECD 2148/2017
Procedural Posture
Review Application / Judgment After Main and Counter Application
Outcome
Main application dismissed; counter application succeeds to the extent that the lease agreement is declared constitutionally invalid, but accrued rights are preserved.
Judges
I.T. Stretch
Legal Topics
Legality Review, Unreasonable Delay, Public Procurement, Specific Performance, Market Related Rental, Non Joinder
Constitutional Law Administrative Law Land and Property Legality Review Unreasonable Delay Public Procurement Specific Performance Market Related Rental +1 more

Case Brief

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Parties

BW Bright Water Way Props (Pty) Ltd

Applicant

Eastern Cape Development Corporation

Respondent

Procedural Posture

Review Application / Judgment After Main and Counter Application

Legal Issues

  1. 1 Whether the lease agreement between the applicant and respondent is constitutionally valid and enforceable.
  2. 2 Whether the respondent's counter application for self-review should be dismissed due to unreasonable delay.
  3. 3 Whether the applicant's failure to join third parties (the Bothas) is fatal to its application.

Ratio Decidendi

The court found that the lease agreement between the applicant and respondent was concluded without compliance with constitutional and statutory requirements for transparency, competitiveness, and public participation in the letting of state property. Although the applicant had performed or tendered performance, the respondent's process was not open or competitive, and the agreement was reached through exclusive negotiations. The respondent's delay in seeking self-review was unreasonable, but the court was bound by constitutional principles to declare the contract invalid. However, applying section 172(1)(b) of the Constitution, the court preserved the applicant's accrued rights under the...

Court Disposition

Main application dismissed; counter application succeeds to the extent that the lease agreement is declared constitutionally invalid, but accrued rights are preserved.

Orders

  • The main application is dismissed.
  • The lease agreement concluded on 20 December 2016 is declared constitutionally invalid.