Cybko Security Services CC v Dihlabeng Local Municipality and Others (A49/2016) [2017] ZAFSHC 39 (16 March 2017)

Cybko Security Services CC v Dihlabeng Local Municipality and Others (A49/2016) [2017] ZAFSHC 39 (16 March 2017)

The court found that material irregularities occurred in the tender process. Dihlabeng Local Municipality was confused about the identity of the successful bidder, awarding the contract to Four Rivers Trading 82 CC, which did not submit a bid, and later attempting to correct this by communicating with Configen CC. The bid documentation was inconsistent and misleading, with contradictory information about the entities involved and their financial status. The municipality's decision to simply multiply a monthly bid by thirty-six months was irrational and failed to ensure equal treatment of bidders, as required by law. The process lacked fairness, transparency, and legality, and the award...

Citation
[2017] ZAFSHC 39
Parties
Applicant: Cybko Security Services CC; Respondent: Dihlabeng Local Municipality; Respondent: Four Rivers Trading 82 CC t/a Zero Tolerance Security; Respondent: Configen CC
Court
Free State High Court, Bloemfontein
Jurisdiction
South Africa
Judgment Date
16 March 2017
Case Number
A49/2016
Procedural Posture
Review Application / Judgment After Hearing on Merits
Outcome
Application granted in part; the award of the tender and related service level agreement are set aside. The municipality is directed to re-advertise the tender. Costs awarded as specified.
Judges
J.P. Daffue, S. Chesiwe
Legal Topics
Public Procurement, Tender Irregularity, Promotion of Administrative Justice Act, Doctrine of Legality, Preferential Procurement Policy Framework Act, Municipal Finance Management
Administrative Law Civil Procedure Commercial and Corporate Public Procurement Tender Irregularity Promotion of Administrative Justice Act Doctrine of Legality Preferential Procurement Policy Framework Act +1 more

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Parties

Cybko Security Services CC

Applicant

Dihlabeng Local Municipality

Respondent

Four Rivers Trading 82 CC t/a Zero Tolerance Security

Respondent

Configen CC

Respondent

Procedural Posture

Review Application / Judgment After Hearing on Merits

Legal Issues

  1. 1 Whether the tender process conducted by Dihlabeng Local Municipality complied with constitutional and statutory requirements for fairness, transparency, competitiveness, and legality.
  2. 2 Whether the award of the tender to Configen CC (or Four Rivers Trading 82 CC) was lawful and rational.
  3. 3 Whether the applicant, Cybko Security Services CC, was entitled to relief including the award of the contract or costs.

Ratio Decidendi

The court found that material irregularities occurred in the tender process. Dihlabeng Local Municipality was confused about the identity of the successful bidder, awarding the contract to Four Rivers Trading 82 CC, which did not submit a bid, and later attempting to correct this by communicating with Configen CC. The bid documentation was inconsistent and misleading, with contradictory information about the entities involved and their financial status. The municipality's decision to simply multiply a monthly bid by thirty-six months was irrational and failed to ensure equal treatment of bidders, as required by law. The process lacked fairness, transparency, and legality, and the award...

Court Disposition

Application granted in part; the award of the tender and related service level agreement are set aside. The municipality is directed to re-advertise the tender. Costs awarded as specified.

Orders

  • First respondent’s decision to award the tender to third respondent for contract MUN03/2015 is reviewed, declared unlawful, and set aside.
  • The service level agreement between first and third respondents is declared unlawful and set aside.