Gaydon Motor Spares (Pty) Ltd v Minister of Safety and Security and Others (5224/08) [2008] ZAKZHC 28 (11 March 2008)

IN THE HIGH COURT OF SOUTH AFRICA

NATAL PROVINCIAL DIVISION

REPORTABLE

Case no: 5224/08

In the matter between:

GAYDON MOTOR SPARES (PTY) LTD APPLICANT

Vs

MINISTER OF SAFTY AND SECURITY & 2 OTHERS RESPONDENTS

JUDGMENT

­­­­­­­­­

MADONDO J

INTRODUCTION

[1] This is an urgent application for an order in the following terms:

2.

(a) Interdicting and restraining the first respondent from procuring, alternatively further procuring, spare parts and tools for SAPS vehicles in the Provinces of KwaZulu-Natal and the Eastern Cape, except from;

(i) the applicant, in KwaZulu-Natal;

(ii) the third respondent under an existing month-to-month contract with the first respondent, in the Eastern Cape;

Interdicting and restraining the second and third respondents from supplying and delivering spare parts and tools for SAPS vehicles in the provinces of KwaZulu-Natal and the Eastern Cape (except for supplies and deliveries by the third respondent made under an existing month-to-month contract in the Eastern Cape);

pending the delivery by the first respondent of the reasons for, and the record of, and thereafter pending the final outcome of any application to be brought by the applicant (within the time limit in paragraph 4 below) for review of, a decision (“the decision) to award bid number Q19/1/9/1/45TV(07): Supply and delivery of spare parts and tools for all SAPS vehicles for a period of three years nationally in accordance with SAPS specification SAPS2456/07 (“the tender”) to the second and third respondents;

Ordering the first respondent to deliver written reasons for the decision, together with a record of the decision, to the applicant within ten days of the date of this order;

That the first respondent, jointly and severally with such other respondent(s) who oppose this application, pay the applicant’s costs;

Further or other relief.

3.

That paragraph 2(a) and (b) hereof operate as an interim interdict with immediate effect.

4.

That the applicant institute proceedings for review of the decision within twenty days of the delivery of the reasons and record, contemplated by paragraph 2(c) above, by the first respondent, failing which the interim interdict in paragraph 3 above shall lapse.

[2] The applicant is Gaydon Motor Spares (SA) (Pty) Limited, a company with limited liability duly incorporated and registered in accordance with the company laws of South Africa, which has its main administrative office at 63 Milne Street, Durban, KwaZulu-Natal. Its registered office is at 102 Essenwood Road, Durban, KwaZulu-Natal.

[3] The first respondent is the Minister of Safety and Security, cited herein in his official capacity as representative of the South African Police Services (“the SAPS”) who has his address for the purpose of service of this application at care of the State Attorney, 6th Floor, Metropolitan Life Building, 391 Smith Street, Durban, KwaZulu-Natal.

[4] The second respondent is All Parts (Pty) Limited, a company with limited liability duly incorporated and registered in accordance with the company laws of South Africa, which carries on business as a supplier of motor vehicle parts at 103 Smith Street, Durban, KwaZulu-Natal.

[5] The third respondent is Auto Parts (Pty) limited, a company with limited liability duly incorporated and registered in accordance with the company laws of South Africa, which carries on business as a supplier of motor vehicle parts under the name Autozone at 111 Mimetes Road, Denver, Johannesburg, Gauteng.

FACTUAL BACKGROUND

[6] During August 2007 the head office of South African Police Service (the SAPS) in Pretoria invited tenders for the supply and delivery of spare parts and tools for its fleet of motor vehicles throughout the Republic of South Africa (the Republic). The tender was advertised and published in the Government Tender Bulletin on 31 August 2007 under Ref Q 19/1/9/1/45TV(07). The closing date for the sub mission of tenders was 11 October 2007. However, the closing date was later extended to 11 March 2008.

[7] The tender process was regulated by the Constitution of the Republic of South Africa Act, 108 of 1996 (the Constitution), the Public Finance Management Act, No1 of 1999 (PFMA) the Treasury Regulations promulgated under the PFMA and the Supply Claim Management Guidelines and Policy. Five companies tendered for the supply and delivery of the spare parts and tools to the SAPS.

[8] The applicant only tendered for the provinces of KwaZulu-Natal and Eastern Cape respectively. The second respondent only tendered for the province of KwaZulu-Natal. The third respondent tendered for all the provinces in the Republic. Midas Group (Pty) Ltd tendered for Mpumalanga, Western Cape, KwaZulu-Natal, Free State and Gauteng. Mogwele Trading 381(Pty) Ltd tendered for Gauteng, Eastern Cape, Mpumalanga, KwaZulu-Natal and Limpopo.

[9] The awarding of the tender is not a decision of an individual. Two committees, namely; Bid Evaluation Committee (the BEC) and the Bid Adjucation Committee (the BAC) are in charge of the tender process. The BEC evaluates tenders in accordance with the mandatory requirements and evaluation criteria set out in the special conditions of the tender.

[10] The BEC, consisting of panel members, evaluated the tenders submitted by the said five tenderers in accordance with clauses 8 and 12 of the special conditions of the tender and recommended to the BAC that the second and third respondents be awarded the tender. The second and third respondents had scored the highest total points and met all the requirements of the tender.

[11] On 28 February 2008 the BAC awarded the tender to the second and third respondents, such award was published in the Government Tender Bulletin on 7 March 2008.

[12] It is the practice of the SAPS, with regard to tender process, to advertise the invitation for tenders as well as the outcome thereof in the Government Tender Bulletin. Only successful bidders are notified in writing of the acceptance of the tender. It is only in exceptional circumstances, the invitation for a tender is published in the newspapers. It was expected of the applicant to learn of the outcome of the tender process from the Government Tender Bulletin.

[13] Prior to the tender the applicant had been rendering similar services to the first respondent on two year contract which endured until 31 October 2007. In fact the contract had been awarded to Gaiete Investments (Pty) Ltd, a company in which the applicant holds 50% of the shares, by consent between the applicant and the other shareholder in Gaiete Investments (Pty) Ltd, Midway Two Contractors (Pty) ltd, the applicant performed the services required by the SAPS under the contract. After 31 October 2007 the then existing contract was extended on a month-to-month basis pending a decision on the tender.

[14] 06 March 2008 the applicant, acting through its attorney, directed a letter to Director Fourie of the SAPS, Pretoria, enquiring about the tender award. The relevant parts read as follows:

“4. Our client has heard rumours that the tender has been awarded to Autozone for all areas in South Africa, save for KwaZulu-Natal where the tender has been awarded to a company known by the name Allparts.

5. Our client has endeavoured to ascertain from your representatives whether this is in fact true and what is the current status of the matter as our client is presently providing services to you.

6. Therefore, at the outset, we ask of you the following;

6.1 has the tender been awarded or not;

6.2 to whom and for what regions has the tender been awarded.

7. If our client has not been awarded the tender in respect of the Eastern Cape and KwaZulu-Natal regions, then our client is entitled to reasons for your decision. This is in terms of the Promotion of Administrative of Justice Act No. 3 of 2000 and we ask that you comply with your obligations in terms of the act and provide our client with written reasons.

8. We also invite you to advise us whether there exists an internal appeal process for the decision in regard to the tender.

9. In terms of the Preferential Procurement Policy Framework Act No. 5 of 2000, a points scoring system is applicable in the determination of state based tenders and this is evidenced from the tender documents which you have issued in the matter.

10. Accordingly, our client needs to know:

10.1.1 what points is scored;

10.1.2 what points Autozone scored, specifically in relation to the Eastern Cape region;

10.1.13 what points Allparts scored for the KwaZulu-Natal region.

10.2 In providing the above information you must include a breakdown of the prices that each party tendered with an indication as to the nature, quality and warranties of each product that was to be supplied.

11. Our client is entitled to the above information and to access to the tenders by Autozone (for the Eastern Cape region) and Allparts (for the KwaZulu-Natal region) in terms of the Promotion of Access to Information Act, as well as in terms of several decisions of the Supreme Court of Appeal. See Transnet Ltd and Another vs SA Metal Machinery Company (Pty) Ltd 2006(6) at 285.

12. In summary we need to know who has been awarded the tender and why. We also need access to the various tenders and all the documents underpinning the tender decision.

13. Please treat as URGENT and in the interim all our client’s rights are fully reserved. “

[15] To this letter, Director MC Mogosetsie, Section Head: Bid Management, replied in a letter dated 11 March 2008 as follows:

“Please take note that the matter is receiving attention.

You will be informed of any progress made.”

[16] On 13 March 2008 the applicant, through its attorney, directed another letter, to the first respondent stating that it had seen in the Government Gazette dated 7 March 2008 that the tender for the supply and delivery of spare parts and tools for a period of three years had been awarded to the second respondent in KwaZulu-Natal and for all other provinces to the third respondent. In such letter the applicant reiterated its request for the reasons for awarding the tender to the second and third respondents, and demanded access to information relating to the points the applicant and the second and third respondents scored in the tender process, and the comparable prices tendered by the second and third respondents for the provision of the relevant services.

[17] The applicant also expressed concern that the tender award might be fundamentally flawed. As a result, the applicant asked the first respondent’s undertaking that until it is provided with the required information and satisfied itself that the award of the tender is not fundamentally flawed the contracts concluded with the second and third respondents are not implemented. Failing which, the applicant threatened within five days of its letter to approach this Court for the necessary interim relief interdicting the award of the tender.

[18] On 18 March 2008 the Sheptone and Wylie attorneys, acting on behalf of Gaiete Investment Holdings (Pty) Ltd, directed a letter to the first respondent inquiring about the then existing month to month contract between the parties. The letter reads:

“1. We act for Gaiete Investment Holdings (Pty) Ltd.

2. Our client has been performing on a month to month basis the contract to supply spare parts and tools to SAPS, which contract is subject to at least one (1) calendar months notice.

3. Our client’s have been made aware that you intend to appoint All parts (Pty) Ltd and Auto Parts (Pty) Ltd to supply spare parts and tools for three (3) years to KwaZulu-Natal and all other provisions respectively commencing April 1, 2008.

4. Our client has received no notice from you that the month to month contract will be terminated. Accordingly, our client will continue to supply spare parts and tools until the expiration of a lawful notice period of one (1) calendar month still to be received from you.”

[19] To this letter the first respondent in a letter dated 19 March 2008 responded as follows:

“Abovementioned contract expired on 2007-10-31, but was then extended on a month to month basis until a new contract is put in place.

A new contract was put in place, that will commence on 2008-04-01.”

[20] The applicant only brought this application, as an urgent application, for an interdictory relief pending the delivery by the first respondent of the reasons for and the record of its administrative action on 26 March 2008. The matter was then set down for hearing on 31 March 2008, the day on which the then ongoing month to month contracts terminated. The application was heard a day before the new contracts between the first respondent and the second and third respondents took effect. It has been argued on behalf of the applicant that this matter is urgent. However, the applicant has failed to make out a case for such urgency. It became aware of the outcome of the tender process on 7 March 2008. However, it only filed the papers with the registrar of this Court on 26 March 2008 and set the matter down for hearing on 31 March 2008. I agree with Mr Rall SC for the third respondent that the applicant should not be heard complaining of the urgency of its own creation. See also 20th Century Fox v Black Films 1982(3) SA 582(W) 586.

ISSUES

[21] All the three respondents oppose the application. It has been argued on behalf of the respondents that this Court lacks the necessary jurisdiction to entertain this application on the grounds, firstly, that all the acts relating to the tender in question were performed in Pretoria, secondly, that the applicant has failed to attach a resolution to the papers as proof of authority on its part to institute these proceedings, and, thirdly, that there has been a non joinder of all the companies, namely, Midas Group (Pty) Ltd and Mogwele Trading 381 (Pty) Ltd, which had tendered for the supply and delivery of spare parts and tools to the first respondent, and which are, therefore having a direct and substantial interest in the out come of these proceedings.

[22] It has further been argued that the applicant has failed to show that the tender was improperly awarded. Nor has it been shown that the tender award was procedurally flawed. In addition, whether the applicant has a right and whether such right has been infringed or threatened.

JURISDICTION

[23] The onus of satisfying this Court that it has the necessary jurisdiction to entertain this application rests upon the applicant. Mr Voormolen for the applicant has argued that the decision by the first respondent, as an organ of state, to award the tender to the second respondent and third respondents constituted an administrative action as envisaged by section 33(1) of the Constitution and as defined in the Promotion of Administrative Justice Act, 3 of 2000 (PAJA) and that in consequence thereof, this Court has in terms of section 1 of PAJA jurisdiction to entertain this application. PAJA was promulgated in order to give effect to section 33(1) of the constitution.

[24] I agree with Mr Voormolen for the applicant since it is now well established that a tender process implemented by an organ of state is an “administrative action” within the meaning of PAJA. See Logbro Properties CC v Beddeson N.O. and Others 2003(2) SA 460 (SCA); Chairperson: Standing Tender Com v JFE Sapela Electronics, supra.

[25] Section 1 of PAJA, which was promulgated in order to give effect, to section 33 of the Constitution reads:

“’administrative action’ means any decision taken, or any failure to take a decision, by-

an organ of state, when –

exercising a power in terms of the Constitution or a provincial constitution ; or exercising a public power or performing a public function or performing a public function in terms of any legislation; or

a natural or juristic person, other than an organ of state, when exercising a public power or performing a public function in terms of an empowering provision, which adversely affects the rights of any person and which has a direct, external legal effect …..,”

[26] In the definition section of PAJA “Court” is defined as meaning:

“(a) the Constitutional Court acting in terms of section 167(6)(a) of the Constitution; or

(b) (i) a High Court or another court of similar status; or

(ii) a Magistrate’s Court, either generally or in respect of a specified class of administrative actions, designated by the Minister by notice in the Gazette and presided over by a magistrate or an additional magistrate designated in terms of section 9A.

Within whose area of jurisdiction the administrative action occurred or the administrator has his or her or its principal place of administration or the party whose rights have been affected is domiciled or ordinarily resident or the adverse effect of the administrative action was, is or will be experienced;”

[27] This section in cases relating to the administrative action as defined in PAJA grants jurisdiction to the Court in whose area of jurisdiction the administrative action occurred. In addition, the section grants jurisdiction to the Court in whose area of jurisdiction a party whose rights have been affected is domiciled or is ordinary resident. It is common cause, in this present case, that the awarding of the tender occurred in Pretoria and as a result, the Transvaal Provincial Division is the first Court having jurisdiction in the matter. The applicant has its registered office at 102 Essenwood road of Durban, KwaZulu-Natal, and falling within the jurisdiction of this Court, and which may in the case of a natural person be equated to a residential address. It is not in dispute that the applicant has experienced the adverse effect of the decision by the first respondent in KwaZulu-Natal where it had a month to month contract with the first respondent via Gaiete Investments (Pty) Ltd and had tendered for the supply and delivery of the spare parts and tools to the first respondent. The inevitable conclusion, therefore, is that this Court also has jurisdiction in the matter. The decision by the ABC not to award the tender to the applicant, but to the second and third respondents instead constituted a direct external legal effect impinging adversely on the applicant. The applicant has elected to approach this Court for the relief sought.

[28] With regard to the absence of the resolution by the company, as proof that the applicant has the necessary authority to institute these proceedings, it is common cause that the applicant has tendered in its name for the supply and the delivery of the spare parts and tools. In the absence of the countervailing evidence, it can, therefore, legitimately be deduced there from that it has the necessary authority to institute these proceedings for the exercise or protection of its own right.

[29] The second and third respondents are joined in these proceedings as the interested parties. The second respondent also carries on business in Durban and tendered for KwaZulu-Natal province. Although third respondent does not carry on business in KwaZulu-Natal, it has tendered for all provinces throughout South Africa including KwaZulu-Natal province. All this, is also sufficient to grant this Court jurisdiction against the second and third respondents. At this stage the applicant does not challenge the tender award, but it only seeks an order directing the first respondent to provide it with written reasons for its decision not to award the tender to it. It will only after the receipt of such reasons and the record of the tender process, the applicant may decide whether or not to institute the review proceedings. In my view, the non joinder of all persons, that had tendered for the supply and delivery of spare parts and tools to the first respondent, would only become a fatal defect in the applicant’s papers if it elects to institute review proceedings.

INTERIM RELIEF

[30] The applicant seeks interdictory relief and in order to succeed, it must establish the following;

(a) a right prima facie even though open to some doubt;

(b) a well-grounded apprehension of irreparable loss if the interim relief is not granted;

(c) a balance of convenience in its favour, and,

(d) the lack of another remedy adequate in the circumstances.

See Coalcor (Cape) Pty Ltd and others 1990(4) st 349 (CPD) 353 F-H; Airodex Press (Pty) Ltd v Chairman, Local Road Transportation Board, Durban and others 1986(2) SA 663(AD) 671 I-J, 672A – BB, 678H-I; National Union of Textile Workers and Others v Stag Packings (Pty) Ltd and Another 1981 (4) SA 932(WLD) 938 B-D; De Meillon v Montclair Society of Methodist Church of Southern Africa 1979 (3) SA 1365 (D&CLD) 1370 D-E; Bhengu v Alexander 1947 (4) SA 341 (NPD)350; Pepsico. Co Inc and Others v United Tobacco Co. Ltd 1988(2) SA 334 (WLD)336J- 337H; Multi Systems (Pty) Ltd v Ponting and Others 1984(3) SA 182 (D&CLD) 186D-E.

[31] The point in issue is whether the applicant has any right and, if so, whether such right has been infringed or whether there is a reasonable apprehension of an infringement or invasion. I propose to first ascertain the existence of the right and thereafter to consider other requisites for an interdict.

(a) clear / prima facie right

[32] The applicant has to establish that a clear or prima facie right, though open to some doubt, exists upon which interdictory relief can be granted. See Omega, Louis Brandt et Frere and Another v African Textile Distributors 1982(1) SA 951(TPD) 957C-D, and Stellenbosch Wine Trust LTD and Others v Oude Meester Group Ltd and Others 1977(2) SA 221 (CPD) 235H.

[33] It is not in dispute in the present case, that the tender process (invitation, adjudication and award) amounted to an administrative action and that the applicant is therefore entitled to the protection afforded by section 33 of the Constitution. The tenderer has the right to lawful, reasonable and procedurally fair administrative action as provided for in section 33(1) of the Constitution and paragraphs (a) and (b) of item 23(2) of Schedule 6 of the Constitution. Such right comprises the right to obtain the information the applicant reasonably requires in order to enable it to determine whether its right to lawful and procedurally fair administrative action provided for in the Constitution has been violated. See Aqua Fund (Pty) Ltd v Premier of the Province of the Western Cape 1997(7) BCLR 907(C); Transnet Ltd v Goodman Brothers (Pty) Ltd 2001(1) SA 853(SCA) at p 871 paragraph 10; Inkatha Freedom and Another v Truth and Reconciliation Commission and Others 2000(3) SA 119 (CPD) 135 f-G (hereafter referred to as IFP v TRC).

[34] Item 23(2)(b) of Schedule 6 provides:

“Every person has the right to –

(a) lawful administrative action where any of their rights or interests is affected or threatened;

(b) procedurally fair administrative action where any of their rights or legitimate expectations is affected or threatened;

(c) be furnished with reasons in writing for administrative action which affects any of their rights or interests unless the reasons for that action have been made public; and

(d) administrative action which is justifiable in relation to the reasons given for it where any of their rights is affected or threatened. “

Pending the passing of legislation by the National Legislative as envisaged by ss 32(2) and 33(3) of the Constitution, item 23 of Schedule 6 provided for an interim reading of ss 33(1) and (2). As the tender has been dealt with after the passing of the envisaged legislation passed the reading does not find application, in my view, but, still is a persuasive authority.

[35] In terms of section 3 of PAJA, which was promulgated in order to give effect to section 33(1) and (2) of the Constitution, an administrative action which materially and adversely affects the rights or legitimate expectations of any person must be procedurally fair. In the present case until the applicant has been furnished with the written reasons, stating why the second and third respondents had been preferred over it, does not know whether the decision of the first respondent has been procedurally fair.

[36] Section 5(1) of PAJA, provides that any person whose rights have been materially and adversely affected by the administrative action and who has not been given reasons for the action may request the administrator to furnish reasons for the action. The request for reasons must be made within ninety (90) days from the date on which the affected person ‘became aware of the action or might reasonably have been expected to have become aware of the action’. In terms of section 5(2), the administrator is obliged, within ninety (90) days after the receipt of the request, to provide written reasons in writing for the administrative action. The furnishing of written reasons has an added advantage of enabling the affected person to assess whether or not his or her right has been infringed and therefore whether to take a particular decision on review. See Lawrence Baxter Administrative Law (1994) at 228; Transnet Ltd v Goodman Bros (Pty) Ltd, supra, at para 10.

[37] Subsection (3) of section 5 goes on to provide that if an administrator fails to furnish adequate reasons, it will be rebuttably presumed in any judicial review proceedings that the administrative action was taken without good reason. Under subsection (4) an administrator may depart from the requirement to furnish adequate reasons if it is reasonable and justifiable to do so under such circumstances. If it is so decided, the administrator must forthwith inform the person making the request of such departure.

[38] The right to written reasons only arises if a person’s “rights” have been “materially and adversely affected”. It is common cause that the applicant had together with other four tenderers tendered for the supply and delivery of spare parts and tools to the SAPS motor vehicles in KwaZulu-Natal and Eastern Cape provinces respectively. The tender was awarded to the second and third respondents. It is undeniable fact that the applicant has a right to the procedural fairness of the administrative action in question. This includes the right to be provided with written reasons and to have access to other tenders and other relevant documentation in order to assess whether its right to lawful, reasonable and procedurally fair administrative action has not been infringed.

[39] The requirement relating to the giving of the written reasons principally serves a justificatory function, explaining to the affected parties and to the public at large why a particular decision has been made.

[40] Section 32 of the Constitution provides:

“(1) Everyone has the right of access to –

any information held by the state; and any information that is held by another person and that is required for the exercise or protection of any rights.

National Legislation must be enacted to give effect to this right and may provide for reasonable measures to alleviate the administrative and financial burden on the state.”

[41] The National Legislation envisaged in section 32 (2) is the Promotion of Access to Information Act, 2 of 2000 (PAIA). This legislation provides for access to records held by both public and private bodies, and sets out the grounds on which disclosure must or may be refused and the manner in which such grounds may be overridden in the public interest, as well as mechanisms for the resolutions of disputes over access, notably judicial review. (ss11-55)

[42] Access to information is an essential and a necessary adjunct to open democracy society committed to the principles of openness, transparency and accountability (see Khala v Minister of Safety and Security 1994(4) SA 218 (W) at 225). Transparency serves the dual purpose of promoting public accountability as well as greater public participation in government. (see E Mureinik: “Reconsidering Review: Participation and Accountability (1993) Acta Juridica 35).

[43] Access to information is vital to protecting a person’s rights and interests. Vital decisions should not be taken behind closed doors on the basis of the documents which the public, including persons whose rights or interests are detrimentally affected by relevant decisions, could not have access. (see Chaskalson et al: Constitutional Law of South Africa, 2nd Edition paragraph 62-3)

[44] In ABBM Printing and Publishing (Pty) Ltd v Transnet 1998(2) SA 109 (W), the Court held that an unsuccessful tenderer was entitled to access to other tenders and other relevant documentation, in order to assess whether its rights to procedural fairness have been infringed.

[45] In IFP v TRC, supra, the IFP had requested access to relevant documentation of the TRC in order to establish whether it had a claim for defamation against the TRC, of particular relevance here was that the relevant legislation (s41 (2) of the Promotion of National Unity and Reconciliation Act, 34 of 1995) provides that persons who perform tasks on behalf of the commission may only be liable if they acted in bad faith. As a result of this statutory exclusion of liability the applicants contended that they could only assess whether they had action in law if they had sight of the relevant documentation on which the TRC based its action. At page 135 Davis J, in principle, appeared to endorse this approach, stating that the Applicants were entitled to information which would enable them to launch proceedings in an informed fashion and held:

“In the present case the question is whether information is reasonably required for the enforcement of the applicant’s rights in that, based on such information, applicants can obtain advice as to whether they have a claim and can then frame their pleadings in a manner which discloses a cause of action”.

[46] Requests for access to records must be made to information officer of the public body or the head of the private body. The relevant person must then consider the request within stipulated period and, in certain circumstances must notify affected third parties to make representations as to whether the request should be granted (ss47-49 and 71-73). If the requester is dissatisfied with a refusal of access by a department or state or administration in any sphere of government, he or she must follow the internal appeal procedure provided in PA1A – ss 74-77. In addition, a dissatisfied requester can, on application, appeal a decision to refuse access to Court (chapter 2 of part 4 – ss 78-82).

[47] In terms of section 217 of the Constitution when an organ of state contracts for goods or services, it must do so in accordance with a system which is fair, equitable, transparent, competitive and cost effective.

[48] Section 239 of the Constitution defines an organ of state as meaning:

“(a) any department of state or administration in the national, provincial or local sphere of government; or

(b) any other functionary or institution –

(i) exercising a power or performing a function in terms of the constitution or a provincial constitution; or

(ii) exercising a public power or performing a public function in terms of any legislation, but does not include a Court or a judicial officer.”

[49] It is common cause in the present case that the first respondent as the National Department of State is obliged to comply with the provisions of section 217 of the Constitution, when contracting for goods or services. Whether the tender in all respects complies with the specifications and conditions of tender as set out in the contract documents must be judged against these values. See Chairperson : Standing Tender Committee and Others v JFE Sapela Electronics (Pty) Ltd and others [2005] 4 All SA 487 (SCA) 493 paragraph 14.

[50] It has been contended on behalf of the applicant that the requirements of fairness and transparency must be interpreted so to avoid a situation whereby the first respondent is able to award contracts on tender to parties without providing reasons to unsuccessful tenderers and without affording them a proper opportunity to challenge the decision. The tender award has been made to the second and third respondents without the applicant having been notified that it had been unsuccessful. Nor has any reason been advanced as to why the applicant did not succeed. Finally, Mr Voormolen for the applicant argued that the applicant had been kept in the dark about the outcome of the tender and that that alone warrants the interim relief sought by the applicant.

[51] It is trite that where it is alleged that a constitutional right has been infringed or threatened, the aggrieved person should approach the Court for relief by way of judicial review. See Section 38 of the Constitution. Steenkamp NO v Provincial Tender Board, Easter Cape 2006(3) SA 151 (SCA) 168 para 42.

[52] An interim interdict is a Court order granted upon application preserving or restoring the status quo pending the final determination of the rights of the parties albeit in an action, an application such as a review or an appeal. It seeks to place a restraint on the future action of the respondent until final determination. See L.F. Boshoff Investments (Pty) Ltd v Cape Town Municipality 1969(2) SA 256(CPD) 267A and Mkhize v Swemmer and Others 1967(1) SA 186 (D&CLD) 192 G-H.

[53] However, such restraints must be in respect of unlawful or wrongful conduct. It is an unlawful or wrongful conduct which invades or threatens the right. See Coalcor (Cape) (Pty) Ltd and Others v Broiler Efficiency Services CC and Others, supra, at 359 F, Estates Agents Board v Lewis Locke Estates (Pty) Ltd and Another 1984(1) SA 709 (WLD)716A; Multi Tube Systems (Pty) Ltd v Ponting and Others 1984(3) SA 182(D) 186 F-G, 187I.

[54] It is the legal rights that must be in issue and not the preservation of commercial interests. See Airodex Express (Pty) Ltd v Rauch International Pipelines (Transvaal)(Pty) Ltd1984(3) SA 861 (WLD) 881 F-G. Where a temporary relief is sought pending an action, it must be specified what the proposed action will be about. If it is not specified, that is a defect in the application. However, it is not necessary that the proposed action be stated with absolute precision. It must have, however, be clear enough to inform the respondent and the Court. In the present case the applicant seeks an order directing the first respondent to provide it with the written reasons for its decision not to award the tender to it. The applicant will only after receiving such reasons decide whether to institute review proceedings.

[55] The applicant does not allege that the tender was improperly awarded to the second and third respondents. Nor has it been alleged that the tender award was procedurally flawed. However, it has alleged that the tender process was somewhat tainted with corruption. In its founding affidavit the applicant alleges that during March 2008 an employee of the SAPS telephoned and expressed unhappiness with the tender process. The said employee went on to state that a member of the SAPS connected with the tender and his family had been taken on a hunting trip to Namibia at considerable expense. The said employee had also allegedly suggested that the outcome of the tender had been improperly influenced by favours. However, the applicant does not disclose the source of such information. Nor does it know whether the information received is true and correct, let alone believing it. The source of the information and the grounds for the belief in the truth of the statement must be disclosed with a degree of certainty sufficient to enable the opposing party to make independent investigations of his own, including, if necessary, verification of the statement from the source itself.

See Cerebos Food Corporation Ltd v Diverse foods SA (Pty) Ltd and Another 1984(4) SA 149 (TPD) 157D0F; Southern Pride Fools (Pty) Ltd v Mohidien 1982(3) SA 1068(CPD) at 1072 A-B.

[56] Mr Rall SC for the third respondent has correctly pointed out that the allegations contained in paragraph 15 of the founding affidavit are hearsay and inadmissible. He argues that there are vague as to when the telephone call was made, whether the person supplying the information had any knowledge of the information conveyed (it may well be that that person him or herself was conveying hearsay information) and whether the alleged corruption related to the second and third respondents.

[57] I agree with Mr Rall SC for third respondent that for the hearsay evidence relied upon in the affidavit to be accepted, the deponent must state that he believes the evidence to be true. In such a case, however, he is required to set out in full the facts upon which he bases the grounds for his belief and how he obtained the information. Where a deponent includes in his affidavit facts in respect of which he does not have knowledge, he may annex a verifying affidavit by a person who does have knowledge of those facts. In interlocutory matters where urgency or other special circumstances appear to justify its doing so, the Court has allowed the deponent to state that “he is informed and verily believes” certain facts on which he relies for relief.

See Galp v Tansely N.O. and Another 1966(4) SA 555 (C) at 558H-559A; Johnstone v Wildlife Utilisation Services (Pty) Ltd 1966 (4) SA 685 (R); Steyn v Schabort en Andere N.N.O 1979(1) SA 694(O) at 699G-H; Charimonitz v Charimonitz (1) 1960(4) SA 818(c).

[58] If the deponent to an affidavit sets out statements made by other persons without indicating whether he believes them or not, those statements are inadmissible and will, on application, be struck out. Premier Produce Co. v Mavros 1931 (WLD)91, Southern Pride Tools (Pty) Ltd v Mohidien, supra. However, the Court is not obliged to accept hearsay evidence if the source and the grounds for belief in it are furnished, but has a discretion to do so. See Yogarimi Maritime Construction Co. Ltd v Nissho – Lival Co. Ltd 1977(4) SA 682(c) at 692 B-D.

[59] Section 3 (1)of the Law of Evidence Amendment Act, 45 of 1988 permits a Court to admit evidence when the Court is of the opinion that it is in the interests of justice to do so, having regard to the nature of the proceedings, the nature of the evidence, the purpose for which the evidence is tendered, the probative value of the evidence, is not given by the person upon whose credibility the probative value of the evidence depends, any prejudice to a party that the admission of the evidence might entail, and any other factors that should in the opinion of the Court be taken into account.

See also Herbstein & Van Winsen; The Civil Practive of the Supreme Court of South Africa, 4ed p370.

Nor has the applicant advanced any valid reason for concluding that it is in the interest of justice to admit the hearsay evidence contained in paragraph 15 of its founding affidavit. The applicant has not disclosed any meaningful basis for such allegations and they are, therefore struck out as hearsay evidence and inadmissible.

[60] The Court has to determine whether the conduct complained of is unlawful or wrongful. The applicant is in terms of section 6(1) of PAJA entitled to institute proceedings in a Court for the judicial review of an administrative action on various grounds as set out in subsection 2 of the section which are inter alia; that the administrator who took the decision was not authorized to do so by the empowering provision; was biased or reasonably suspected of bias, the action was procedurally unfair, the action was taken for an ulterior purpose or motive, in bad faith or arbitrarily or capriciously; irrelevant considerations were taken into account or relevant considerations were not considered, or that the action itself contravenes a law or is not rationally connected to the purpose for which it was taken or the information before the administrator or the action is otherwise unconstitutional or unlawful. The applicant has not sought any reliance on any of the grounds referred to in subsection 2. Instead, it only seeks the written reasons for preferring the second and third respondents over it.

[61] In terms of section 7(2)(a) the applicant must first exhaust internal remedies before instituting review proceedings. In the present case, the applicant does not know whether there are any internal remedies which need to be exhausted. The applicant has 180 days from the day the proceedings instituted in terms of internal remedies as contemplated in subsection 2, if there are any, have been concluded. Where no such remedies exist, 180 days is calculated from the date the applicant was informed of the administrative action, became aware of the action and the reason for it or might reasonably have been expected to have become aware of the action and the reasons, (s7(1)(a)(b)). The applicant became aware of the administrative action on 7 March 2008 and still have ample opportunity to institute review proceedings. It has to ascertain first whether it needs to exhaust internal remedies. In terms of section 7(2)(c) the applicant may apply for exemption from the obligation to exhaust any internal remedy if the Court deems it in the interest of Justice. Nor has the applicant applied for such exemption.

[62] The Court in the proceedings for judicial review in terms of section 6 (1) may grant any order that is just and equitable, including order directing the administrator to give reasons or to act in the manner the court requires; prohibiting the administrator from acting in a particular manner, declaring the rights of the parties in respect of any matter to which the administrative action relates and granting a temporary interdict or other temporary relief (58(1)(a)(b)(d)and (e)).

[63] The right to institute the judicial review proceedings arises where the propriety of the administrative action is challenged on the basis inter alia, that it was biased or reasonably suspected of bias; was procedurally unfair or was taken in bad faith or arbitrarily capriciously, it is unconstitutional or unlawful and on many other grounds as set out in section 6(2) of PAJA. The applicant has not raised any of the grounds referred to above. However, it seeks the order directing the first respondent to provide it with the written reasons for its decision to award the tender to the second and third respondents and the record of the tender process within ten (10) days of the date of the order sought as well as the temporary relief pending the provision of such reasons and the record. Secondly, an order directing the applicant to institute review proceedings within twenty (20) days of the delivery of the reasons and the record. The applicant is only entitled to do so under judicial review proceedings.

[64] Under section 5 of PAJA the right to institute review proceedings by any aggrieved person arises when the administrator has failed to furnish adequate reasons in writing within the period the administrator is required to give such reasons, (ss3). In such event, the administrator shall be deemed to have refused to furnish the required reasons. Secondly, where the administrator has refused to furnish the requested reasons and gives reasons for such refusal or acceptance of a particular tender which are unjustifiable in relation to the provisions of the constitution and legislation providing such right. See Transnet Ltd case, supra, Chairperson; Standing Tender Com v JFE Sapela Electronics, supra. None of the events referred to above has occurred in the present case.

[65] In terms of section 9(1)(a) the court may on application by the person concerned reduce the prescribed ninety (90) day period referred to in section 5. Nor has the applicant applied for the reduction of the period in question. The decided cases holding that the right to a lawful, reasonable and procedurally fair administrative action, also consists of the right to obtain the information the affected person reasonably requires in order to determine whether his or her right to lawful and procedural fair administrative action provided for in the constitution has been infringed, namely; Aqua Fund (Pty) Ltd v Premier of the Provincie of Western Cape; Tansnet Ltd v Goodman Brothers (Pty) Ltd, and IFP v TRC supra, are not the authority for the circumvention of the provisions of PAJA governing the institution of judicial review proceedings.

[66] The applicant requested the first respondent to furnish it with written reasons and other documentation on the 6th March 2008. At the time of the hearing of this application, thirty (30) days had hardly elapsed from the date of such request. The first respondent has not refused to furnish such reasons and documentation, but it responded on 11th March 2008 saying that the applicant’s request was still receiving attention. It was the BEC and BAC which had been in charge of the tender process. Instead of requesting the chairperson of the BAC as the information officer of the body which actually awarded the tender to the second and third respondents, the applicant addressed the request to Director Fourie of the SAPS, who had nothing to do such with a tender process. In any event the response by the first respondent was, in my view, too prompt.

[67] Noting that the first respondent is a massive establishment, it needs adequate time to collate all the necessary information and relevant documentation and it has not failed to do so before the expiry of the prescribed period. It is, therefore, proper to assume that the ninety (90) day period was fixed in order to afford an organ of State or anybody requested to furnish reasons adequate opportunity to do so. Allowing the applicant to circumvent the provisions relating to the institution of the judicial review proceedings, will definitely open a floodgate of applications of this nature, which are brought prematurely, devoid of any merits.

[68] Nor has the applicant succeeded to show that it is entitled to approach the Court for an order compelling the first respondent to furnish it with the requested reasons and the record. The relief the applicant sought is in terms of the provisions of section 8(1)(2) of PAJA only available under judicial review proceedings.

(b) irreparable harm

[69] The purpose of the temporary interdict is to ensure that pending a full investigation by the Court the wrong complained of should not be committed or continued.

See Bress Designs (Pty) Ltd v G.Y Lounge Suite Manufactures (Pty) Ltd and Another 1991(2) SA 455 WLD 461A-C; SAB Lines (Pty) Ltd v Cape Tex Engineering Works (Pty) Ltd 1968(2)SA 535 (CPD) 537D-F.

[70] Where the applicant seeks interim relief in order to protect its immediate interests, it must show prima facie that its rights have been infringed and that it will suffer real loss. Where there is a clear right the injury must be irreparable to justify the granting of an interdict. However, where the right asserted though prima facie established is open to some doubt, an actual or well grounded apprehension of irreparable loss or infringement of rights must be proved.

See also L.F. Boshoff Investments (Pty) Ltd v Cape Town Municipality 1969(2) SA 256 (C)at 276C.

[71] The second requirement for the granting of an interdict is an act of interference with the rights of the applicant, on the part of the respondent, or a reasonable apprehension that such an act will be committed. In the present case the applicant contends that the SAPS is on the verge of concluding agreements with the second and third respondents to render services referred to in the tender with effect from 1 April 2008. Should the applicant not move for the interim relief, the second and third respondents are likely to take over the rendering of services. If they do this, it will seriously impinge on any attempt by the applicant to obtain interim relief. However, the applicant must on the established facts show any grounds for its entertainment of such apprehension.

[72] In order to succeed the applicant must show that it has valid grounds for its fears. The Court is not found by its fears. The applicant has not demonstrated as to how the continuance of the contracts between the first respondent and the second and third respondents affects its right, as an unsuccessful tender, to written reasons. The applicant has not alleged that the tender award was improperly made or that it was procedurally flawed. Had it made such allegations, the continuance of such contracts would have an effect of validating a possibly invalid contract. This will be sufficient to show an act of interference with the rights of the applicant on the part of the respondents.

[73] Suspension of the operation of the contracts entered into between the first respondent, on one hand, and the second and third respondents, on the other hand, would not in any way advance or protect the applicant’s rights to written reasons and the record of the tender process. The second and third respondents have already concluded contracts with the first respondent. The contract between the first respondent and the third respondent, for instance, was concluded on 10 March 2008 and between the first respondent and second respondent on 13 March 2008 respectively. The month to month contracts, which existed prior to 31 March 2008, ceased on 31 March 2008. In the circumstances, I agree with Mr Rall SC for the third respondent that the relief the applicant purports to seek against the respondents has been overtaken by events.

[74] In the absence of the mention of an act actually committed by the respondent showing an interference with the exercise of the alleged rights possessed by the applicant, or that there exists any well-grounded apprehension that acts of the kind will be committed by the respondent, one of the necessary requisites entitling the applicant to an interdict is wanting.

See Bok v The Transvaal Gold Exploration & Land Co. (1883) SAR 75 at 76; Berman v Purcell and Others 1921 CPD 415 at 420.

[75] In the present case applicant has not sufficiently demonstrated that unless the application for an interim relief is granted, irreparable damage to it will ensue except commercial loss. The only loss the applicant stands to suffer is out-of-pocket expenses, the applicant incurred when preparing the tender and the costs for bringing this application. This, clearly shows that this application is not brought for the exercise or protection of the applicant’s right but purely for the protection of its commercial interests. Nor has the applicant shown a well grounded apprehension that any real injury will be committed should the contracts in question be allowed to continue.

[76] The onus resting upon an applicant, is to establish that there exists an actual or well-grounded apprehension of injury. The apprehended loss need not be of a pecuniary nature. A person making an application for an interdict must show that he is likely to sustain some injury directly and of irremediable character. Such loss must be of actual nature. Where damage is purely hypothetical, as in the present case, the interdict is not granted.

See Condé Nest Publications Std v Jaffe 1951(1) SA 81(C) at 86 E-H; Monis Wineries Ltd v Mouton (1996) (2) SA 89 (SWA) at 94 C-D; Mcilongo N.O. v Minister of Law and Order and others 1990(4)SA181(E) at 186D-E.

(c) balance of convenience

[77] The Court must weigh the prejudice the applicant will suffer if the interim interdict is not granted against the prejudice to the respondent if it is. If there is greater prejudice to the respondent, an interim interdict is refused.

See Crossfield & son Ltd v Crystallizers Ltd 1925 WLD 316 at 223; Minnaar v Oberholzer Liquor Licencing Board & Another 1955(1) SA 681 (T) at 684 A-B; Olympic Passenger Service (Pty) Ltd v Ramlagan 1957(2) SA 382(D) at 384H- 385A.

[78] The exercise of the discretion by the Court in the granting of an interdict or other wise, usually resolves itself into a consideration of the prospects of success and the balance of convenience; the stronger the prospects of success, the less the need for such balance to favour the applicant; the weaker the prospects of success, the greater the need to favour him. See Johannesburg Consolidated Investments Co. Ltd v Mitchmor Investments (Pty) Ltd 1971(2) SA 397 (W) at 404 C-E; Eriksen Motors Ltd v Protea Motors, Warrenton & Another 1973(3) SA 685 (A) at 691 C-E; Johannesburg Municipal Pension Fund v City or Johannesburg 2005(6) 273(W) 280H-I; Ladychin Investments v South African National Roads Agency 2001(3) SA 344(N) 356-35.

[79] The applicant has in its founding affidavit failed to demonstrate that it will suffer any injury, except losing a tender, if the interim relief is not granted. It only alleges that “it has been kept in the dark” about the outcome of the tender and that that on itself justifies the granting of an interim relief sought. I find no merit in this contention by the applicant since the outcome was published in Government Bulletin as early as 7 March 2008. The applicant has not demonstrated on what basis the fact that it has not been notified by the first respondent of the outcome of the tender process in writing, is a ground for granting an interim relief.

[80] The applicant’s founding affidavit does not show that there has been any actual contract existing between the first respondent and the applicant. Instead, the evidence establishes that the contract had in fact existed between the first respondent and Gaiete Investments (Pty) Ltd in which the applicant holds 50% of the shares and the applicant provided services to the first respondent via the latter. The Court can not therefore create a contract for the parties.

[81] It is apparent from the papers that the prejudice the respondents might suffer by the suspension of the operation of the contracts, already concluded, far outweighs the right of the applicant to the written reasons for preferring the second and third respondents over it. The third and second respondents concluded contracts with the first respondent on 10 March 2008 and 13 March 2008 respectively. Such contracts had to take effect on 1 April 2008 and they have expended substantial sums of money in preparation for performance in terms of the contracts. The interdicting and restraining of the first respondent from procuring services from the second and third respondents has the potential of creating enormous and serious disruption to the repairing and servicing of the firs respondent’s fleet of motor vehicles. All the month to month contracts terminated on 31 March 2008. The havoc which might be caused by interim interdict on the service of the first respondent may, in turn, threatens the safety of the State since it would not have vehicles which are in a good working condition when discharging police duties. In the circumstances, I am satisfied that the balance of convenience favours the respondents. The applicant is indecisive as to whether it would in fact later institute the review proceedings. Nor has it demonstrated any prospect of success of such contemplated review proceedings. In any event, uncertainty still lurks in that the decision whether or not to institute judicial review will entirely be dependent on the reasons to be furnished.

(d) other adequate remedy

[82] An adequate remedy is available to the applicant through a judicial review of the administrative action. In terms of section 6(1) of PAJA read with the provisions of s38 of the Constitution a person who is adversely affected by an administrative action must institute review proceedings (s6(1)of PAJA). The judicial review proceedings provide the most usual form of ordinary remedy. It is only in the proceedings for judicial review the Court must grant an order directing the administrator to give reasons prohibiting the administrator from acting in a particular manner (58(1)(b)(i)(ii)and (d). It is not competent for this Court to order the first respondent to furnish reasons for its decision to award the tender to the second and third respondents in the absence of the evidence that the first respondent has refused to furnish reasons or has refused to furnish reasons on grounds which are inconsistent with the provisions of the constitution and of the legislation affording a right to lawful and fair administrative action.

CONCULSION

[83] In terms of section 6(1) of PAJA read with the provisions of section 38 of the constitution, a person who has adversely been affected by an administrative action may approach the Court for a judicial review of an administrative action and the Court may on the grounds set out in subsections (2) and (3) review the action. In terms of section 38 the affected person must allege that his or her right has been infringed or threatened.

[84] The applicant has not taken that route but instead, it seeks an order compelling the first respondent to provide it with written reasons, for preferring the second and third respondents over it, and the record of the tender process. The applicant will only decide after assessing the information received whether or not to institute judicial review proceedings contemplated in section 6 of PAJA. Nor has it alleged that the tender was improperly awarded or that it was procedurally unfair.

[85] For the applicant to succeed on its application, it must show that the first respondent has refused or failed to furnish the written reasons within the prescribed ninety (90) day period (s5(2) of PAJA). If reasons have been provided, it must show that the reasons furnished for refusal are not consistent with or justifiable in relations to the relevant provisions of the constitution or legislation governing the right to a lawful and fair administrative action. In its papers, the applicant has failed to show that any of the events referred to above, has taken place and, thereby justifying its application for an order compelling the first respondent to provide reasons in writing.

[86] This application is characterised by an acute lack of an act of interference with the applicant’s right to written reasons on the part of the respondents. Nor has the applicant demonstrated how the continuance of the contracts, concluded between the first respondent and the second and third respondents respectively, would affect its right to written reasons.

[87] The applicant has not shown at all that it stands to suffer any irreparable harm should the interim relief sought not be granted. To the contrary, evidence has shown a potential of serious disruptions being caused to the transport service of the first respondent if the application is granted, which may impact negatively on the execution of police duties, and, ultimately on the safety of the country. More so, the applicant has not even remotely shown any prospects of success, if it decides to institute review proceedings after receipt of the required written reasons. In the premises, the balance of convenience favours the respondents.

[88] The adequate and normal remedy available to the applicant for the relief sought is the judicial review sanctioned by the provisions of PAJA. Having properly considered all the circumstances relevant to the case as well as the argument by the counsel of the parties, I come to the conclusion that this application has prematurely been brought without any substance. The applicant has therefore not made out a case for the relief sought. Nor has it laid any proper basis for an application of this nature. Since no merits can be found in the present application, it is bound to fail. Costs must follow the results.

ORDER

[89] In the result the following order is made:

Application is dismissed with costs on attorney and client scale and such costs to include the costs consequent upon the employment of a senior counsel.

Judgment reserved on: 31 March 2008

Delivered on: 11 March 2008

Counsel for Applicant: Adv Voormolen

Instructed by: Shepstone & Wyle

REF: A.F Donnelly/SFCP/ns/GAYD5.83

Counsel for 1st Respondent: Adv Mbongwa

Instructed by: State Attorneys

REF: Q19/1/9/1/45TV(07)

Counsel for 2nd Respondent: Adv Ramdhani

Instructed by: Ajit Sevraj & Ass.

Counsel for 3rd Respondent: Adv Rall SC

Instructed by: Stowell &Co

REF: P.L.Firman/cn