Icon Construction (Pty) Ltd v Dihlabeng Local Municipality and Others (A90/2015) [2015] ZAFSHC 205 (10 September 2015)

Icon Construction (Pty) Ltd v Dihlabeng Local Municipality and Others (A90/2015) [2015] ZAFSHC 205 (10 September 2015)

The court found that the Municipality's decision to award the tender to Sinethemba was procedurally unfair and unlawful. Sinethemba did not possess the required CIDB grading at the closing date for bids, and the Municipality's acceptance of post-closing documentation contravened the peremptory requirements of the bid documents and procurement legislation. The submission of an incorrect BBBEE certificate and the failure to conduct a risk analysis further rendered the process irregular and unfair. The court rejected the Municipality's reliance on the CIDB Regulations to justify its actions, finding that such interpretation would undermine the integrity of the tender process and prejudice...

Citation
[2015] ZAFSHC 205
Parties
Applicant: Icon Construction (Pty) Ltd; Respondent: Dihlabeng Local Municipality; Respondent: Gridon Trading CC t/a Sinethemba Construction; Respondent: Udumo 26 (Pty) Ltd t/a Ultimate Dynamic; Respondent: Esor Construction (Pty) Ltd
Court
Free State High Court, Bloemfontein
Jurisdiction
South Africa
Judgment Date
10 September 2015
Case Number
A90/2015
Procedural Posture
Review Application / Judgment After Hearing on Merits
Outcome
Application succeeded; Municipality's decision set aside and directed to re-advertise the tender.
Judges
S Naidoo, C Reinders
Legal Topics
Promotion of Administrative Justice Act, Municipal Supply Chain Management, Tender Irregularity, Preferential Procurement, Construction Industry Development Board, Judicial Review
Administrative Law Civil Procedure Promotion of Administrative Justice Act Municipal Supply Chain Management Tender Irregularity Preferential Procurement Construction Industry Development Board Judicial Review

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Parties

Icon Construction (Pty) Ltd

Applicant

Dihlabeng Local Municipality

Respondent

Gridon Trading CC t/a Sinethemba Construction

Respondent

Udumo 26 (Pty) Ltd t/a Ultimate Dynamic

Respondent

Esor Construction (Pty) Ltd

Respondent

Procedural Posture

Review Application / Judgment After Hearing on Merits

Legal Issues

  1. 1 Whether the Municipality's award of the tender to Sinethemba was lawful and procedurally fair.
  2. 2 Whether Sinethemba met the mandatory CIDB grading requirements at the closing date for bids.
  3. 3 Whether the acceptance of post-closing documentation by Sinethemba rendered the process unfair.

Ratio Decidendi

The court found that the Municipality's decision to award the tender to Sinethemba was procedurally unfair and unlawful. Sinethemba did not possess the required CIDB grading at the closing date for bids, and the Municipality's acceptance of post-closing documentation contravened the peremptory requirements of the bid documents and procurement legislation. The submission of an incorrect BBBEE certificate and the failure to conduct a risk analysis further rendered the process irregular and unfair. The court rejected the Municipality's reliance on the CIDB Regulations to justify its actions, finding that such interpretation would undermine the integrity of the tender process and prejudice...

Court Disposition

Application succeeded; Municipality's decision set aside and directed to re-advertise the tender.

Orders

  • The Municipality's decision to award the tender to Sinethemba is set aside.
  • The matter is referred back to the Municipality to re-advertise the invitation to bid for the works within 30 days, should it decide to proceed with the works.