Siemens (Pty) Ltd v Passenger Rail Agency of South Africa (19845/2021) [2022] ZAGPPHC 587 (15 July 2022)

Siemens (Pty) Ltd v Passenger Rail Agency of South Africa (19845/2021) [2022] ZAGPPHC 587 (15 July 2022)

The court found that the applicant's claim had prescribed, as the debt became due on completion of the project on 15 December 2016 and the application was launched more than three years later. Even if prescription did not apply, the contract was invalid due to non-compliance with constitutional and statutory procurement requirements. The respondent's official lacked authority to conclude the agreement, rendering it ultra vires and unlawful. Estoppel could not be invoked to validate a contract prohibited by law in the public interest. The counter application for a declarator and review was dismissed as the matter fell within the law of contract, not administrative law.

Citation
[2022] ZAGPPHC 587
Parties
Applicant: Siemens (Pty) Ltd; Respondent: Passenger Rail Agency of South Africa
Court
North Gauteng High Court, Pretoria
Jurisdiction
South Africa
Judgment Date
15 July 2022
Case Number
19845/2021
Procedural Posture
Civil Application / First Instance Judgment
Outcome
Application dismissed with costs; counter application dismissed with costs.
Judges
N Janse Van Nieuwenhuizen
Legal Topics
Public Procurement, Prescription, Contract Validity, Ultra Vires, Estoppel, Supply Chain Management
Commercial and Corporate Civil Procedure Constitutional Law Public Procurement Prescription Contract Validity Ultra Vires Estoppel +1 more

Case Brief

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Parties

Siemens (Pty) Ltd

Applicant

Passenger Rail Agency of South Africa

Respondent

Procedural Posture

Civil Application / First Instance Judgment

Legal Issues

  1. 1 Whether the applicant's claim for payment under the contract has prescribed.
  2. 2 Whether the contract between the parties is void due to being an agreement to agree.
  3. 3 Whether the contract is invalid due to non-compliance with constitutional and statutory procurement requirements.

Ratio Decidendi

The court found that the applicant's claim had prescribed, as the debt became due on completion of the project on 15 December 2016 and the application was launched more than three years later. Even if prescription did not apply, the contract was invalid due to non-compliance with constitutional and statutory procurement requirements. The respondent's official lacked authority to conclude the agreement, rendering it ultra vires and unlawful. Estoppel could not be invoked to validate a contract prohibited by law in the public interest. The counter application for a declarator and review was dismissed as the matter fell within the law of contract, not administrative law.

Court Disposition

Application dismissed with costs; counter application dismissed with costs.

Orders

  • The application is dismissed with costs, including the costs of two counsel.
  • The counter application is dismissed with costs, including the costs of two counsel.