Slipknot Investments 777 (Pty) Ltd and Another v Eastern Cape Liquor Board and Others (EL 861/2011, ECD 1294/2011) [2011] ZAECELLC 17 (8 December 2011)

Slipknot Investments 777 (Pty) Ltd and Another v Eastern Cape Liquor Board and Others (EL 861/2011, ECD 1294/2011) [2011] ZAECELLC 17 (8 December 2011)

The court found that the tender process conducted by the First Respondent was fundamentally flawed and tainted by procedural unfairness. The Second Respondent was deregistered at the time of tender submission, invalidating its participation. The joint venture arrangement between the Second and Third Respondents was not properly disclosed or substantiated, and preference points were improperly awarded. The Applicants were excluded from the opportunity to revise their bids, which was afforded to other tenderers, without rational justification. The lease agreement concluded between the First and Third Respondents was a product of this defective process. The principle of legality and the...

Citation
[2011] ZAECELLC 17
Parties
Applicant: Slipknot Investments 777 (Pty) Ltd; Applicant: Great Force Investments 59 (Pty) Ltd; Respondent: Eastern Cape Liquor Board; Respondent: Saneze Investments (Pty) Ltd; Respondent: Cranes Crest Investments 71 (Pty) Ltd
Court
Eastern Cape High Court, East London Local Court
Jurisdiction
South Africa
Judgment Date
8 December 2011
Case Number
EL 861/2011, ECD 1294/2011
Procedural Posture
Review Application / Final Judgment on Review
Outcome
Application granted; the tender process and lease agreement are set aside.
Judges
Beyleveld AJ
Legal Topics
Public Procurement, Preferential Procurement Policy Framework Act, Fair Administrative Action, Fronting and Tokenism, Company Deregistration, Tender Evaluation
Administrative Law Commercial and Corporate Public Procurement Preferential Procurement Policy Framework Act Fair Administrative Action Fronting and Tokenism Company Deregistration Tender Evaluation

Case Brief

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Parties

Slipknot Investments 777 (Pty) Ltd

Applicant

Great Force Investments 59 (Pty) Ltd

Applicant

Eastern Cape Liquor Board

Respondent

Saneze Investments (Pty) Ltd

Respondent

Cranes Crest Investments 71 (Pty) Ltd

Respondent

Procedural Posture

Review Application / Final Judgment on Review

Legal Issues

  1. 1 Whether the tender process for the lease of office space was conducted in a fair, equitable, transparent, competitive and cost-effective manner.
  2. 2 Whether the award of the tender to a joint venture between the Second and Third Respondents was lawful.
  3. 3 Whether the Applicants were improperly excluded from the tender adjudication process.

Ratio Decidendi

The court found that the tender process conducted by the First Respondent was fundamentally flawed and tainted by procedural unfairness. The Second Respondent was deregistered at the time of tender submission, invalidating its participation. The joint venture arrangement between the Second and Third Respondents was not properly disclosed or substantiated, and preference points were improperly awarded. The Applicants were excluded from the opportunity to revise their bids, which was afforded to other tenderers, without rational justification. The lease agreement concluded between the First and Third Respondents was a product of this defective process. The principle of legality and the...

Court Disposition

Application granted; the tender process and lease agreement are set aside.

Orders

  • The tender process relating to tender 001/2010: Lease of Office Space for Eastern Cape Liquor Board is set aside.
  • The decision of the First Respondent to award the bid to the Second and Third Respondents is set aside.