State Information Technology Agency Soc Ltd v Ifirm Trading and Projects (Pty) Ltd (2847/2016) [2018] ZAGPPHC 417 (15 June 2018)

State Information Technology Agency Soc Ltd v Ifirm Trading and Projects (Pty) Ltd (2847/2016) [2018] ZAGPPHC 417 (15 June 2018)

The court found that the agreement between the applicant and respondent was constitutionally invalid and unenforceable because it was not preceded by a public tender process, nor was it authorised by the applicant's board of directors. The CEO exceeded his delegated authority, and prescribed deviation procedures under Treasury Regulations and the applicant's Supply Chain Management Policy were not followed. The contract also created a future financial commitment without the required approval from the Minister of Finance under the Public Finance Management Act. The respondent was aware of the potential invalidity and did not take timely steps to enforce any rights. The facts did not...

Citation
[2018] ZAGPPHC 417
Parties
Applicant: State Information Technology Agency SOC Ltd; Respondent: Ifirm Trading and Projects (Pty) Ltd
Court
North Gauteng High Court, Pretoria
Jurisdiction
South Africa
Judgment Date
15 June 2018
Case Number
2847/2016
Procedural Posture
Review Application / Judgment
Outcome
The agreement concluded between the applicant and respondent on 21 May 2014 is declared constitutionally invalid and set aside. Costs are awarded against the respondent.
Judges
Janse van Nieuwenhuizen
Legal Topics
Public Procurement, Constitutional Invalidity, Legality Review, Enrichment Claim, Authority of Officers
Administrative Law Commercial and Corporate Public Procurement Constitutional Invalidity Legality Review Enrichment Claim Authority of Officers

Case Brief

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Parties

State Information Technology Agency SOC Ltd

Applicant

Ifirm Trading and Projects (Pty) Ltd

Respondent

Procedural Posture

Review Application / Judgment

Legal Issues

  1. 1 Whether the agreement concluded between the applicant and respondent on 21 May 2014 is constitutionally valid and enforceable.
  2. 2 Whether the applicant followed the required public procurement procedures under section 217 of the Constitution and Treasury Regulations.
  3. 3 Whether the respondent is entitled to any relief or compensation following the invalidation of the agreement.

Ratio Decidendi

The court found that the agreement between the applicant and respondent was constitutionally invalid and unenforceable because it was not preceded by a public tender process, nor was it authorised by the applicant's board of directors. The CEO exceeded his delegated authority, and prescribed deviation procedures under Treasury Regulations and the applicant's Supply Chain Management Policy were not followed. The contract also created a future financial commitment without the required approval from the Minister of Finance under the Public Finance Management Act. The respondent was aware of the potential invalidity and did not take timely steps to enforce any rights. The facts did not...

Court Disposition

The agreement concluded between the applicant and respondent on 21 May 2014 is declared constitutionally invalid and set aside. Costs are awarded against the respondent.

Orders

  • The agreement concluded between the Applicant and the Respondent on 21 May 2014 is constitutionally invalid.
  • The agreement concluded between the Applicant and the Respondent on 21 May 2014 is set aside.