Superintendent-General: North West Department of Education and Another v African Paper Products (Pty) Ltd and Others (M282/14) [2014] ZANWHC 29 (24 October 2014)

IN THE NORTH WEST HIGH COURT

MAFIKENG

CASE NO.: M282/14

In the matter between:

SUPERINTENDENT-GENERAL: NORTH WEST

DEPARTMENT OF EDUCATION...........................................................................................First Applicant

MEMBER OF THE EXECUTIVE COUNCIL FOR

NORTH WEST DEPARTMENT OF EDUCATION..........................................................Second Applicant

and

AFRICAN PAPER PRODUCTS (PTY) LTD.......................................................................First Respondent

PALM MANUFACTURERS (PTY) LTD.........................................................................Second Respondent

AFROPULSE 46 T/A POWER STATIONERY..................................................................Third Respondent

RAPTOSCORE (PTY) LTD................................................................................................Fourth Respondent

EPILITE 390 JV......................................................................................................................Fifth Respondent

EZEKIEL 37 JV......................................................................................................................Sixth Respondent

IMPALA STATIONERY...................................................................................................Seventh Respondent

SOLUXION STATIONERY................................................................................................Eighth Respondent

KUTU STATIONERS JV......................................................................................................Ninth Respondent

BOSELE STATIONERY (PTY) LTD..................................................................................Tenth Respondent

DISANG TRADING AND PRODUCTS.........................................................................Eleventh Respondent

SERVICE SUPPLIER & EBENER TRADING JV........................................................Twelfth Respondent

BOSELEBOSA & FREEDOM STATIONERY JV.....................................................Thirteenth Respondent

CHEKKAT AGENCIES................................................................................................Fourteenth Respondent

ITERELENG STATIONERY MANUFACTURERS....................................................Fifteenth Respondent

JABATHA PAPER & STATIONERY...........................................................................Sixteenth Respondent

NORTH WEST LITHO PRINTERS.........................................................................Seventeenth Respondent

COPY CENTRUM.........................................................................................................Eighteenth Respondent

KWENA MOKONE TRADING...................................................................................Nineteenth Respondent

FREEDOM STATIONERY (PTY) LTD......................................................................Twentieth Respondent

LEKUKA INVESTMENT.........................................................................................Twenty-First Respondent

PRILLEX POWER JV..........................................................................................Twenty-Second Respondent

BOSELE POWER JV...............................................................................................Twenty-Third Respondent

GOLDEN ERA JV..................................................................................................Twenty-Fourth Respondent

KGOELE J

DATE OF HEARING: 28 AUGUST 2014

DATE OF REASONS : 24 OCTOBER 2014

FOR THE APPLICANT : Adv. SJ.R. Mogagabe SC (With Him Adv. K. Chwaro)

FOR 1st RESPONDENT : Adv. A.J. Kemp SC (With Him Adv. H Gani)

FOR 2nd RESPONDENT : Adv. H.J. De Waal

FOR 3rd RESPONDENT : Adv. M. du Plessis SC (With Him S. Pu difin-Jones)

FOR 20th RESPONDENT : Adv. D Unterhalter SC (With Him A Boule)

REASONS FOR JUDGMENT

A. INTRODUCTION

[1] This is an application for judicial review by the first and second applicants (the Department) against its own decision to award a tender for the provision and delivery of stationery within the North West Province for the period 2015-2017 to the first and second respondents (“African Paper” and ‘'Palm”). The Department seeks to review its own decision on the grounds that the process that culminated in the award of the tender was improper, irregular, unlawful and invalid and in contravention or not in line with the legislative prescripts regulating public procurement to procure goods or services as required by Section 217 of the Constitution of the Republic of South Africa Act 108 of 1996 (the Constitution), read with the provisions of the Public Finance Management Act of 1999 (PFMA) and the Promotion of Administrative Justice Act of 2000 (PAJA). The application is opposed by the first and second respondents. The third and twentieth respondents suppo rt the application.

B. FACTUAL BACKGROUND

[2] The Department is responsible for providing all learner and teacher support material, inclusive of stationery, to all public schools throughout the North West Province. In order to comply with this duty, in November 2013, the Department invited tenders for the provision and delivery of stationery to distributors within the North West Province for a three-year period (2015-2017) under bid number EDU 34/13NW, and a briefing session was held on 13 December 2013.

[3] In terms of the bid documents, the Department adopted the evaluation criteria of 90/10 preference point system, to wit: 90 points being allocated for price and 10 points being allocated for Broad Based Black Economic Empowerment (BBBEE) status. The evaluation and adjudication process was undertaken by the Department’s Bid Evaluation Committee (“BEC”) and the Bid Adjudication Committee (“BAC”).

[4] Bids closed on 16 January 2014 and the bid submissions were publicly opened and read out on the same day. Twenty-four bids were received from the first to the twenty-fourth respondents;

[5] The bids were analysed in three stages: The first stage related to bid “administrative requirements”, whereby each bid was checked for compliance with the formal aspects of the tender (including, importantly for this case, the provision of a valid BBBEE certificate). Only if the bid was administratively compliant, did the bid proceed to the next stage of the evaluation;

[6] The second stage related to “functionality” This analysis included aspects such as relevant experience, project plan and locality of the bidder. Each of these aspects was allocated a mark, which in total made up 55 marks. In order to progress to the third stage, a bidder was required to obtain 70% of the 55 marks (i.e. 39 marks); and

[7] The third stage, which consisted of a site inspection, in terms of which warehouse facilities, conditions of employment, transport and staff complement were inspected. Again, only those bidders who met the threshold of 70 points were entitled to proceed to the next stage.

[8] Thereafter, those bidders who had passed the three stages of bid analysis progressed to the final stage. These qualifying bids were subjected to the 90/10 evaluation criteria, where 90 points were allocated for the lowest price tendered for the first year and 10 points for BBBEE compliance.

[9] Following the said evaluation process, the BEC allocated/scored first respondent the highest point totalling 98.00 and second respondent, the second highest with 77.48 points. It then recommended the award of the tender to first respondent at the price of R553.92 for the District of Dr Ruth Segomotso Mompati and to second respondent at the price of R680.18 for the District of Bojanala and Dr Kenneth Kaunda.

[10] In May 2014 the BAG endorsed the recommendations of the BEC and further sent the matter to the first applicant in his capacity as Head of Department (HOD). The first applicant approved the appointment of the first and second respondents on 28 May 2014. Subsequent to the award of the tender, the first and the second respondents were informed of the first applicant’s decision through letters of appointment, the acceptance of which constituted a binding contract which both accepted.

[11] Following concerns raised by some of the officials within the Directorate: Supply Chain Management, the Department instituted these proceedings. On the 28th August 2014 the parties argued a preliminary point which centred around the issue of whether the other respondents, being the third, and twentieth respondents, who were supporting the application by the Department albeit on different grounds/irregularities than those that were contained in the Department’s founding affidavit, should be entertained or not in the same application. This Court issued the following order/ruling on the 29 August 2014 after hearing submissions from ail the parties concerned who were present in Court.

“1. The application in Case No. M282/14 stands or falls with the applicant’s case within the four corners of its review grounds made out in its founding affidavit.

2. The third (3) and the twentieth (20) respondents may use their answering affidavits in support of their stance in this matter, hut cannot go outside or use other grounds which are outside the factual case for review or the review grounds made by the applicants in their founding affidavit.

3. The application by the twentieth (20) respondent for this Court to receive and consider its further supplementary affidavit filed on the 25 August 2014 is hereby dismissed

4. The costs occasioned by the adjudication of these preliminary issues are to be paid by the first and second applicants, including third and twentieth respondents, jointly and severally, the one paying the other to be absolved, such costs to include the costs of employment of two counsels”.

[12] On the 12th of September 2014 the main application was argued in this Court. After hearing all the parties, the following order was consequently

issued by this Court on the 18 September 2014:-

“1. It is declared that the process of awarding the First and Second Respondents tender No. EDU 34/13 NW: Provision and delivery of stationery to distributors within the Department of Education, North West Province, for a period of three years, was improper, irregular, unlawful and invalid.

2. The award to First and Second Respondents of the said tender No. EDU 34/13 NW: Provision and delivery of stationery to distributors within the Department of Education, North West Province, for a period of three years is hereby reviewed and set aside.

3. The contracts concluded by the Department of Education, North West Province and the First and Second Respondents respectively, pursuant to the award of tender No. EDU 34/13 NW: Provision and delivery of stationery to distributors within the Department of Education, North West Province, for a period of three years are declared null and void ab initio and of no force and effect.

4. The decision to award tender number EDU 34/113 NW: Provision and delivery to distributors within the Department of Education, North West Province for a period of three years, is referred back to the Department of Education North West Province to start de novo.

5. The Department of Education, North West Province must ensure that the whole process to award the afore-mentioned tender must be completed within a period of six (6) months from the date of this order.

6. A new and independent Bid Evaluation Committee and Bid Adjudication Committee must be appointed to evaluate and adjudicate the new tender process.

7. Pending the decision of the Department of Education in the North West Province to award a new tender after completion of the tender process ordered in paragraphs 4,5 and 6 above, the Department of Education is authorized to take interim measures that it deems fit within the realm of the powers vested in them and/or prescripts to ensure that the requisite stationery is delivered timeously to learners falling within the North West Province Department of Education, prior to the next school year in compliance with the Department’s obligation to provide basic learning services to learners in schools falling within the Department of Education, North West Province.

8. The interim measures taken in paragraph 7 above will remain in force until the new tender process has been completed. ”

[13] It is important to indicate at the onset that the need to consider the urgency of this matter fell away because all the parties to this application seemed to appreciate the urgency of the matter and the catastrophic consequences which may flow from the delayed deliveries of the stationery to the learners.

B. THE IRREGULARITIES THAT MARRED THE TENDER PROCESS

[14] The application by the Department is anchored on the irregularities briefly outlined below.

Ad first respondent

[15] The first respondent (African Papers) together with its bid submitted a BBBEE Certificate dated 18 December 2012 which expired on the 17 December 2013. The BBBEE Certificate was accompanied by a letter obtained from Empowerdex dated 17 December 2013 which indicated that Empowerdex was engaged to perform a broad based economic empowerment rating to African Paper and that the verification process was to be undertaken in future.

[16] The Department submissions are that when the submissions of the bids closed on the 16 January 2014, the first respondent had no valid BBBEE Certificate. The letter of Empowerdex also does not help them as it did not indicate when the exercise of performing a broad based economic empowerment rating would be undertaken.

[17] The Department argued that, the evaluation criteria set by it, especially with regard to phase one, being the administrative compliance stage, outlined that a submission of a valid BBBEE Certificate was amongst others, a criterion that bidders would be considered against as to whether they are responsive or non-responsive. In the premises, the first respondent ought to have been disqualified by the BEC when it evaluated all bidders against administrative compliance and in accordance with the evaluation criteria. According to the Department, the decision by its BEC not to disqualify the bid of the first respondent and to proceed to evaluate its bid as compliant and furthermore, allocate preferential points to it amounts to an irregularity which is reviewable in accordance with one or more of the grounds contained in Section 6 (2) of PAJA.

[18] The Department in addition requested this Court to declare the contracts it concluded with the first and the second respondents to be invalid and order the tender process to be submitted for re-consideration by it.

[19] The twentieth respondent (Freedom) supports the application by the Department that the tender process be referred for re-consideration but with the following rider, that the first and second respondents be excluded from the reconsideration. Counsel for the twentieth respondent submitted that it is necessary to exclude both because if the tenders had properly been assessed then, they would already have been excluded at the administrative compliance stage. According to him it would be futile to permit them to remain in contention given the fact that their exclusion is a foregone conclusion and because time is of essence, it would be in the public interest to do so.

[20] On the other hand, whilst the third respondent (Power Stationery) supports the application of the Department as well, its counsel

submitted that the process has to be started de novo because the fairness of the process has been ruptured irredeemably by the inherent, material, substantive and procedural defects within the tender process.

[21] The first respondent response to all the submissions made above is to the effect that a BBBEE Certificate has as its purpose, the preferring of the bids of those who contribute to BBBEE objectives by means of a ready points determining mechanism. It does not contemplate wasteful expenditure or disqualification for a failure or inability to claim such bonus points. According to the first respondent’s counsel, all bidders do not have to contribute and the certification assists those who contribute in getting more points. It is required to ensure that points are not undeservingly given for BBBEE.

[22] The first respondent submitted further that the Department did not treat the BBBEE composition of any tenderer as a qualification, it treated it as a point scoring part of the award otherwise, the first respondent submitted, its conduct, would have been unconstitutional and illegal. According to the first respondent the Department now seeks to enforce an interpretation contrary to what it had in mind.

[23] According to the first respondent’s counsel the requirement of a BBBEE certificate being a document to be submitted is not to be read as a self-standing provision. It must be read with the other provisions of the tender and the statutory provisions governing tenders and establishing the 90/10 system. Therefore, he argued, that the best value for money in the sense of the price in money terms for the procured performance is an integral cornerstone of public procurement.

[24] He further contended that the 90/10 system prescribed by the National legislation and the Regulations thereunder, simply cannot be read as creating a system which sets a BBBEE component of a bidder, as a qualifying as opposed to a preferential dictate. The Treasury Directives and Guidelines is clear to the effect that non-compliant tenderers should not be excluded.

[25] It is the submission of the first respondent that the Department makes no attempt herein to deal with its contention that it would indeed have been unlawful under the 90/10 system to disqualify bidders who do not have a BBBEE component and that such system is inimical to such qualification requirement. Nor does the Department explain why its tender document contains provisions which are in obvious conflict with a BBBEE component serving as a gatekeeper function in respect of the bids. The first respondent’s counsel view is that by postulating BBBEE certification as an administrative prerequisite for qualification as a tenderer, the Department has now closed off the Provincial tender process to the public on racial lines and certification whether BBBEE is claimed or not.

[26] Lastly the first respondent submitted that the applicant’s case is indeed destructive of the 90/10 points system. It seeks to set aside its own award to a bidder which has put in a bid which in terms thereof, will save the tax payer tens of millions of rand compared with that of the unsuccessful bidders, especially the third and twentieth respondents.

[27] As an alternative to the above the first respondent argues that the Court has a wide discretion not to set aside the tender award by the Department even if it was flawed (which according to it was not).

[28] In support of this contention counsel for the first respondent submitted that it is clear that the best value for money for the stationery principle and certainty of timeous supply for scholars supports the current award being implemented. According to him the outcome of the challenge is simply designed to exclude the best value and highest scoring tender by many points, representing tens of millions of Rand even without any BBBEE points, of a company which indeed is a level 3 BBBEE contributor, and should get the 8 points given, but which did not have the certificate covering the duration at the moment the tender closed.

[29] He further argued that the challenges to the current award are not of great substance and therefore immaterial. According to the first respondent’s counsel, setting aside the award will also not advance the BBBEE goals or preference ordained. The outcome inevitably (despite defects) would be that the first respondent and second respondents are the winners. The Department in any event, did not prove that the tender process would have seen any different outcome than the first respondent being the successful tenderer as the highest scorer and reflecting the best value for money. The interest of the learners and their parents and all taxpayers will by far be better served by simply implementing the award.

Ad second respondents

[30] The irregularity besetting the bid of the second respondent (Palm Stationery) according to the Department is to the effect that immediately a day after the bid closing date, which was 16 January 2014, a representative of the second respondent sent a letter for the attention of Mr Keate and which was received by the Department on 17 January 2014. The contents of the said letter relate to the alleged error and/or honest mistake in respect of the calculation of the total bid price submitted with the bid of the second respondent.

[31] The Department further alleges that it is apparent from the bid document submitted by the second respondent that its original total bid price was an amount of R3 333-56 and that the amendment sought through a letter of 16 January 2014 and an e-mail of 18 January 2014, as admitted by the second respondent, was going to amend and/or alter the total bid price to an amount of R1 718-91. The amendment and/or alteration were allowed by its officials despite being impermissible in terms of the tender law.

[32] The Department contended that the best practices, norms and standards which find application in procurement processes eschew a practice where alterations and/or changes to bid documents are allowed to be made, especially after the closing date of tenders as this amounts to an improper, irregular, invalid and unlawful conduct.

[33] In addition, the Department argues that the alteration and/or changes to the bid document of the second respondent was not even brought to the attention of the members of the BEC by the relevant line functionary and/or Mr Keate, as Chairperson of BEC, after having received the letter from the second respondent. This much is confirmed by Messrs Gill and Sefanyetso, both members of the BEC who are of the firm view that such a practice is not allowed.

[34] According to the Department, the conduct of some members of the BEC to accept and withhold pertinent information pertaining to the alteration and/or changes made to the total bid price of second respondent and proceeding to evaluate its bid as if there were no changes made after the closing date amounts to an improper, irregular, invalid and unlawful conduct which is susceptible to be reviewed and set aside in accordance with one or more of the grounds of review contained in Section 6(2) of PAJA.

[35] The second respondent (Palm) response to these submissions is that the letter they wrote merely drew the attention of the Department to the arithmetic error made in the adding of the unit prices in its tender document. In short, the respondent says, it was pointed out to the Department that if one adds up the unit prices quoted in Section 21 of its bid document, then one arrives at a total bid price of R1718-87and not R3 333-56 as (incorrectly) inserted in the tender document. The second respondent pointed out that this was due to a human and honest error. The unit prices were according to the second respondent correct but the incorrect total was inserted.

[36] In addition, the second respondent submitted that it annexed a spreadsheet to the answering affidavit, which demonstrated, beyond any doubt, that the unit prices quoted in Section 21 - (pricelist in its bid) was not changed and that if these are added up the total amount is in fact R1 718. The correction of the error did not change the competitive position of other bidders or the substance of what second respondent offered. Such corrections according to its counsel are permitted. He further contended that indeed, the Department was obliged to correct the arithmetic error itself. It is not contrary to the Constitution or any procurement legislation tor these corrections to be made. He referred in this regard to an unreported judgment of the Western Cape High Court in the matter of Loliwe CC t/a Vusumzi Environmental Services v City of Cape Town and Others (3791/2012) [2012] ZAWCHC 162 (6 July 2012) at paragraphs 32 to 35 ) as a basis for this submission.

[37] But there is another reason why the first review ground must fail, he submitted, both the BEC and the BAC has now confirmed under oath that they never saw the letter of 16 January 2014. The letter was accordingly never taken into consideration in awarding the tender and falls to be disregarded as irrelevant.

[38] Finally he submitted, it must be borne in mind that the second respondent’s price is far lower than the prices of third and twentieth respondents. In all the circumstances, and for the reasons set out above, he submitted that, this Court should exercise the discretion that it has in review proceedings, and refuse to set aside the award made to second respondent, even if it founds that there have been material irregularities in the tender process.

SABS certificates and revised stationery prices

[39] The Department solicited SABS information together with revised pricing information from the then remaining bidders when it had already excluded other bidders on other grounds. With the revised pricing, the Department had omitted the required measurements of certain items which necessitated the request for revised prices, following proper specification of measurements. As far as the SABS Certificate is concerned, it was not at all specified as a requirement in the tender conditions.

[40] The Department submitted that the decision by the BEC to request some of the bidders to submit SABS Certificates despite such certificate not having been made part of the evaluation criteria and/or returnable documents that were certainly spelt out in the tender documentation renders the entire bidding process to be suspect and amenable to be reviewed and set aside.

[41] Further that the bid which was issued by the Department was incomplete and therefore vague in the sense that during the process of evaluation, the BEC requested pricing on supplementary items that were never specified in the original bid documents from short-listed bidders only.

[42] According to the applicant both conduct by its officials offends against the principles enunciated in Section 217 of the Constitution especially fairness, transparency and openness, which are the hallmark of public procurement.

[43] The Department submitted that the above irregularities are at odds with the prescriptive nature of public procurement and the dicta found in the matter of Choice Decisions v MEC Department of Development, Planning and Local Government, Gauteng 2003 (6) SA 308 (W) at paragraph 12 where in the Court stated the following:

“It is in the public interest that officials comply diligently with regulations and other directives, especially when those directives

have in mind the attainment of transparency and accountability and the prevention of corrupt practices”

[44] The Department further submitted that the failure by the BEC and BAC to strictly adhere to the requirements of the tender documents, especially relating to the matters outlined above, rendered the entire process procedurally unfair, inequitable, non-transparent and noncompetitive and thus flawed.

[45] The first respondent reply to the SABS Certificate issue is to the effect that no party was excluded from evaluation as a result of SABS approval certificate. It further submitted that these certificates were not even used in the tender awards and did not affect the tender process and the outcome in any material manner. In as far as the revised prising issue is concerned no submission was made by it.

[46] The second respondent re-iterated the first respondent submissions in as far as the issue of the SABS Certificate is concerned. On the issue of the revised prising, it submitted that there is nothing unlawful and untoward about this given the fact that all the shortlisted bidders were given an opportunity to re-price this section and further that, the competitiveness of the process was not affected as the first and second respondent only adjusted their pricing upward to comply with the instruction, but still they were lower than the other shortlisted bidders.

Non-disclosure of the legal opinion

[47] The Department procured an opinion from a counsel regarding, the lawfulness and integrity of the tender process and the award of the tender. According to it, this opinion was procured prior to the finalization of the evaluation process and following concerns having been raised by officials within the Directorate: Supply Chain Management.

[48] The submission by the Department is that the fact that the officials of the Department who had sight of that legal opinion requested never disclosed it to members of the BEC, the BAC and the Department in itself constitute an irregularity that impacted on the proper decision making by the said committees. As it is evident from the confirmatory affidavits of Gill, Sefanyetso and Moiema, if the said legal opinion or its existence was disclosed before the respective committees, such committee would have taken a different decision in respect of the recommendation of first respondent’s products.

[49] The first respondent submitted firstly that the status of the legal opinion is indeed an opinion and inadmissible furthermore because it is hearsay evidence.

[50] Secondly that, the Department only relied on the BBBEE aspect in the “Opinion”. It took no issue with this assertion from the first and second respondents and its case was and is confined to the BBBEE certification issue. This is in line with the jurisprudence. He quoted the case of National Council of the SPCA v Openshaw [2008] ZASCA 78; 2008 (5) SA 339 (SCA) as a support for this submission. As to this legal opinion, the second respondent is noticeably silent in both its heads and its answering affidavit.

[51] In addition to the request that the tender award be set aside, the Department submitted that in the event of the administrative act which culminated in the award of the tender to first respondent and second respondent being set aside and reviewed, it ipso facto follows that the contract so concluded between the parties cannot survive as they flowed from an invalid administrative act(s) as outlined above. Furthermore, same cannot be enforced as it is contrary to public policy to enforce a contract based on an invalid administrative act. As such having regard to the doctrine of illegality the contracts having been concluded in consequence of an unlawful administrative action cannot on the principle of legality be allowed to stand or be enforced. As such they should be declared invalid and of no force and effect.

Ad other irregularities raised by third and twentieth respondents and third party notice application including all interlocutory proceedings related thereto

[52] There were other irregularities that were raised by the third and twentieth respondents in their answering affidavit in addition to their support to the application by the Department that the tender process should be set aside which were not raised by the Department in its founding affidavit, that culminated to the ruling made by this Court on 29 August 2014. I am of the view that nothing further should be said about them because firstly, the order is self-explanatory and secondly, they did not affect the outcome of this judgment.

[53] The same applies to the third party application by third applicant (Power) and the resultant interlocutory proceedings by other respondents. The third party notice in my view was an attempt to get around the ruling that Í made on the 29th which preceded it and the fifth third party (Freedom) from going outside or using other grounds which were outside the factual case for review or the review grounds as made by Department (in the main application) in their founding affidavit.

[54] In the result, I decline to consider all of the above mentioned issues on the basis presented by the respective applicants therein.

C. THE LAW

[55] The proper legal approach to cases of this nature was enunciated in the leading case of AllPay Consolidated Investment Holdings (Pty) Ltd and Others v Chief Executive Officer, South African Social Agency, and others 2014 (1) SA 604 (CC), (herein after referred to as AllPay 1) as follows:-

(a) The suggestion that ‘inconsequential irregularities’ are of no moment conflates the test for irregularities and their import, hence an as independent of the outcome of the tender process.

(b) The materiality of compliance with legal requirements depends on the extent to which the purpose of the requirements is attained.

(c) The constitutional and legislative procurement framework entails supply chain management prescripts that are legally binding.

(d) The fairness and lawfulness of the procurement process must be assessed in terms of the provisions of the Promotion of Administrative Justice Act.

(f) The remedy stage is where appropriate consideration must be given to the public interest in the consequences of setting the procurement process aside.

[56] In paragraph 56 of the same judgment the Constitutional Court expanded on the proper approach to the remedy and remarked as

follows:-

“Once a finding of invalidity under PAJA review grounds is made, the affected decision or conduct must be declared unlawful and a just and equitable order must be made. It is at this stage that the possible inevitability of a similar outcome, if the decision is retaken, may be one of the factors that will have to be considered. Any contract that flows from the constitutional and statutory procurement framework is concluded not on the state entity’s behalf, but on the public’s behalf. The interests of those most closely association with the benefits of that contract must be given due weight. Here it will be the imperative interest of grant beneficiaries and particularly child grant recipients in an uninterrupted grant system that will play a major role. The rights or expectations of an unsuccessful bidder will have to be assessed in that context”.

[57] Procurement law is prescriptive precisely because the award of public tenders is notoriously prone to influence and manipulation. See: Dr J S Moroka Municipality and Others v Betram (Pty) Limited and Another (937/2012) [2013] ZA SCA 186.

[58] The rationale of disqualification on the grounds of administrative compliance is recognised internationally. See: Carswell Government and Judicial Review (1988) page 99 wherein the following was said:-

"Another practice required by the fair treatment concept is that of rejecting bids which are not responsive to the specifications, or do not comply with other mandatory requirements of the tender call. If this is not done other bidders may be unfairly prejudiced by their own reliance on the terms as originally set out”

[59] The Constitutional Court in ALLPAY 1 supra held:

“Given the central and fundamental importance of substantive empowerment under the Constitution and the Procurement and Empowerment Acts, SASSA’s failure to ensure that the claimed empowerment credentials were objectively confirmed was fatally defective. It is difficult to think of a more fundamentally mandatory and material condition prescribed by the constitutional and legislative

procurement framework than objectively determined empowerment credentials. The failure to make that objective determination fell

afoul of s 6(2){b) of PAJA (non-compliance with a mandatory and material condition) and s 6(2)(e)(iii) failure to consider a relevant

consideration.”

[60] The Supreme Court of Appeal has held in Metro Projects CC v Klerksdorp Local Municipality 2004 (1) SA 16 (SCA) at paragraph 13 that:-

“It may in given circumstances be fair to ask a tenderer to explain an ambiguity in its tender; it may be fair to allow a tenderer to correct an obvious mistake; it may, particularly in a complex tender, be fair to ask for clarification or details required for its proper evaluation. Whatever is done may not cause the process to lose the attribute of fairness or, in the local government sphere, the attributes of transparency, competitiveness and cost-effectiveness.”

“In the present case, what in effect occurred is that Nolitha’s tender, with the iatter’s written consent, was adjusted by the reallocation of an amount over-quoted for one, or rather two items, to ‘most of the remaining maintenance items for installations A-P for which Nolitha had under-quoted. The effect was apparently to convert a tender from one regarded by the engineer as unbalanced and a financial risk to one which was acceptable. But the offer made by Nolitha, as embodied in its tender, was not the one ultimately accepted. What was accepted was in truth an offer that was made on 7 November 2003, some two months after the closing date for tenders, in my view this was enough to strip the tender process of the element of fairness which requires the equal evaluation of tenders, it follows that the acceptance of the Nolitha tender and the award of the contract were correctly held by the Court a quo to be reviewable.” (Emphasis added).

[61] The Constitutional Court in the case of Njongi v MEC Department of Welfare Eastern Cape, [2008] ZACC 4; 2008 (4) SA 237 (CC) paragraph 56 page 260 held:-

“It is always open to the Provincial Government to admit without qualification that an administrative decision had been wrongly taken

and consequently to expressly disavow that decision together. Indeed government at every level must be and, if found to be wrong, to admit this without qualification and to disavow reliance on them”.

[62] Bolton in his book “The Law of Government Procurement in South Africa, 2007 edition, at page 182 paragraph 2.4 said the foiiowing:-

“Tenderes prepare their tenders based on the specifications laid down in a call for tenders. As a general rule, therefore an organ of state should not be allowed to make changes to tender specifications after a call for tenders has been advertised. It is in the interest of fairness and transparency (and also competitiveness for organs of state to abide by the tender specifications initially provided”

[63] In paragraph 2.6 of the same book the learned author remarked:-

“Allowing tenderers to amend or withdraw their tenders after submission has the potential to defeat the requirements of fairness and transparency. It is important therefore, for strict rules to govern the amendments and withdrawal of tenders.

[64] Lastly in paragraph 3.1.1 he remarked:-

“The PFMA Regulations provide that tender documentation must ‘include evaluation and adjudication criteria, including the criteria

prescribed in terms of the [Procurement Act] and the Broad-Based Black Economic Empowerment Act, 2003 (Act No. 53 of 2003) (BBBEEA).

This clearly goes a long way in ensuring fairness and transparency in government procurement procedures. The pre-disclosure of tender evaluation and adjudication criteria enables contractors to make informed decisions as to whether or not they are in a position to tender and enables all contractors to prepare and submit responsive tenders. It also ensures that organs of state do not apply criteria that are unknown to contractors and facilitates the monitoring of the procurement process. The criteria specified by organs of state can be said to create a legitimate expectation on the part of contractors that tenders will be evaluated and adjudicated in accordance with the criteria specified”.

D. APPLICATION OF FACTS TO THE LAW

[65] The crux of the argument before this Court only revolves around the issue whether there were irregularities in the tender process as alleged by the Department and furthermore, whether the said irregularities were material to vitiate the tender process.

[66] The Department’s first contention as far as these irregularities are concerned is that the first respondent should have been disqualified because its BBBEE Certificate was not current. The first respondent does not dispute that its BBBEE Certificate was not current but contends that a BBBEE claim is for preference purpose and not qualification in a tender process. Further that if first respondent were given 0/10 its bid had still to be accepted as the best score by far.

[67] In terms of regulation 10(2) of the Preferential Procurement Regulations no. 34350 published on the 8 June 2011, tenderers other than Exempted Micro Enterprises (EMES) must submit their original and valid BBBEE status level Verification Certificate or a certified copy thereof, substantiating their BBBEE rating. This presupposes that submission of a valid BBBEE is a requirement that need to be satisfied by tenderers and is peremptory. These regulations are applicable nationally. [My own emphasis]

[68] In support of his argument first respondent’s counsel referred this Court to the implementation guide issue by the Chief Director: Norms and Standards of the Department of National Treasury wherein in 12.2 it has been indicated that “A bid must not be disqualified from the bidding process if the bidder does not submit a certificate substantiating the BBBEE status level of contribution or is a non-compliant contributor” Such a bidder will score 0 out of the maximum points for BBBEE.

[69] This reference unfortunately does not assist the first respondent at all. Firstly, these are mere guidelines for implementing the PPPFA and have no force of law. Secondly, according to the specifications of this tender which is in issue which are found on page 2,3 and 4 of the record of the proceedings provided by the Department, Stage 1 A: Administrative Compliant Evaluation Criteria requires a BBBEE Certificate. In page 4 thereof the Department categorically indicated that, “Any bidder that does not comply with the above-mentioned criteria will be eliminated from the evaluation process and will not be considered for further evaluation”.

[70] Whether the guidelines by the said Chief Director is at odds with the above mentioned tender specification is neither her not there. The fact remains that those were the specifications which the bidders for the tender which is the subject matter of the issue before this Court were to be evaluated upon in the first stage for bidders to continue to the next stage, which stage was even far from the preference point allocation stage.

[71] It must also be indicated that although the tender document the Department issued did not specify that the BBBEE Certificate to be submitted had to be valid, I am of the view that it will not be absurd to imply that the aforesaid specifications still required that the BBBEE Certificate submitted should be valid. Absent such implication, the requirement to submit a BBBEE Certificate would be meaningless. It is furthermore important to emphasise that there is nothing onerous or harsh in excluding a tenderer for failing

administrative compliance specifications. A failure to comply with prescribed conditions would result in a tender being disqualified as an “acceptable tender” unless those conditions are immaterial, unreasonable or unconstitutional See: Dr J.S. Moroka Municipality Case already quoted above.

[72] The first respondent contends that a verification agency, Empowerdex, issued the first respondent with a letter confirming certification until 17 March 2014. Contrary to what is alleged by the first respondent the letter does not confirm certification until 17 March 2014 or at all. It simply records that the first respondent had contracted Empowerdex to perform BBBEE rating, that the first respondent had submitted initial information and that a verification visit would be performed soon. It is plain from the letter that Empowerdex had not yet performed the verification. The letter cannot, on any interpretation, constitute an extension of the validity of the certificate the first respondent attached hereto. Even if one ignores the terms of that letter, the letter itself would not assist the first respondent because the tender documents did not provide for the recognition of any letter of extension”. A valid certificate was required.

[73] The invitation to bid included two pages headed “Administrative Compliance” along with a sub-heading “Invalidity of Bids.” Underneath the heading “Invalidity of Bids” appears a list of conduct or omissions that would result in the invalidity of a bid, within the rubric of administrative compliance. Such conduct included “Provision of incorrect or misleading information .”

[74] The first respondent submitted an invalid BBBEE documentation as aforesaid. In my view the first respondent must have known of the deficiency in the expired certificate and thus put up the so-called letter of extension. It follows that the first respondent must (or ought reasonably to) have been aware that the letter of extension did not extend the validity of its BBBEE certificate. However, at page 417 of the record of proceedings the first respondent answered “Yes" to the question “Has a BBBEE status level verification certificate been submitted?” and then indicated that the verification certificate had been issued by a verification agency accredited by the South African Accreditation

System. Conspicuously, there was no frank disclosure that the actual certificate had expired and the first respondent relied on the letter. At page 418 of the record, a representative of the first respondent signed the declaration including the content aforesaid.

Further, at page 431 -432 of the record, the first respondent’s representative signed a declaration that, according to it, it had a BBBEE status of 3 which translated to 8 points.

[75] In terms of regulation 13 of the Preferential Procurement Regulations of 2011 there are sanctions if the BBBEE status level of contribution has been claimed or obtained on a fraudulent basis against the tenderer. This concept is not foreign to interactions between organs of the state and the public. Tax collection relies largely on the honesty and accuracy payer’s tax submissions. Given the volume of the tenders that are submitted, time constraints and availability of personnel, the importance of the requirement to submit accurate reliable and honest information, must be understood in this context.

[76] In casu, the first respondent as correctly submitted by the twentieth respondent submitted incorrect or misleading information without specifically

drawing pertinent issues to the Department’s attention regarding its BBBEE Certificate. What compounds this matter further

is the fact that, as depicted in the record of the proceedings the Department submitted, the first respondent went to an extent of claiming 8 preferential points, which points were ultimately awarded by the tender committee and used in awarding the first respondent the tender. This is grossly irregular in my view. The argument by the first respondent’s that, the BBBEE Certificate’s purpose is only for preference points and not for elimination purpose is under the circumstances clearly misguided.

[77] In AllPlay 1 case the following was said in paragraph 70:

“Despite this failure, SASSA did not call on Cash Paymaster to substantiate its claimed empowerment credentials, presumably because by that stage the preference points could not have affected the outcome. This effectively made the consideration of empowerment an empty shell, where preference points were calculated as a formality but where the true goal of empowerment requirements was never given effect to”.

As indicated in the above quote, preference points are not calculated for a mere formality. They are an essential requirement to give effect to the empowerment requirements as required by the Constitutional substance transformative imperatives. Under the Constitution, the Procurement and Empowerment Acts, substantive empowerment is given and is regarded as a central and fundamental importance.

[78] This irregularity is in my view fatal to the decision taken by the Department because it indicates that the Department’s official ignored a relevant consideration when it adjudicated the tender in violation of section 6(2)(e)(iv) of PAJA and / or further that, the Department’s decision was not rationally connected to the information before the decision maker, which amounted to violation of section 6(2)(f)(ii)(cc) of PAJA.

[79] The effect of the irregularity is further heightened because it also appears that the officials of the Department were aware of the first respondent’s non-compliance with the tender document, but nevertheless chose to ignore this and to continue to evaluate first respondent during the various stages and ultimately to award a part of the tender.

[80] The proper assessment of BBBEE credentials is a jurisdictional fact which had to be objectively present before the tender could lawfully be made. Non-compliance with this jurisdictional fact vitiates the decision. See: Paola v Jeeva NO and others [2003] ZASCA 100; 2004 (1) SA 396 (SCA) at paras 14-16.

[81] Furthermore, as indicated in AllPay 1 case, there is an obligation on the Department to ensure that the empowerment credentials of the prospective tenderers were investigated and confirmed before the award was finally made. There is then even greater obligation for the tender administration to confirm the empowerment credentials of the winning bidder. It is clear that the committee that evaluated and finally recommended the tender did not do this. In AllPay 1 the following was said in paragraph 72 which I find apposite in this matter.

“Given the central and fundamental importance of substantive empowerment under the Constitution and the Procurement and the Empowerment Acts, SASSA’s failure to ensure that the claimed empowerment credentials were objectively confirmed was fatally defective. It is difficult to think of a more fundamentally mandatory and material condition prescribed by the constitutional and legislative

procurement framework than objectively determined empowerment credentials. The failure to make that objective determination fell

afoul of Section 6(2)(b) of PAJA (non-compliance with a mandatory and material condition) and Section 6(2)(e)(iii) (failure to consider a relevant consideration”.

[82] There is another reason why the argument by the first respondent does not have merit. Firstly, it ignores the approach that was enunciated in AllPay 1 Case: “who would or would not have won the tender is a wrong question at the stage when the assessment of the materiali ty of the irregularity is concerned, the right question is whether the process was fair, and or corrupted\ and it if was then all tenderers were prejudiced"'

[83] Secondly, their argument is that the end excuses the means. It is an argument that was raised directly and repeatedly by the winning tenderer (CPS) in the AllPay 1 case (in an effort to cling to its unlawful contract). It was an argument firmly rejected by the Constitutional Court in these passages under the telling heading of "(a) Fairness and lawfulness independent of result”

“[23] To the extent that the judgment of the Supreme of Court of Appeal may be interpreted as suggesting that the public interest in procurement matters requires greater caution in finding that grounds for judicial review exist in a given matter, that misapprehension must be dispelled. So too the notion that even if proven irregularities exist, the inevitability of a certain outcome is a factor that should be considered in determining the validity of administrative action.

[24] This approach to irregularities seems detrimental to important aspects of the procurement process. First, it undermines the role procedural requirements play in ensuring even treatment of all bidders. Second, it overlooks that the purpose of a fair process is to ensure the best outcome; the two cannot be severed. On the approach of the Supreme Court of Appeal, procedural requirements are not considered on their own merits, but instead through the lens of the final outcome. This conflates the different and separate questions of unlawfulness and remedy. If the process leading to the bid’s success was compromised, it cannot be known with certainty what course the process might have taken had procedural requirements been properly observed.

[25] Once a ground of review under PAJA has been established there is no room for shying away from it. Section 172(1)(a) of the Constitution requires the decision to be declared unlawful. The consequences of the declaration of unlawfulness must then be dealt with in a just and equitable order under section 172(1)(b).[19J Section 8 of PAJA gives detailed legislative content to the Constitution’s "just and equitable” remedy.

...

[27] There is a further consideration. As Corruption Watch explained, with reference to international authority and experience, deviations from fair process may themselves all too often be symptoms of corruption or malfeasance in the process. !n other words, an unfair process may betoken a deliberately skewed process. Hence insistence on compliance with process formalities has a three-fold purpose: (a) it ensures fairness to participants in the bid process; (b) it enhances the likelihood of efficiency and optimality in the outcome; and (c) it serves as a guardian against a process skewed by corrupt influences.”

[84] It is therefore clear that the overreaching requirements that the bids be subjected to proper scrutiny was not complied with and the decision of the Department is reviewable in terms of Section 6(2) of PAJA.

[85] The irregularity relied upon by the Department in this application as regards the second respondent is that it unilaterally changed the total price of its bid after the closing date of the tenders and after the respective bid prices were openly read out in public on the 16 January 2016.

[86] The second defendant does not dispute the changing but claim it was just correcting the error that it made about the total price, which according to it the Department could have easily done. The argument by the second respondent that what was done did not result in second respondent getting any advantage cannot be sustained. For the bid prices to be opened on the same date of the closing of the tenders and reading the amount out in public has a purpose which in my view is to promote transparency, openness and fairness. If the prices shown to the public can be changed after this process willy nilly, without other bidders being informed about that, at worse, the other members of the bid adjudication and/or evaluation committee, the fairness and transparency of the whole process will be tainted. This is what actually happened in this case. The award to the second respondent was based on the changed total price.

[87] The Loliwe judgment relied upon by the second respondent’s counsel can be distinguished from the facts of our case. Firstly the arithmetic

correction involved in Loliwe was just a simple correction which involved the calculation of the rate per lift quoted by the applicant in that matter. Secondly, in the Loliwe matter the evaluation committee did this arithmetic calculation for Tedcor (one of the tenderers). The learned judge reasoned, “if they could do that in respect of one bidder, why could they not do it with the applicant who raised this issue in that matter”.

Thirdly, the irregularity was not like in our matter, the changing of the bid amount previously shown to the public, but (1) an omission to insert the total estimate of the monthly costs in providing services, (2) an omission again of including an amount in respect of kilograms per lift. Changing is more onerous than insertion after an omission has occurred. The second respondent’s submissions equally do not have merit.

[88] The irregularity besetting all the tenderers is to the effect that for the Department to request; (a) shortlisted tenderers to submit SABS Certificate when this was not stipulated to be a requirement in the bid document; (b) shortlisted tenderers to re-price their stationery, clearly shows that vagueness and uncertainty about what was required from the tenderers. The Department says these are material irregularity when the first and second respondent says, the two had no effect on the evaluation of the tender as none of the bidders were excluded for not submitting the SABS Certificate and furthermore, the re-pricing did not affect any competitiveness of the whole process. Their argument is that the rankings still remain the same as a result the issue is a red herring and should be disregarded.

[89] This argument of the first and second respondent lose sight of the fact that once a quantity is belatedly introduced like it happened in this case, it will obviously have a bearing on the price. It therefore becomes crucial that all tenderers must be given an opportunity to compete on such an important thing like price. This is systematic to the tender process.

[90] Unfortunately the problem does not end there. The conduct by the Department in both regards is a clear indication that the tender was vague. A vague tender violates section 217 of the Constitution. In Minister of Social Development and Others v Phoenix Cash ‘n Carry PmB CC [2007] 3 All SA (SCA), in paragraph 2 the Supreme Court of Appeal held that:

“Without attempting a comprehensive survey of the circumstances which will offend against s 217(1) [of the Constitution] certain general observations are demonstrated as true by the fact of the present case -(1) A tender process which depends on uncertain criteria lends itself to exclusion of meritorious tenderers and is opposed to fairness among tenderers, and between tenderers and the public body which supposedly promotes the public weal;” [My own emphasis]

[91] In AllPay 1 the Constitutional Court reiterated that vague tender documents are unlawful. Froneman J held (for a unanimous court):

[87] Vagueness and uncertainty are grounds for review under section 6(2)(i) of PAJA. Certainty in legislation and administrative action has been linked to the rule of law. In New Clicks, this Court made the connection between the two and clarified where vagueness would fall as a ground for review in PAJA:

“It seems to have been assumed by the parties, and in my view correctly so, that vagueness is a ground for review under PAJA. Although

vagueness is not specifically mentioned in PAJA as a ground for review, it is within the purview of section 6(2)(i) which includes as a ground for review, administrative action that is otherwise ‘unconstitutional or unlawful’. This Court has held that the doctrine of vagueness is based on the rule of law which is a foundational value of our Constitution. In Affordable Medicines this Court explained the doctrine in the following terms:

‘[L]aws must be written in a clear and accessible manner. What is required is reasonable certainty and not perfect lucidity. The doctrine of vagueness does not require absolute certainty of laws. The law must indicate with reasonable certainty to those who are bound by it what is required of them so that they may regulate their conduct accordingly’.”

[88] There is another, related concern with the clarity of administrative action: vagueness can render a procurement process, or an administrative action, procedurally unfair under section 6(2)(c) of PAJA. After all, an element of procedural fairness - which applies to the decision-making process - is that persons are entitled to know the case they must meet.

These remarks are apposite to this matter

[92] As far as the legal opinion is concerned, it is quite obvious that the stance that the Department took stems from it. 1 am of the view that it is unnecessary to consider this issue as the irregularities already dealt with above are sufficient enough to vitiate the tender award accordingly.

E. CONCLUSION

[93] It is clear from the above analysis that the tender process in this matter was vitiated by fundamental flaws which permeate almost every level of the process from the invitation to bid, the bids themselves, ex post facto amendments to the terms of the tender, the procedure and the ultimate evaluation and adjudication of the bids. What this Court is now confronted with is a rather transparent effort by the first and second respondents, whom the tender were awarded to, to cling to the tender award, come what may. There is also now an unseemingly amount of finger-pointing between other respondents as well as seen from the various interlocutory application which this Court had to deal with time and again, as to whose tender should or should not have been accepted on account of varying suggestions about what were or were not the terms of the tender All of this at the same time confirms and ignores the obvious reality: that this Court cannot allow the tender to stand and further, cannot remit the existing tender for reconsideration (as the Department and the 20th (twentieth) respondent contend).

[94] Our jurisprudence in this regard is settled and clear as articulated by the Constitutional Court in the AllPay 1 matter above that: “if this Court is satisfied on anyone of the review grounds raised by the Department, it must set aside the award of the tender - there is “no room for shying away from it”

[95] The duty to set aside the award is highlighted by the cumulative defects in the process. In this matter several grounds of review have been identified, any one of which, if upheld, would be sufficient to set aside the decision. However, it has been recognised that a Court is entitled to have regard to the cumulative effect of a series of irregularities. It would plainly be appropriate for this Court to do so here.

[96] Furthermore, as correctly submitted by the third respondent, because of the inherent, material, substantive and procedural defects within the tender process, the fairness of the process has been ruptured irredeemably. This means that the process has to be restarted and all those that tendered need to be afforded a fair and proper opportunity to put in new bids under a revised and clarified invitation to tender.

[97] During the submissions the first respondent urged this Court to use its discretion not to set aside the tender award even if it finds that it was flawed. The proposition is supported by the second respondent, albeit on different reasons, being that it had already manufactured all the stationery and it is ready to be used. Indeed the Court enjoys the discretion to decline to set aside the award of the tender on the ground of practical exigency. See: AllPay Consolidated Investment Holdings (Pty) Ltd and Others v Chief Executive Officer of the South African Social Security Agency and Others 2014 (4) SA 179 (CC) paragraph 30-31 (herein after referred to as ALLPAY 2).

[98] However, this discretion does not arise where the non-compliance relates to requirements enacted in the public interest, such as BBBEE requirements, the duty to provide accurate information and the like -See: paragraph 18 of the case of Dr J.S. Moroka Municipality quoted above.

[99] Permitting or condoning non-compliance in such circumstances would offend the principle of legality. See: Moroka supra.

[100] I echo the same sentiments in this matter. Any prejudice to the first and second respondents which is alleged cannot and should not usurp the right and duty of the Department to ensure it adheres to a lawful procurement process, the rights of other tenderers and the overriding public interest in a lawful and transparent tender process. Courts must provide effective relief for infringements of Constitutional rights.

[101] I am therefore of the view that the only constitutional permissible relief open to this Court is to set aside the whole tender process in its entirety and to order the Department to begin the process de novo.

F. JUST AND EQUITABLE REMEDY

[102] Once it is accepted that the tender must be set aside and the tender redone, the question then arises what will happen to the delivery of stationery to the learners in the North West Province for 2015? It is in answer to this question that the Court may act under section 172 of the Constitution read with section 8 of PAJA and craft a “just and equitable remedy” to ensure the smooth delivery of stationery.

[103] In order to ensure the timeous delivery of stationery to learners prior to the commencement of 2015 school year, the Department considered entering into an agreement with the first respondent and the third respondent to extend a similar previous Tender EDU 34/13 NW to be executed jointly by the first and third respondent for a period of twelve months in compliance with the Department’s Constitutional obligation to render basic educational services to learners in the North West Province. The first respondent and the third respondent supported this proposition because they have already indicated its acceptance when the Department intimated to this kind of proposal in the letter they wrote to them.

[104] The Department’s proposal is rejected by the second respondent and the twentieth respondent. The second respondent proposition is to the effect that the order of invalidity should be suspended with a rider that as interim measures, it together with the first respondent should be directed to supply the existing stationery the two alleged to have been made ready and available by virtue of having concluded the contract with the Department. According to the third respondent, like the first respondent, it ordered the material in advance to be ready to timeously deliver in terms of this tender award which is the subject matter of this case. The material is ready. The amount of stock the second respondent has according to it will take years to divert to other customers.

[105] The twentieth respondents is totally against all of the above proposed interim measures and submitted firstly that, most importantly, the letters awarding the tenders to the first and second respondents stipulated: “The letter of acceptance constitutes a binding contract but no services should be rendered until a written official order is written ”, The same letters of appointment indicate that a service level agreement would be drawn up and entered into. The first applicant has confirmed that the tender awarded was an order-based tender where the supplier would only commence with the implementation of the service when order were issued and upon conclusion of a service level agreement. Accordingly, the first and second respondents have incurred expenses prematurely and at their own peril.

[106] Secondly that, the eleventh hour proposed arrangement between the first respondent and the third respondent, the Department has seemingly embarked upon a frolic of its own and sought to engage, or prepare to engage, with the first respondent and the third respondent in something of a temporary measure. According to the counsel for the twentieth respondent, such conduct is unlawful (procedurally and substantively) and no grounds exist for the Department to have unilaterally sought to make this arrangement.

[107] Lastly he submitted that the proposed arrangement does not constitute a suitable interim measure. The Department is in the position to reevaluate the tenders within 4 weeks of the grant the order in this matter which would permit delivery of stationery on time for the 2015 school cycle.

[108] The just and equitable remedy this Court made in the order that was issued already was an effort to strike a clear balance between the interests of the organ of the state, the successful and unsuccessful tenderers as well as the public at large, particularly the children.

[109] Secondly, this case is entirely different from AllPay 2. In AllPay 2, CPS had performed under the existing contract for years after SASSA had implemented the contract in partnership with CPS. In this case, the tender award has not yet been implemented since there is no work order or service level agreement concluded between the parties, and the Department has instead brought an urgent application to set aside its own award. There is therefore no existing contract that is up and running already as the old one has expired.

[110] In my view, the suspension of the declaration of invalidity to allow the parties a chance to give further submissions on remedy was not feasible because the case was extremely urgent as indicated before and furthermore, all the parties had an opportunity to deal with this issue during their arguments.

[111] Extending the old contract that has expired already as the Department proposed (the eleventh hour proposal arrangement between the Department and first and third respondents) and/or the granting of the order that first and second respondents are to deliver the material already on stock as alleged by them would in my view result in a process of picking and choosing the favoured over the others. Furthermore, Courts are not inclined to make contracts for the parties. The Court in the Loliwe judgment remarked as follows: “the power in terms of Section 8 of PAJA to make any order that would be just and equitable in the circumstances does not extend to making contracts for the parties”. Which remarks supports the stance this Court took in the just and equitable remedy it ordered.

G. COSTS

[112] Although costs normally follow the result, I am of the view that each party should pay its own costs. The Department succeeded substantially in this application, but one cannot brush away the fact that it is an author of its own misfortune. It was because of its own officials that the whole fight about this tender award was necessitated. Similarly, all the respondents in this matter, whether in support of the application or against it, decided to oppose or support the application clearly to advance its own respective position even where the circumstances of the case did not warrant that as seen from the various submissions advanced by each party including the various interlocutory applications that were dealt with in this matter.

[113] Taking into consideration all of the above circumstances, the order dated 18 September 2014 was granted.

A.M. KGOELE

JUDGE OF THE HIGH COURT

ATTORNEYS:

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FOR THE 20th RESPONDENT : JH Nicholson Stiller & Gehsen Attorn

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