Case Law[2024] ZAGPPHC 905South Africa
African Exploration Mining and Finance Corporation (SOC) Limited v LME Plant Hire (Pty) Ltd (060853/2023) [2024] ZAGPPHC 905 (9 September 2024)
High Court of South Africa (Gauteng Division, Pretoria)
9 September 2024
Headnotes
of the evaluation of the procurement committee and were satisfied with the outcome. AEM does not attack the outcome of the procurement assessment review process nor outcome thereof. The thrust or the heart of the of the review relief stated by AEM’s Counsel, lies in the non-fulfilment of the conditions requirement stated in the impugned decision.
Judgment
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## African Exploration Mining and Finance Corporation (SOC) Limited v LME Plant Hire (Pty) Ltd (060853/2023) [2024] ZAGPPHC 905 (9 September 2024)
African Exploration Mining and Finance Corporation (SOC) Limited v LME Plant Hire (Pty) Ltd (060853/2023) [2024] ZAGPPHC 905 (9 September 2024)
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sino date 9 September 2024
IN
THE HIGH COURT OF SOUTH AFRICA
(GAUTENG
DIVISION, PRETORIA)
Case
No:
060853/2023
(1)
REPORTABLE: NO
(2)
OF INTEREST TO OTHERS JUDGES: NO
(3)
REVISED
DATE:
9 SEPTEMBER 2024
SIGNATURE
In the matter between:
AFRICAN
EXPLORATION MINING AND FINANCE CORPORATION (SOC) LIMITED
Applicant
and
LME
PLANT HIRE (PTY) LTD
Respondent
This
judgment is prepared and authored by the Judge whose name is
reflected as such and is handed down electronically by circulation
to the parties / their legal representatives by email and by
uploading it to the electronic file of this matter on CaseLines.
The date for handing down is deemed to be 09 September 2024.
JUDGMENT
RETIEF J
INTRODUCTION
[1]
The applicant, African Exploration Mining and
Finance Corporation (SOC) Limited [AEM] is a State-owned company
which brings a self-review
application of a decision taken by its
Board on the 21 October 2021 to award bid number
AE/VLAK009/2021
to the
respondent, LME Plant Hire (Pty) Ltd
[LME] [impugned decision].
[2]
Pursuant to the impugned decision AEM and LME
concluded an agreement in 2022 [rental agreement]. AEM, as a result
of the impugned
decision seeks that the rental agreement, in terms of
section 172(1)(a) of the Constitution be declared constitutionally
invalid
ab initio
.
AEM too, requires this Court to consider just and equitable relief in
terms of section 172(1)(b) of the Constitution. The latter
a
self-standing prayer.
[3]
The review relief is sought approximately 4
(four) months after the agreed term of the rental agreement had
already expired, after
LME on the undisputed facts, complied
with with all its obligations in terms of the rental agreement and,
after LME, had
already initiated arbitration proceedings for,
inter
alia,
monetary relief in terms
of the rental agreement.
[4]
LME has brought a counterapplication
seeking that the rental agreement be declared valid and binding, that
its monetary claim,
which is the subject matter of the pending
arbitration proceeding be, in terms of
section 3(1)
of the
Arbitration Act 42 of 1965
[Arbitration Act] declaring the resolution
thereof t no longer subject to arbitration proceedings but rather
this application by
way of the relief in the counter application
[counterclaim].
[5]
Both parties agree that if this Court declares
the rental agreement invalid
ab
initio,
then the relief sought by
LME, by way of its counterclaim, cannot be granted and therefore need
not be entertained.
[6]
Before dealing with the merits of the main
application, the respondent, LME brings an unopposed condonation
application for the
late filing of its answering affidavit. AEM
brought its review relief in terms of unform
rule 6
and not in terms
of uniform
rule 53.
This created confusion between the parties when
the answering affidavit should have been filed. In particular if it
was only due
after the filing of a complete record. LME, out of
caution, brings this condonation application in so far as this Court
applies
rule 6
in which case its answering affidavit would be 3
(three) weeks late. If
rule 53
is considered LME contend condonation
not unnecessary. Under the circumstances and having regard to the
reasons set out, the fact
that LME in a review application would be
entitled to the complete record to enable it to file a meaningful
answering affidavit,
the delay is condoned. AEM did not oppose the
relief nor sought to supplement its founding papers after the filing
the record.
This is understandable in a self-review application. The
reasons for such delay were sufficiently set out and explained in the
papers.
[7]
Over and above the condonation, LME too, raises
that AEM, on the common cause facts, has delayed in bringing their
legality review
and has failed to deal with the time it took them to
bring the application in their founding papers. Conversely, AEM
contends that
it did not delay in bringing the self-review relief and
in any event, it contends even if the Court should find there was a
delay
and that such delay was unreasonable, such delay should be
condoned simply due to the nature of the relief AEM seeks.
[8]
The aspect of delay and the review relief,
warrants a look at the background facts giving rise to the purpose
and reason for this
application.
BACKGROUND
FACTS
[9]
AEM’s core business is the mining of
strategic assets such as coal for national government. Pursuant
thereto and on 28 April
2021 it issued a request for proposals for
the provision of services for mining equipment at its Vlakfontein
Mine, near Ogies [the
Mine] for a period of 12 months from the date
of the cost award.
[10]
AEM by means of its request for tender
proposals [RFP] sought to appoint suitable qualified service
providers for the rental of
mining machinery for a period of 12
months at the Mine. Bidders were required to tender a machine rate
per hour for each of the
types of equipment required by AEM, namely 2
(two) excavators, 19 (nineteen) ADT’s, 3 (three) track dozer
and 1 (one) water
bowser [collectively equipment]. The bidders had to
quote for the rental of the equipment as set out in a Bill of
Quantities.
[11]
The Bill of Quantities also made it clear that
the equipment had to be available for a specific number of hours per
month and the
target for use of each equipment.
[12]
Unbeknown to the bidders, AEM apparently had a
budget allocation of an amount of R 91 902 000.00 for the project.
The RFP reflected
what AEM needed in respect of quantity rather that
what it had a budget for. LME in compliance with the RFP calculated a
total
monthly price for the rental of the equipment. The total
amount, excluding value added tax [vat] over the contract term of 12
months
amounted to R 119 646 000.00 and inclusive of vat this sum
translates to R 137 592 900.00.
[13]
Against this background and on the 2 July 2021
at a special procurement committee meeting, this committee recorded
their support
for LME. It recorded, at item 8.2 of the agenda that it
wanted to award the business for the provision of rental of the
equipment
to LME reflecting an estimated value of R 137 592 900.00.
[14]
Bangile Masisa, the Chairperson of the
special procurement board, signed a resolution to that effect on the
9 July 2021 which
stated:
“
i.
The Bid Evaluation Committee (BEC) to review the internal audit
report and ensure that all
gaps and misalignments identified are
closed out; and
...
iii.
The final approval for award of business to be granted by the board
as the estimated recommended
value is above the procurement committee
PC threshold.
”
[15]
A Mr Mthombeni, the Mine manager was one of the
5 (five) members of the BEC who according to the resolution of the
special procurement
committee had to, inter alia, review the internal
audit report. It is common cause that Mr Mthombeni signed a
declaration of his
assurance that he did not have a conflict of
interest, the signed declaration was 7 June 2021.
[16]
According to the BEC report there were twenty-three bidders which
participated
in the RFT process, three of which, including LME passed
through the functionary gate as being bidders who were able to
perform
the requirements of the tender. All the three entities scored
a maximum 10 points for B-BBEE (Broad-Based Black Economic
Empowerment
Score) and thus, the determining factor turned on price.
According to the bid prices of the three bidders, LME’s quoted
contract
price was lower than the other two.
[17]
On the 12 October 2021 Mr Mthombeni was placed
on precautionary suspension pending the outcome of an investigation.
He was charged
for failing to ensure that AEM’s machines, the
subject matter of a previous contract subsequent upon an unrelated
RFP, were
maintained according to standard and, with failure to
ensure that LME complied with mine safety standards. He was found
guilty
and dismissed on the 31 January 2022.
[18]
AEM relies on Mr Mthombeni’s suspension
on 18 October 2021 and subsequent dismissal on the 31 January 2022,
reasoning that
the procurement process, at the BEC level was tainted.
However, the thrust and reliance thereof was substantially diluted in
argument
when Counsel for the AEM stated that Mr Mthombeni and the
facts surrounding him did not lie at the heart of the reason for the
review relief.
[19]
Returning to the facts, on the 5 August 2021
the EXCO resolved that a procurement oversight review should be
conducted in respect
of the tender assessment process. The Board
assessed the report on the summary of the evaluation of the
procurement committee and
were satisfied with the outcome. AEM does
not attack the outcome of the procurement assessment review process
nor outcome thereof.
The thrust or the heart of the of the review
relief stated by AEM’s Counsel, lies in the non-fulfilment of
the conditions
requirement stated in the impugned decision.
[20]
On 21 October 2021, the Board
inter
alia
resolved to appoint LME, the
resolution of the Board stated:
“
Resolution: It
was resolved;
1.
That the appointment of LME Plant Hire (Pty) Ltd for the
purposes of services for rental of mining equipment at Vlakfontein
for
a period of 12 (twelve) months from
the contract award
be and is hereby approved
(own emphasis).
2.
That management be and is hereby empowered to renegotiate the
price down because the offer
bid price is above AEMF’s
budgeted price
(own emphasis)
and to
accordingly conclude the contract with the service provider should
the price negotiations be favourable to AEMFC.
3.
That management should award contracts after outstanding tax matters
have been cleared and the
service provider is tax compliant.
”
[21]
On 19 November 2021, the acting CEO of AEM, Mr
Bongani Khumalo advised LME that its proposal was successful. He did
so by stating,
inter alia
:
“
After
extensive evaluation of all bids received and adjudication by an
independent committee, African Exploration Mining and Corporation
(AEMFC) SOC Ltd takes pleasure in advising you that your company’s
proposal has been successful and approved as per the confirmed
value
of R 133 684 170.00 Vat inclusive subject to agreeing to our contract
terms”
[22]
On the 22 November 2021 LME accepted the
appointment letter. The contract price in the appointment letter upon
which consensus was
reached by written acceptance, was a vat
inclusive contract price of
R
133 684 170.00 not the vat inclusive amount of R 137 592 900.00.
[23]
On 19 January 2022, the acting CEO of AEM, Mr
Bongani Khumalo notwithstanding, signed the rental agreement on
behalf of AEM for
a vat inclusive amount of R 137 592 900.00.
GROUNDS
OF REVIEW
[24]
AEM’s founding papers are poorly drafted,
they failed to incorporate any evidence from the record relied upon.
However, the
following reasons for seeking the review relief are:
20.1
Only the Board could decide to award the Bid. AE/Vlak009/2021 to LME.
No Board
decision authorised the conclusion of the rental agreement.
20.2
The rental agreement was concluded contrary to the impugned decision
as the
contract price was conditional.
20.3
The procurement process was tainted in that the Board failed to take
into account
the unlawful dictates of Mr Mthombeni in the process.
[25]
Before considering the weight of the reasons
for the review relief, the Court considers the aspect of delay as
raised by LME.
DELAY
[26]
LME correctly contends that a self-review under
the doctrine of legality, is to be brought without unreasonable
delay. Notwithstanding
the fact that the impugned decision had
already been taken in October 2021 and that the rental agreement had
already terminated
before AEM launched their self-review, AEM failed
to deal with the aspect of time in anyway in its founding papers. In
fact, it
was so bullish that when challenged in answer by LME it did
not deem it necessary, out of an abundance of caution, to request
this
Court to overlook a possible delay, if any, raised by LME on the
papers.
[27]
AEM maintains that it launched the review
relief within a reasonable time after it became aware, whilst
preparing for the arbitration
on 1 June 2023, that irregularities had
occurred. This is somewhat 4(four) months after arbitration
proceedings had been initiated
and before AEM had pleaded to LME’s
statement of claim. This application was launched on the 23
June 2023.
[28]
LME contends that the impugned decision was
taken on 21 October 2021 and that it is from this date that the delay
should be assessed,
alternatively, in January 2022 when the rental
agreement, pursuant to the impugned decision was concluded between
the parties.
[29]
Therefore, LME contends that the time period is
1 (one) year and 8 (eight) months from the impugned decision,
alternatively 1 (one)
year and 5 (five) months having regard to the
conclusion of the rental agreement.
[30]
It is trite that the legality review must be
brought without undue delay therefore triggering an enquiry into
whether there was
a delay and if such delay was reasonable. The clock
in a legality review does not start ticking because of the provision
of a uniform
rule, but rather the date on which AEM, in this case,
became aware or reasonably ought to have become aware of the impugned
decision
alternatively date of the conclusion of the rental agreement
it now seeks to challenge. No facts are set out by AEM in an attempt
to explain what happened at the time the impugned decision was taken
which could have prevented it from ascertaining such irregularities
it now relies on. Nor for that matter, why it could not ascertain
sooner and have launched this review without delay. A full and
proper
explanation is key/paramount in assessing whether AEM’s
behaviour is reasonable.
[31]
AEM contends there was no delay. No
particularity regarding the checks and balances which took place by
AEM prior to the expiration
of the impugned agreement (i.e., prior to
the appointment of the new CEO with effect from 1 February 2022). If
such CEO was not
in a position to shed light on what transpired at
the material time, then who? No explanation advanced and as such, AEM
appears
to have been oblivious of any irregularities, this is even
during the period between Mr Mthombeni’s suspension and his
discharge.
Had it not been for the arbitration proceedings launched
by LME for payment in terms of the rental agreement, AEM it appears
would
have been none the wiser of an alleged irregularity and the
need to launch a legality challenge. AEM taking action only when it
was pressurised to fulfil its obligations in terms of the rental
agreement.
[32]
Against this backdrop there is no explanation
why the previous CEO as discussed above did not file any papers in
support of the
challenge raised in LME nor for that matter, any other
official who still remains in AEM’s employ. Such explanation is
critical
to establish any reasonable behaviour. Lack thereof speaks
to a lack of effective oversight. AEM’s lack of effective
oversight
is compounded by the fact that AEM only became aware of a
possible need to bring the review relief in June 2023. This is more
than
a year after the conclusion of the rental agreement and after it
had already terminated. Applying reasonable effective oversight,
it
is not unreasonable to expect AEM to have reasonably become aware of
the need to launch these proceedings much sooner and, to
explain the
facts in a proper detailed manner. None was forthcoming.
[33]
This
lack of explanation and oversight warrants a reminder of what Theron
J, aptly stated in the
Buffalo
City
[1]
matter when she referred to an overview report by the Department of
Co-Operative Governance and Traditional Affairs on the state
of local
government in South Africa, she quoted: “
Municipalities
must have effective structures and mechanisms in place to ensure
proper oversight for its serious delivery projects.
This is one of
the responsibilities ... A lack of effective oversight leads to
dysfunctionality within municipalities by creating
loopholes for
fraud and corruption.”
AEM is to be painted with the same brush. This is said too, having
regard to its own papers and reliance on the allegations pertaining
to any tainted procurement process involving Mr Mthombeni, in
particular. Surely the moment that Mr Mthombeni was suspended in
October 2021, a date prior to the conclusion of the rental agreement
and soon after the impugned decision was made by the Board
AEM should
have explained in full. AEM has not take the Court into its
confidence and its conduct inexcusable.
[34]
The reasonableness of a delay is entirely dependent on the facts and
circumstances of any case. The investigation into reasonableness of a
delay has nothing to do with the court’s discretion.
It is an
investigation into the facts of the matter in order to determine
whether, in all the circumstances of that case, the delay
was
reasonable. It is therefore a value judgment and not a judicial
discretion.
[35]
Without sufficient facts, the delay is
unreasonable.
Should
the undue delay be overlooked
?
[36]
This
Court is acutely aware that the approach to overlook an unreasonable
delay in a legality review is flexible and is a legal
evaluation.
Bearing in mind that the delay bar serves an important rule of law
function: it promotes the public interest in certainty
and finality
in decision-making.
[2]
This is
culminated with the fact that AEM does not, at its own behest,
request this Court to overlook any delay and in consequence
an
evaluation and need to overlook is not triggered by AEM. There is no
basis.
[37]
In
Khumalo
and Another v The Member of the Executive Council of Education:
KwaZulu-Natal
,
[3]
Skweyiya J, whilst acknowledging the undisputed existence of the
delay rule, observed but courts nevertheless have the discretion
to
overlook a delay where appropriate. He said:
“
[A] court
should be slow to allow procedural obstacles to prevent it from
looking into a challenge to the lawfulness of an exercise
of public
power. But that does not mean that the Constitution has dispensed
with the basic procedural requirement that review proceedings
are to
be brought without delay or with a court’s discretion to
overlook a delay
.”
[38]
The support of the statement is section 237 of the Constitution which
holds:
“
...
Section 237 acknowledges the significance of timeous compliance with
constitutional prescripts. It elevates expeditious and
diligent
compliance with constitutional duties to an obligation in itself. The
principle is thus a requirement of legality
.”
[39]
However,
applying the
Gijima
[4]
principle this Court considers whether notwithstanding an
unreasonable delay and notwithstanding AEM’s failure to request
this Court to overlook the unreasonable delay whether it should do
so. Such consideration not as a result of the nature of the
relief as
AEM contends but in circumstances where the unlawfulness of the
impugned decision and/or conclusion of an agreement,
on the facts is
clear and undisputed.
[5]
[40]
This is not the case at first blush. In fact,
as will become apparent AEM’s Counsel in argument was correct
to inform this
Court that the not much lay in the challenge of a
tainted procurement process. Not to overlook the unreasonable delay
tempting
for that reason alone. However, it is clear from the facts
that the rental agreement was concluded for an amount higher that the
awarded and agreed contract price. Although the purpose of the tender
achieved, the public purse would be harmed if this Court
did not
overlook the unreasonableness of the delay and deal with the merits.
[41]
Furthermore, any prejudice that LME may suffer
as a result of this Court overlooking the delay can, in terms of
section 172(1)(b)
of the Constitution, be ameliorated by awarding
just and equitable relief. As such, this Court overlooks the
unreasonable delay
and deals with the merits of the review.
MERITS
[42]
As mentioned, the weight of the impugned decision being tainted by
the suspension
and ultimate dismissal of Mr Mthombeni the mine
manager and member of the BEC was substantially watered down in
argument. This
too, was echoed on the papers when LME’s
substantial answer to the allegations in the founding allegations
relating to Mr
Mthombeni were not met head on. Attempts were made to
taint Mr Mthombeni character but were insufficient to establish a
nexus between
his actions and a tainted process giving rise to the
impugned decision. In fact, AEM did not even answer how his
participation
and presence in the BEC staged process could have
“-
gravely tainted the integrity of the process”
as
alleged. Nor whether any confliction he may have had, perceived or
otherwise, had any affect at all.
[43]
AEM in reply states that if the Board were properly appraised of Mr
Mthombeni impropriety
in the tender evaluation process, the Board
would have commenced the tender process
de novo
. Besides that,
this statement is unsubstantiated, AEM did not even bother to deal
with the tender process followed by it, nor how
he as a member of the
BEC wielded any undue influence and weight in the BEC’s
decision, let alone, how Mr Mthombeni factual
participation caused a
tainted outcome. AEM’s failure to deal with LME’s
substantial answer after they did consider
the record in its
entirety, supports the notion that the allegation was made in a
vacuum although, amidst admitted concerns about
Mr Mthombeni.
[44]
What too, was left wanting in reply, was AEM’s allegation in
their founding
papers that Mr Mthombeni, after his dismissal, was
employed by LME. A prejudicial accusation indeed in the
circumstances. Other
than making the allegation, its veracity when
denied in answer was abandoned in reply. This is probably why this
ground was not
expanded in argument. In consequence, this ground is
unconvincing as raised on the papers and appears to be a hollow
complaint
about procedural mischief which was not established on the
material facts nor sufficiently argued.
[45]
The nub of the grounds centred around the legality and rationality of
the conclusion
of the rental agreement. The complaints are that it
was concluded in circumstances without Board authority and without
the condition
of resolution 2 of the impugned decision being met,
namely: “
2.
That management be and is hereby
empowered to renegotiate the price down
(own
emphasis) because the offer bid price is above AEMF’s budgeted
price
and
to accordingly conclude the contract
with the service provider should the price negotiations be favourable
to AEMFC
[46]
Turning to the condition, resolution 2 of the impugned
decision, empowers management
to renegotiate a lower price. Lower
than the offer bid price which, on the common cause facts was
a
vat inclusive amount of R 137 592 900.00.
The Board does not
disclose the budgeted price in the impugned decision. All that is
known is that it must be a “
price down’
from the
‘
offer bid’
and ‘
favourable to AEMFC’
.
[47]
AEM did not establish on the facts what the Board meant by
‘favourable’
nor what amount would constitute
‘favourable.’ What is clear is that management
could determine what ‘favourable’
was in the
circumstances and that it should be lower than the bid price.
[48]
AEM did not establish what management decided ‘favourable’
was however,
on the common cause facts,
on the
19 November 2021, the acting CEO of AEM, Mr Bongani Khumalo advised
LME that:
“
After
extensive evaluation of all bids received and adjudication by an
independent committee, African Exploration Mining and Corporation
(AEMFC) SOC Ltd takes pleasure in advising you that your company’s
proposal has been successful and approved as per the confirmed
value
of R 133 684 170.00 Vat inclusive subject to agreeing to our contract
terms”
[49]
AEM does not wish to review the 19 November 2021 decision. This
decision is not disturbed.
The amount is factually lower that the bid
price. The evidence is that consensus was reached between LME and AEM
in writing at
a price lower that the offer bid price.
[50]
In consequence the condition in resolution 2 met on the pleaded
facts. However as
in borne out by the facts, the rental agreement was
concluded for the bid price and signed by the then acting CEO. This
complaint
must fail.
[51]
According to AEM’s Policy on Limits of Authority document
reference:AE-02 version
7, approved by its Board on the 23 May 2018,
the rental agreement being for an amount exceeding R 50 million rand,
the CEO is authorised
‘to sign a contract upon Board approval’.
Upon Board approval suggests an action to be done first: ‘upon
the proper showing of ….’ or ‘sign on approval by
the Board’ or ‘to sign when the Board approves’.
All interpretations suggest that the rental agreement can be signed
by the CEO upon approval obtained by the Board. Any decision
to the
contrary in conflict with the Policy.
[52]
AEM complains that no such approval was obtained from the Board
which appears
to be correct on the facts. This is because, as at the
time the impugned decision was taken by the Board, no contract was
available
to approve yet and still had to be renegotiated.
[53]
The agreed
and approved contract price
[6]
not in conflict with the rental agreement and no Board approval was
obtained before signature by the CEO or acting CEO. Both suggest
interference by this Court on review and as such this ground
warranted.
JUST
AN EQUITABLE RELIEF
[54]
Having regard to the facts and outcome in this matter and that AEM
too seeks this
Court to consider what is just under the
circumstances, this Court in terms of section 172(1)(b) of the
Constitution is entitled
to strike a balance, cloaking the Court with
remedial powers so extensive that they ought to be able to craft an
appropriate or
just remedy having regard to all the facts. In so
doing to find a solution to the problem.
[55]
In finding the solution this Court considers the substantial
prejudice that will
be suffered by LME who has performed in terms of
the rental agreement and who has instituted arbitration proceedings
based on the
rental agreement, if the rental agreement was to be set
aside. This Court too, is aware that its necessity to deal with LME’s
counterclaim may fall away and redress for LME is paramount under the
circumstances.
[56]
AEM on the other hand, has had the use of the mining equipment
according to
the quantities it required and for the duration. Such
mining equipment assisting it with the mining of coal resources on
the mine.
Its business was able to continue and remained
unhindered. It does not want to pay LME, after the fact. Although
this can’t
be indulged, AEM should not be forced to pay LME
more than what was approved and agreed to. Public purse
considerations are an
important factor.
[57]
This Court therefore will make an order that the rental agreement is
declared invalid,
but will not set the rental agreement aside as to
preserve the rights LME is entitled to in terms of the rental
agreement. However,
with the caveat that LME is only entitled to
claim from AEM amounts due and owing in line with the agreed contract
price of
R 133,684,170.00 vat inclusive. It
should be noted that such an award is balanced and it preserve rights
which have accrued up and
until the contract term expired.
COUNTERCLAIM
[58]
The question which then arise is whether a necessity arises for this
Court to deal
with LME’s counter application in circumstances
when both AEM and LME agreed that if the rental agreement was to be
set aside
there would be no need for this Court to entertain LME’s
counter claim. This Court is of the opinion that the position remains
unchanged and it does not need to entertain the counter claim. LME
declaratory relief prayer 2 cannot be granted triggering the
clear
necessity. Furthermore, although LME’s rights, in terms of the
rental agreement to claim payment are preserved, the
rental agreement
has been declared invalid, the basis upon which LME’s
counterclaim is based and the facts on the papers
disturbed by the
just and equitable relief.
[59]
Both parties will not be prejudiced by this outcome in that, LME has
already initiated
and triggered the arbitration agreement, AEM has
not filed its plea and the papers already filed are capable of
amendment to echo
the basis and order of this Court.
[60]
As to the costs. It is trite that costs follow the result. In this
matter all the
circumstances were weighed and considered. In
particular AEM’s delay, the lack of affording this Court any
explanation whatsoever
to ameliorate a delay or perceived delay, the
timing of the launching of this application. AEM appeared to have
benefitted from
LME’s compliance of its obligations in terms of
the rental agreement without payment from April 2022 to February
2023. Such
claimed amounts by LME not even disputed on these papers
as raised in the counterclaim. AEM has delayed the inevitable at
LME’s
expense. This can be corrected and as such costs are
awarded to LME.
[61]
The following order:
1.
The Respondent is granted condonation for the late filing of its
answering affidavit
2.
The agreement between the Applicant and the Respondent pursuant to
the award Bid No. A3/VLAK009/2021
is declared invalid but is not set
-aside.
3.
The Respondent’s rights in terms of the agreement referred to
in prayer 1 are hereby preserved
and the Applicant’s
obligations in terms thereof is hereby limited to a contract price of
R 133,684,170.00 (
(inclusive of value
added tax)
.
4.
The Applicant to pay the Respondents costs on a
party and party scale included the costs of Counsel taxed on scale B.
L.A.
RETIEF
JUDGE
OF THE HIGH COURT
GAUTENG
DIVISION, PRETORIA
Appearances
:
For
the Applicant:
Adv S
M Tisani
Cell:
072 213 2300
Email:
sazitisani@advocatesa.co.za
Instructed
by attorneys:
Diale
Mogashoa Attorneys
Tel:
012 346 5436
Email:
donald@dialemogashoa.co.za
For
the Respondent
Adv
A. Friedman
Cell:
083 308 5354
Email:
friedman@group621.co.za
Instructed
by attorneys:
Schindlers
SI Attorneys
Tel:
011 448 9600 / 071 896 2916
Email:
Bowes@schindlers.co.za
Osther@schindlers.co.za
Date
of hearing:
02
August 2024
Date
of judgment
:
09
September
2024
[1]
Buffalo
City Metropolitan Municipality v ASIA Construction (Pty) Ltd
[2019] ZACC 15
; Overview Report (October 2009).
[2]
Khumalo
v Member of the Executive Council for Education, KwaZulu-Natal
[2013] ZACC 49
;
2014 (5) SA 579
(CC);
2014 (3) BCLR 333
(CC) at par
47.
[3]
[2013]
ZACC 49
;
2014 (3) BCLR 333
(CC); (2014) 35 ILJ 613 (CC); 2014 (5) SA
579 (CC).
[4]
State
information Technology Agency (SOC) Limited v Gijima Holdings (Pty)
Ltd
2017 ZACC 40
;
2018 (2) SA 23
(CC);
2018 (2) BCLR 240
(CC) at 52.
[5]
Ibid
at para 41.
[6]
See
para [21].
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