Case Law[2022] ZAWCHC 47South Africa
Rodpaul Construction (Pty) Ltd t/a Rod's Construction v Breede Valley Municipality and Others (6435/2022) [2022] ZAWCHC 47 (24 March 2022)
Headnotes
to be
Judgment
begin wrapper
begin container
begin header
begin slogan-floater
end slogan-floater
- About SAFLII
About SAFLII
- Databases
Databases
- Search
Search
- Terms of Use
Terms of Use
- RSS Feeds
RSS Feeds
end header
begin main
begin center
# South Africa: Western Cape High Court, Cape Town
South Africa: Western Cape High Court, Cape Town
You are here:
SAFLII
>>
Databases
>>
South Africa: Western Cape High Court, Cape Town
>>
2022
>>
[2022] ZAWCHC 47
|
Noteup
|
LawCite
sino index
## Rodpaul Construction (Pty) Ltd t/a Rod's Construction v Breede Valley Municipality and Others (6435/2022) [2022] ZAWCHC 47 (24 March 2022)
Rodpaul Construction (Pty) Ltd t/a Rod's Construction v Breede Valley Municipality and Others (6435/2022) [2022] ZAWCHC 47 (24 March 2022)
Download original files
PDF format
RTF format
make_database: source=/home/saflii//raw/ZAWCHC/Data/2022_47.html
sino date 24 March 2022
IN
THE HIGH COURT OF SOUTH AFRICA
(WESTERN
CAPE DIVISION, CAPE TOWN)
Case
No: 6435/2022
In
the matter between:
RODPAUL
CONSTRUCTION (PTY) LTD
t/a
ROD’S CONSTRUCTION
Applicant
and
BREEDE
VALLEY MUNICIPALITY
First Respondent
THE
MUNICIPAL MANAGER: BREEDE VALLEY
MUNICIPALITY
Second Respondent
CIVILS
2000 (PTY) LTD
Third Respondent
JUDGMENT
DELIVERED ELECTRONICALLY ON 24 MARCH 2022
MANGCU-LOCKWOOD,
J
I.
INTRODUCTION
[1]
The applicant seeks an
interim interdict preventing the first respondent from implementing
the award of a tender to the third respondent,
pending the final
determination of a review of the tender which is sought as part B of
the applicant’s application. The application
is opposed by the
first and second respondents, (hereafter referred to as “
the
first respondent”
),
and while the third respondent delivered a notice of intention to
oppose, no answering papers were delivered on its behalf, and
I was
informed from the Bar that it is no longer pursuing the opposition.
II.
THE
FACTS
[2]
The facts are common cause. On 1 October 2021 the
applicant submitted a bid for a tender advertised by the first
respondent as
the
“
Extension of wastewater
treatment works: Rawsonville (Civil and Structural works)”
.
[3]
On 1 February 2022 the first
respondent addressed a letter to the applicant notifying it that its
tender was non-responsive to participate
further on price and
preferential points, for failure to comply with the eligibility
criteria of the tender (“
the
outcome letter”
).
The letter stated as follows:
“
The
eligibility criterion (b) required bidders to achieve the minimum
local content for the listed designated products/items. [The
applicant] did not complete Annexure C4 and annexure E of the local
content declaration (Schedule 1P) to show the percentage local
content for the designated products/items offered and therefore
failed to show compliance with this requirement.”
The
outcome letter further drew attention to the applicant’s right
to lodge an objection within 14 days; alternatively, to
lodge an
appeal within 21 days in terms of section 62 of the Local Government:
Municipal Systems Act 32 of 2000 (“
the
Systems Act”
),
and also advised the applicant of the format that an objection or
appeal should take.
[4]
On 21 February 2022 the applicant, through its
attorneys, lodged an appeal against the decision contained in the
outcome letter.
In summary, the applicant stated that the tender
document is ambiguous because Annexure C4 failed to list the item
number or the
items a calculation of local content is required for.
By contrast, Annexures C1 to C3 in the tender documents do make
provision
for the items to be calculated with cross reference to the
items listed on the bill of quantities. On the basis of the alleged
ambiguity the applicant states that the first respondent should have
rather sought clarity from it, as it was entitled to do, instead
of
declaring its bid non-responsive.
[5]
On 25 February 2022 the first respondent notified
the applicant that the internal appeal mechanism in terms of section
62 of the
Systems Act was not applicable and/or available to it. The
reason provided was the following: “
[D]ue
to the pecuniary value of the tender offer, the final decision to
approve the recommended award vested in the Accounting Officer
and
not in the Bid Adjudication Committee (“BAC”). The
Municipal Manager, in his capacity as Accounting Officer, executed
his powers of approval in terms of regulation 5(2)(a) of the
Municipal Supply Chain Management Regulations, 2017….
Accordingly,
your client’s tender remains non-responsive as per
the reasons stated in the outcome letter dated 1 February 2022 and
the
matter is hereby regarded as finalized.”
[6]
On that same day, 25 February 2022, the
applicant's attorneys notified the first respondent of their
instructions to launch review
proceedings on the basis of the alleged
ambiguity in the tender, and sought an undertaking that the first
respondent would not
implement the award of the tender pending the
review proceedings. By letter dated 28 February 2022, the first
respondent refused
to give such an undertaking.
III.
THE
BASIS FOR THE INTERIM RELIEF
[7]
In the founding affidavit the applicant relies on
section 217 of the Constitution of the Republic of South Africa (“
the
Constitution”
), section 6(2) of
the Promotion of Administrative Act 3 of 2000 (“
PAJA”
),
and Regulation 8 of the Preferential Procurement Regulations, 2017
(“
the 2017 Regulations”
)
which are made in terms of section 5 of the Preferential Procurement
Policy Framework Act 5 of 2000 (“
PPPFA”
)
for the review of the first respondent’s decision, which is
said to contain a material irregularity, namely the alleged
tender
document ambiguity, stating that the ambiguity renders the entire
bidding process unfair. This, in essence, is said to be
the
applicant’s
prima facie
right. Furthermore, it is stated in the founding affidavit that,
having regard to the bill of quantities and the information supplied
by the applicant as a whole, the purpose of annexure “C4”
- namely to determine whether the first respondent required
the
supply of electrical cables - was in any event substantially
achieved.
[8]
Before the respondent delivered answering papers
the applicant delivered a supplementary founding affidavit dealing
with a recently
delivered judgment of the Constitutional Court in
Minister of Finance v Afribusiness NPC
[2022] ZACC 4
(“Afribusiness”)
in
which the introduction of pre-qualification criteria to the tender
process introduced by the 2017 Regulations was held to be
unconstitutional. In short, the applicant seeks to rely on the
Constitutional Court’s reasoning in
Afribusiness
as a further ground for review of the first respondent's decision in
this case, and seeks to have regulation 8 of the 2017 Regulations
declared unconstitutional and invalid insofar as it requires local
authorities to set local production and content as a threshold
requirement for bidding, and also states that the requirement of
electrical cables is superfluous. As a result, the applicant has
also
delivered an application to join the Minister of Finance in the
review proceedings.
[9]
In the replying affidavit the applicant raises the
first respondent's failure to grant it an internal appeal in terms of
section
62 of the Systems Act as an additional ground for the interim
interdict.
[10]
The first respondent denies that the tender
is ambiguous. It firstly refers to the express terms of the Bid
Notice and Invitation
to Tender (“
the
Invitation to Tender”
), which
states that “
only tenderers who
satisfy the eligibility criteria stated in the Standard Conditions…
will be eligible to submit tenders.
Tenderers who achieve the minimum
threshold for local production and content as prescribed by National
Treasury of 100% for Structural
Steel Products, 100% for uPVC Pipes,
90% for cables, and 70% for valve actuator products will be eligible
to submit tenders….[F2.1.1]
The
first respondent states that it was clear from this clause that
compliance with the eligibility criteria is mandatory, and that
the
bidder is required to meet the minimum threshold of local production
and content for all the four mentioned categories, namely
structural
steel products, uPVC pipes, electrical cables, and valve actuator
products.
[11]
The
first respondent also points to paragraph F.2.7 of the Invitation to
Tender which provides as follows: “
Due
to the national state of disaster a briefing session/clarification
meeting will not be held. Bidders are requested to send electronic
emails for any inquiries related to the bid to
zaheer@bergstan.co.za
...”
.
Paragraph F.2.8 makes a similar invitation regarding requests for
clarification of the tender documents.
On
the basis of these provisions the first respondent states that if
bidders had any queries or clarification questions they were
invited
to submit them
via
the email address provided, and the applicant failed to avail itself
of the opportunity to seek clarity if there was any such alleged
ambiguity.
[12]
In addition, the first respondent has attached to
its answering affidavit the forms referred to as annexures “C1”
to
“C4” in the applicant's founding papers. They were
introduced in the tender document by means of a document entitled
“
Schedule 3G: Declaration
Certificate for Local Production and Content” (“Schedule
3G”)
and, together with the
Schedule 3G, are all marked as “
returnable
documents”.
It is stated in
Schedule 3G that regulation 8 of the 2017 Regulations makes provision
for the promotion of local production and
content. It is stated in
paragraph 1.7 thereof that “
[a]
bid will be disqualified if the bidder fails to achieve the
stipulated minimum threshold for local production and content
indicated
in paragraph 3 below, and this declaration certificate is
not submitted as part of the bid documentation”
.
Paragraph 3 states as follows: “
The
stipulated minimum threshold(s) for local production and content for
this bid is/are as follows:
Description
of services works or goods
Stipulated minimum threshold
u
PVC Pipes
-
100%
Steel
Products
-
100%
Valve
and Actuators
-
70%
Cables
-
90%
”
[13]
Attached to Schedule 3G are annexures for each of
the four categories mentioned above. Annexure C1 relates to u PVC
Pipes; annexure
C2 relates to Steel Products; annexure C3 relates to
Valve and Actuators; and annexure C4 relates to Electrical Cables
Products.
In turn, each of those annexures is accompanied by an
Annexure E, which is headed “
Local
Content Declaration: Supporting Schedule to Annex C”
,
and is also marked as a “
returnable
document”
. It is common cause
that, in addition to failing to submit annexure C4, the applicant
also failed to submit any annexure E with
the annexures C1 to C3 that
it did submit.
[14]
In addition to the above, the first respondent
points to further non-compliance with the tender specifications by
the applicant.
It states that if the applicant had progressed to
scoring based on functionality, it would similarly have been
disqualified for
failure to comply with the experience requirement,
namely the successful completion of wastewater treatment works with a
water-retaining
structure volume greater than 500 m
3
in the past five years.
[15]
As regards the applicant’s reliance on the Constitutional Court
case of
Afribusiness
for the setting aside
of the Regulations,
the first respondent
has delivered a supplementary
answering
affidavit stating, in essence, that this is an issue which relates to
Part B of the applicant’s application. Furthermore,
according
to the first respondent, it is unclear from the court order in
Afribusiness
whether
the declaration of invalidity has taken place or not, and should in
any event be assumed to be prospective and not retrospective.
Moreover, the first respondent states that the effect of the relief
sought in this regard means that if successful, the interim
interdict
would be extended until final determination of the applicant’s
constitutional challenge which could take years,
at the expense of
the provision of services to the residents of Rawsonville, who are
the beneficiaries of the tender that is the
subject of these
proceedings.
[16]
Regarding the
challenge brought in relation to the
first respondent's failure to afford the applicant an internal appeal
the first respondent
states that this is a belated case made out in
reply and in the applicant’s heads of argument.
THE
LAW
[17]
The
requirements for granting an interim interdict were set out
in
Setlogelo
v Setlogelo
[1]
and
refined in
Webster
v Mitchell
[2]
.
An applicant who seeks interim relief must establish (a)
prima
facie
right
even if it is open to some doubt; (b) a reasonable apprehension of
irreparable and imminent harm to the right if an interdict
is not
granted; (c) the balance of convenience must favour the grant of the
interdict and (d) the applicant must have no other
remedy.
[18]
A
court may only grant a temporary restraining order against the
exercise of statutory power only in exceptional cases and when
a
strong case for that relief has been made out.
[3]
It
must be satisfied that the applicant for an interdict has good
prospects of success in the main review, based on strong grounds
which are likely to succeed.
[4]
[19]
However,
the
prima
facie
right that must be established is more than simply an applicant’s
right to approach the court for a review. The Constitutional
Court
has stated
[5]
that “
[u]
nder
the Setlogelo test,
the prima facie right a claimant must establish is not merely the
right to approach a court in order
to review an administrative
decision. It is a right to which, if not protected by an
interdict, irreparable harm would ensue.
An interdict is meant to
prevent future conduct and not decisions already made. Quite apart
from the right to review and to set
aside impugned decisions, the
applicants should have demonstrated a prima facie right that is
threatened by an impending or imminent
irreparable harm. The right to
review the impugned decisions did not require any
preservation pendente lite.
[20]
Furthermore,
when a court weighs up where the balance of convenience rests, it may
not fail to consider the probable impact of the
restraining order on
the constitutional and statutory powers and duties of the state
functionary or organ of state against which
the interim order is
sought.
[6]
As the
constitutional
court stated further in OUTA:
“
The
balance of convenience enquiry must now carefully probe whether and
to which extent the restraining order will probably intrude
into the
exclusive terrain of another branch of Government. The enquiry must,
alongside other relevant harm, have proper regard
to what may be
called separation of powers harm. A court must keep in mind that a
temporary restraint against the exercise of statutory
power well
ahead of the final adjudication of a claimant’s case may be
granted only in the clearest of cases and after a
careful
consideration of separation of powers harm. It is neither prudent nor
necessary to define “clearest of cases”.
However one
important consideration would be whether the harm apprehended by the
claimant amounts to a breach of one or more fundamental
rights
warranted by the Bill of Rights…”
IV.
DISCUSSION
[21]
The ambiguity alleged by the applicant requires a
contextual examination of the relevant tender documents, the detail
of which is
already set out above. It is clear from the requirements
set out there that one of the legislative requirements for the tender
was compliance with local content and production. Furthermore, the
requirement of local content and production had four categories,
namely structural steel products, uPVC Pipes, valve actuator
products, and electrical cable products, each of which had an
annexure
- C1 to C4 - dealing with its requirements. It is
furthermore clear from the documents that annexure C4, like C1 to C3,
was a returnable
document which required completion by the applicant.
The fact that annexure C4 did not contain any specified items, did
not change
the requirement to comply in respect of all four
categories. I am accordingly not persuaded that there is any
ambiguity in the
tender documents.
[22]
I am furthermore of the view that, if there were
such ambiguity, or if there was any doubt regarding the completion of
annexure
C4, the applicant should have availed itself of the
invitation contained in the tender documents to seek clarification.
The applicant
was well aware of the consequences of the failure to
properly complete the documents. The invitation to tender
specifically stated
as follows at paragraph F2.3:“
The
Tenderer shall satisfy himself that the set of tender documents is
complete and in accordance with the index. If any page has
been
omitted or duplicated, or if the script or dimensions, or anything
else in the tender document is indistinct, or if doubt
exists as to
the meaning of any description, or if the tender document contains
any obvious errors, the tenderer shall immediately
notify the
employer's agent accordingly, in writing, so that such discrepancy or
indistinctness can be clarified or rectified,
as the Breede Valley
Municipality or the Agent will not accept any responsibility or
consider any claim in connection with such
discrepancy or
indistinctness, which are not rectified during the tender.”
When viewed together with the paragraphs referred to by the first
respondent and already mentioned earlier, it is clear that the
tender
documents place considerable responsibility of seeking clarity
regarding the tender documents upon the tenderer; caution
the
tenderer against the failure to seek such clarity; and attach serious
consequences upon the tenderer for failing to do so.
[23]
The applicant relies on paragraph F.2.17 of the
Invitation to Tender for the argument that the first respondent
should have requested
clarity from it once it saw that the applicant
had failed to submit annexure C4. Paragraph F.2.17 provides as
follows:
“
Clarification
of tender after submission
Provide clarification
of a tender offer in response to a request to do so from the employer
during the evaluation of tender offers.
This may include providing a
breakdown of rates or prices and correction of arithmetical errors by
the adjustment of certain rates
or item prices (or both). No change
in the competitive position of tenderers or substance of the tender
offer is sought, offered
or permitted.”
[24]
It is difficult to conclude that this provision
relates to omissions such as a failure to submit documents that are
necessary in
order for a tender to be regarded as responsive. If the
provision were interpreted in that way it would allow nonresponsive
bids
to be adjusted to be responsive, thus changing the competitive
position of tenderers, which is the antithesis of the stated purpose
of the paragraph. I am in agreement with the first respondent
that paragraph F.2.17 provides for the first respondent to
seek
clarification in respect of obvious errors contained in a tender. But
in any event, I am of the view that, on the whole, the
tender
documents place the bulk of the onus of seeking clarification upon
the tenderer.
[25]
Even if the applicant were correct regarding the
alleged ambiguity as an explanation for its failure to submit
Annexure C4, there
remains no explanation for its failure to complete
and return any of the annexure E documents accompanying each of the
annexure
C documents. It will be remembered that this failure was
also mentioned in the outcome letter of 31 January 2022. As the first
respondent states, this omission on its own renders the applicant’s
tender nonresponsive.
[26]
The omissions highlighted above from the
applicant’s tender mean that the tender has failed to comply
with the specifications
and conditions of the tender set out in the
tender documents, as defined in section 1 of the PPPFA.
[27]
I now turn to the additional challenges based on the
Afribusiness
case and the first respondent’s failure to afford the applicant
an internal appeal in terms of section 62 of the Systems
Act.
[28]
Regarding
the applicant’s reliance on the Constitutional Court case of
Minister
of Finance v Afribusiness,
it
is clear that the Constitutional Court judgment must be read together
with the Supreme Court of Appeal (“
SCA”
)
judgment, because the former simply dismissed the appeal launched in
respect of the latter. And the order granted in the SCA judgment
was
to
declare
the 2017 Regulations inconsistent with the PPPFA and
invalid; and to
suspend
the declaration of invalidity for a period of 12 months from the date
of that order. As appears from the SCA judgment
[7]
,
the suspension was to allow the Minister of Finance
to
remedy the defects, as contemplated in section 172(1)(b)(ii) of the
Constitution. The operation of the declaration of invalidity
is
therefore currently in suspension
to allow the Minister of Finance
to
remedy the defects, and the defects that were the subject of those
proceedings directly related to Regulations 3(b), 4 and 9.
Although
the SCA did not
make an order limiting the retrospective effect of the declaration of
invalidity in terms of section 172(1)(b)(i), the judgment
cannot
be read to include the current tender within its ambit because the
applicant’s tender was invited, submitted, considered
and
determined before the Constitutional Court judgment was delivered.
The consequence is that the applicant cannot claim to have
a right -
prima
facie
or clear - to the relief granted in
Afribusiness.
[29]
To
put it differently, if the applicant wanted to launch proceedings
challenging the constitutionality and validity of the 2017
Regulations, it could have done so before now. It did not need the
Constitutional Court
Afribusiness
judgment in order to do so. Otherwise, the applicant would not need
to launch fresh proceedings seeking the declaration of invalidity
and
unconstitutionality that it now seeks. And the constitutionality
challenge that is now relied upon did not arise from the first
respondent’s decision of 31 January 2022. Although the
applicant states in its supplementary founding affidavit that it
decided to raise the constitutionality challenge as a result of the
Constitutional Court’s decision of 16 February 2022, the
challenge to Regulation 8, which is the subject of these proceedings
did not directly arise in
Afribusiness
.
The impugned regulations in that case were Regulations 3(b), 4 and
9.
[30]
Nevertheless,
the applicant is of course entitled to launch proceedings challenging
the constitutionality of Regulation 8 of the
2017 Regulations.
However, that issue does not arise for determination before me,
although
it is relevant in the consideration of whether the applicant bears
strong prospects of success in the review. As I have
indicated above,
that issue does not amount to a right for purposes of the interim
relief sought in these proceedings because,
amongst other reasons, it
clearly envisages separate or additional legal proceedings from those
in
Afribusiness
.
It is not a right
that
is threatened by an impending or imminent irreparable harm
,
and
to which, if not
protected by an interdict, irreparable harm would ensue.
On
the whole, I am of the view that, although the constitutionality
challenge might well have good prospects of success, it is not
sufficient reason to halt the tender process and grant interim relief
in this case.
[31]
I
now turn to the applicant’s challenge regarding the applicant’s
failure
to
afford it an internal appeal in terms of section 62 of the Systems
Act
.
As I have already indicated, this challenge was raised for the first
time in
the
replying affidavit and was pursued further in its heads of argument.
On the basis of this challenge the applicant states that,
at the very
least an interdict should be granted pending the outcome of the
section 62 appeal which the first respondent should
be directed to
process immediately whilst the remainder of the review proceeds. The
first respondent complains that the applicant’s
case in this
regard should have been raised in the founding papers, in order to
afford it (first respondent) an opportunity to
deal with it. But in
any event, the first respondent’s stance is that the decision
in respect of the appeal as contained
in the letter of 25 February
2022, even if incorrect, is a decision already made, which can only
be set aside by a court order,
on the authority of
Oudekraal
[8]
.
[32]
Indeed, the manner in which the applicant has
raised the challenge regarding the first respondent’s failure
to afford it an
internal appeal has not been satisfactory. It is
common cause that no appeal was afforded to the applicant, for the
reasons stated
in the letter of 25 February 2022. Yet the basis on
which the applicant approached this Court for urgent interdictory
relief did
not include a challenge in that regard. The founding
papers took the fact that no appeal was afforded as a fact. As
the founding
affidavit states, the basis for the interdictory relief
sought is mostly similar to the content of the appeal that it lodged.
[33]
The result of the manner in which
the applicant has raised this issue is that this Court has not had
the benefit of a version on
affidavit from the first respondent in
this regard. Instead, the Court has the benefit of the applicant’s
case, which is
fully ventilated in the heads of argument. No
explanation is given for why this ground, which would have been the
foremost
basis for the interdictory relief if it was challenged, is
not mentioned in the founding papers. It is not a new fact which
arose
after the launching of the proceedings, or which arose from the
first respondent’s papers. The fact that it is common cause
between the parties that no appeal was afforded to the applicant does
not mean that the first respondent was supposed to assume
in its
answering papers that it is challenged. The prejudice to the first
respondent in this regard is patent. It is trite that
an applicant
must make out its case in the founding papers. Contrary to this
principle, the extent to which the applicant’s
case has evolved
since the launching of the founding papers is apparent from the heads
of argument delivered on its behalf. The
principle is especially
applicable to the facts of this case which was brought on an
extremely urgent basis, thus giving the first
respondent little time
in which to deliver answering papers. It is patently unfair in those
circumstances to amend the case as
the applicant did here. In
reaching a conclusion in this regard, I am mindful that the applicant
may raise this issue as a ground
of review in due course. I am also
mindful of the first respondent’s stance based on
Oudekraal
in this regard.
[34]
Before
concluding the discussion regarding the
prima
facie
right requirement, i
t
is my observation that the applicant’s main basis in this
regard is the merits of the review which is to be heard as Part
B to
this application. However, as the Constitutional Court cautioned in
OUTA
[9]
,
“
the
prima facie right a claimant must establish is not merely the right
to approach a court in order to review an administrative
decision. It
is a right to which, if not protected by an interdict, irreparable
harm would ensue. An interdict is meant to
prevent future conduct and
not decisions already made. Quite apart from the right to review and
to set aside impugned decisions,
the applicants should have
demonstrated a prima facie right that is threatened by an impending
or imminent irreparable harm.”
[35]
I am similarly not persuaded that the balance of
convenience favours granting the order in favour of the applicant. It
is not disputed
that the services that form the subject of these
proceedings are critical, and amount to basic municipal services. In
this regard,
the first respondent states that the relief sought
directly impacts on its constitutional obligation to fulfill its
cardinal function
of providing basic services to its residents in
terms of section 152(1) of the Constitution. Concomitantly, the
residents
of Rawsonville have a right to a healthy environment as
well as sufficient water, both of which would be affected by the
relief
sought by the applicant, together with the residents’
right to dignity.
In addition,
the first
respondent points to the nature of the tender, namely the extension
of wastewater treatment works, stating that the interim
relief sought
by the applicant is far-reaching and would be catastrophic for the
first respondent and its residents. This is especially
the case since
the relief sought by the applicant makes no provision for interim
services to be provided once the interim interdict
is granted.
Furthermore, it is common cause that the first respondent does not
have independent internal capacity to generate sufficient
revenue
from rates and levies for projects such as the tender that is the
subject of these proceedings, and that it is reliant
upon the
Municipal Infrastructure Grant (“
the
MIG”
), which is a once-off
allocation that must be utilised within its allocation cycle. It is
also undisputed that, the first respondent
has in fact obtained the
MIG funding for purposes of this tender, and that if the funding is
not utilized now, during its allocation
year, it will be lost and the
project will have to be abandoned.
[36]
Having regard to all the factors relied upon
by the first respondent, I am not persuaded that there is prudence in
halting those
services pending final determination of the applicant's
review which could span a considerable amount of time, especially
given
the applicant’s additional reliance on the constitutional
challenge discussed earlier. The prejudice to be suffered by the
first respondent and the residents of Rawsonville if the relief were
granted outweighs the prejudice cited by the applicant, which
amounts
to financial prejudice. The significance of the project itself to the
residents of Rawsonville outweighs the financial
loss to the
applicant especially in circumstances where the applicant has failed
to meet the stated requirements of the tender.
[37]
I have considered the applicant’s
reply in this regard, to the effect that the work merely entails a
physical extension to,
and upgrade of the existing wastewater
treatment works in Rawsonville, and that it does not mean that until
such time as the work
has been completed the citizens of Rawsonville
will be without wastewater treatment plant at all. Nevertheless, the
importance
of the services involved cannot be underrated. The
cardinal importance of these municipal services was highlighted in
Joseph v City of Johannesburg
,
where the Constitutional Court stated as follows:
“
The
provision of basic municipal services is a cardinal function, if not
the most important function, of every municipal government.
The
central mandate of local government is to develop a service delivery
capacity in order to meet the basic needs of all inhabitants
of South
Africa, irrespective of whether or not they have a contractual
relationship with the relevant public service provider.
The
respondents accepted that the provision of electricity is one of
those services that local government is required to provide.
Indeed
they could not have contended otherwise. In Mkontwana, Yacoob J
held that “municipalities are obliged to
provide
water and electricity to the residents in their area as
a matter of public duty.” Electricity is one
of the most common
and important basic municipal services and has become virtually
indispensable, particularly in urban society.”
[10]
[38]
By contrast, the loss to be suffered by the
applicant is mostly financial in nature, although it also places
reliance on section
217 of the Constitution, that the work awarded to
a contractor must be in accordance with the procurement system which
is fair,
equitable, transparent, competitive and cost-effective.
However, section 217 also weighs in the first respondent’s
favour.
Given that its case is that the applicant’s tender was
non-responsive and therefore failed to meet the requirements of the
tender in terms of section 1 of the PPPFA, this too attracts the
application of section 217 of the Constitution.
On
the whole, I am not persuaded that the balance of convenience weighs
in favour of granting the interim relief to the applicant.
[39]
The applicant’s counsel argued that if the
interim order is not granted, but it later turns out that it should
have been,
then the loss suffered by the applicant will be
irreparable. Further, that if the interim relief is not granted it
will suffer
irreparable harm in that the third respondent will
commence with the supply and installation of the works, which the
applicant
is entitled to do. Moreover, it was argued on behalf of the
applicant that there is no loss to be suffered by the respondents if
the tender award processes are temporarily stopped but the applicant
is later proved to be correct. In this regard, the applicant
relies
on loss of income for which it will not be able to sue for damages.
As I have already indicated, I am of the view that the
prejudice to
be suffered by the respondents and the residents of Rawsonville
outweighs the alleged losses to be suffered applicant,
which, I
emphasise amount to financial loss. Furthermore, it is not correct
that no loss is to be suffered by the first respondent.
As I have
already mentioned, it is not disputed that the MIG funding for the
project will be lost if the project is halted. As
the first
respondent states, it is only the applicant that stands to gain
something by the granting of the interim relief. The
possible loss of
its income is not adequate for this Court to come to its assistance
on the facts before me.
[40]
Given the shortcomings I have discussed in this
judgment regarding the interim relief sought, I am of the view that
an expedited
review would provide adequate relief as alternative
remedy to the applicant. In this regard, I take into account that
most of the
items raised by the applicant are issues that may
properly be ventilated on review.
[41]
I
am cognizant of the body of caselaw which promotes the weighing up of
a sliding scale of the relevant factors when exercising
my discretion
in granting an interim interdict.
[11]
However, based on the considerations discussed above, I
am
unable to come to the applicant’s assistance.
I
have not found grounds to halt the tender process and grant interim
relief in the meantime.
[42]
There is no reason why costs should not
follow the result.
V.
ORDER
[43]
In the circumstances, I make the following
order:
a.
The applicant’s application in Part A is dismissed.
b.
The applicant shall pay the first and second respondents’
costs
in Part A.
N.
MANGCU-LOCKWOOD
Judge
of the High Court
## [1]Setlogelo
v Setlogelo1914
AD 221at
227;National
Treasury and Others v Opposition to Urban Tolling Alliance and
Others(CCT
38/12) [2012] ZACC 18; 2012 (6) SA 223 (CC); 2012 (11) BCLR 1148
(CC) (20 September 2012) (“OUTA”)
paras [41] – [45].
[1]
Setlogelo
v Setlogelo
1914
AD 221
at
227;
National
Treasury and Others v Opposition to Urban Tolling Alliance and
Others
(CCT
38/12) [2012] ZACC 18; 2012 (6) SA 223 (CC); 2012 (11) BCLR 1148
(CC) (20 September 2012) (“
OUTA”
)
paras [41] – [45].
[2]
Webster
v Mitchell
1948
(1) SA 1186
(W).
[3]
Gool
v Minister of Justice and Another
1955
(2) SA 682
(CPD);
Molteno
Brothers and Others v South African Railways and Others
1936
AD 321
at
329 and 331; OUTA
paras
[41] – [45].
## [4]Economic
Freedom Fighters v Gordhan and Others; Public Protector and Another
v Gordhan and Others(CCT
232/19; CCT 233/19) [2020] ZACC 10; 2020 (8) BCLR 916 (CC); 2020 (6)
SA 325 (CC) (29 May 2020) para [42].
[4]
Economic
Freedom Fighters v Gordhan and Others; Public Protector and Another
v Gordhan and Others
(CCT
232/19; CCT 233/19) [2020] ZACC 10; 2020 (8) BCLR 916 (CC); 2020 (6)
SA 325 (CC) (29 May 2020) para [42].
[5]
OUTA
para
[50].
[6]
OUTA
para
[46].
[7]
At
para [46].
[8]
Oudekraal
Estates (Pty) Ltd v City of Cape Town and Others
2004
(6) SA 222 (SCA).
[9]
At
para [50].
[10]
Footnotes
omitted.
[11]
See in this regard
Olympic
Passenger Service (Pty) Ltd v Ramlagan
1957
(2) SA 382
(D)
at 383 C – F
sino noindex
make_database footer start
Similar Cases
Sakhana Construction CC v Strand Junction Retail (Pty) Limited (4219/2022) [2022] ZAWCHC 225 (3 November 2022)
[2022] ZAWCHC 225High Court of South Africa (Western Cape Division)98% similar
Construction Company (Pty) Ltd v City of Cape Town and Others (2950/2024 ; 22591/2023) [2025] ZAWCHC 552 (26 November 2025)
[2025] ZAWCHC 552High Court of South Africa (Western Cape Division)98% similar
Lead Engineering and Projects (Pty) Ltd v Swe Repco SA (Pty) Ltd and Others (16567/2022) [2023] ZAWCHC 77 (18 April 2023)
[2023] ZAWCHC 77High Court of South Africa (Western Cape Division)97% similar
South African Legal Practice Council and Another v Nonxuba and Others (10313/2021) [2022] ZAWCHC 105 (18 April 2022)
[2022] ZAWCHC 105High Court of South Africa (Western Cape Division)97% similar
Paulsen and Another v JP Markets SA (Pty) Ltd and Another (11210/23) [2025] ZAWCHC 428 (15 September 2025)
[2025] ZAWCHC 428High Court of South Africa (Western Cape Division)97% similar