Case Law[2024] ZAKZDHC 90South Africa
APM Terminals BV v Transnet SOC Limited and Others (Leave to Appeal) (D3052/2024) [2024] ZAKZDHC 90 (11 December 2024)
Judgment
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# South Africa: Kwazulu-Natal High Court, Durban
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## APM Terminals BV v Transnet SOC Limited and Others (Leave to Appeal) (D3052/2024) [2024] ZAKZDHC 90 (11 December 2024)
APM Terminals BV v Transnet SOC Limited and Others (Leave to Appeal) (D3052/2024) [2024] ZAKZDHC 90 (11 December 2024)
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sino date 11 December 2024
IN
THE HIGH COURT OF SOUTH AFRICA
KWAZULU-NATAL
LOCAL DIVISION, DURBAN
Case
no:
D3052/2024
In
the matter between:
APM
TERMINALS
BV
APPLICANT
and
TRANSNET
SOC LIMITED
FIRST RESPONDENT
INTERNATIONAL
CONTAINER TERMINAL
SECOND RESPONDENT
SERVICES
INC
COSCO
SHIPPING PORTS LIMITED
THIRD RESPONDENT
DP
WORLD LIMITED
FOURTH RESPONDENT
GLOBAL
PORTS SERVICES PTE LIMITED
FIFTH
RESPONDENT
RED
SEA GATEWAY TERMINAL
SIXTH RESPONDENT
MMC
PORT HOLDINGS SDN BHD
SEVENTH RESPONDENT
TERMINAL
INVESTMENT LIMITED
EIGHT RESPONDENT
REMGRO
LIMITED
NINTH RESPONDENT
Coram
:
Mossop J
Heard
:
4 December 2024
Delivered
:
Utilising the parties’ representative’s email addresses,
this
judgment
was handed down electronically at 09h00 on Wednesday, 11 December
2024 and was contemporaneously released to SAFLII.
ORDER
The
following order is granted:
1.
The second respondent’s application for condonation
for the
late delivery of its application to amend its notice of application
for leave to appeal is granted
and there shall be
no order as to costs.
2.
The second respondent’s notice of application
for leave to
appeal is amended to reflect that the second respondent relies upon s
17(1)
(a)
(i) and
s 17(1)
(a)
(ii) of the
Superior Courts
Act 10 of 2013
in seeking leave to appeal.
3.
The second respondent’s application
for leave to appeal
is dismissed with costs, such to include the costs of two counsel and
which costs are to be taxed on scale
C.
JUDGMENT
MOSSOP
J:
Introduction
[1]
This is an application for leave to appeal against an
order that I
granted on 9 October 2024 after hearing argument in an opposed urgent
application (the opposed application). Despite
the applicant in that
application identifying nine respondents in its founding papers, the
only respondents that participated in
the opposed application were
the first, second, and eighth respondents.
[2]
To avoid confusion, when referring to a party in this
judgment, I
shall refer to them as they were referred to in the founding papers
in the opposed application. The consequence of
this approach is that,
counterintuitively, the applicant in this application for leave to
appeal shall be referred to as ‘the
second respondent’
and the respondent in this application shall be referred to as ‘the
applicant’.
The
notice of motion
[3]
The
applicant’s notice of motion in the opposed application was
divided into Part A and Part B. Part A was an interim
interdict that
was sought pending the final determination of a review. The review
itself formed the subject matter of Part B. I
was only required to
determine the relief sought in Part A.
[1]
The
order granted
[4]
After hearing argument over two days, I granted the following
order
(the order):
‘
1.
The application is regarded as urgent and the applicant's failure to
comply with the Uniform Rules
of Court and the Practice Directives of
this division is condoned.
2.
The question of law raised by the eighth respondent
in accordance
with the provisions of Uniform rule 6(5)
(d)
(iii) is dismissed
with costs, such to include the costs of two counsel and to be taxed
on scale B.
3.
Pending the final determination of Part B of this application, the
first respondent is interdicted
from:
3.1
taking any steps, alternatively any further steps, to implement the
decision taken by it on 1 March 2024 to award the tender Request for
Proposal: Durban Container Terminal Pier 2 (DCT2) (RF Number
TCC/PSP/2022/0003/RF) (the tender) to the second respondent;
3.2
negotiating or concluding any contract with the second respondent
or
any third party; or
3.3
implementing, or further implementing, as the case may be, any such
contracts, in relation to the tender.
4.
The first and second respondents are directed to
pay the applicant’s
costs, jointly and severally, the one paying the other to be
absolved, including the costs of two counsel
where so employed, to be
taxed on Scale C.
5.
To the extent necessary, the parties are granted
leave to approach
the Judge President, alternatively the senior civil judge, in order
to make representations concerning a preferent
date being allocated
for the hearing of Part B of this application.’
[5]
Save for the addition by me of paragraphs 2 and 5 to
the order, the
remainder of the order conformed with the relief sought in Part A of
the applicant’s notice of motion. Paragraph
2 of the order
related to a question of law raised by the eighth respondent, while
paragraph 5 of my order invited the parties
to approach the Judge
President of this division to arrange a preferent date for the
hearing of Part B of the application, if so
advised. I did not
require such an approach to occur, but merely smoothed the path for
the parties if they wished to seek preference
from the Judge
President.
The
invitation accepted
[6]
The parties availed themselves of that invitation and
approached the
Judge President. Part B has now been set down for argument as a
special opposed motion in Durban to be heard over
two days, namely 12
and 13 March 2025. The date of this hearing appears from a notice of
set down which has found its way into
the court file, and which is
dated 27 November 2024.
Participation
in this application for leave to appeal
[7]
The first respondent, Transnet SOC Ltd, being the party
that was
interdicted from proceeding with the implementation of its tender by
the order, has elected not to seek leave to appeal.
The same applies
to the eighth respondent, which has chosen not to seek leave to
appeal paragraph 2 of the order.
[8]
The only party, therefore, that has sought leave to appeal
is the
second respondent.
[9]
In my view, the fact that the first respondent has not
chosen to seek
leave to appeal the order is of some significance to this
application.
The
application for leave to appeal
[10]
The second respondent delivered its notice of application for leave
to appeal
on 30 October 2024, prior to delivery of the notice of set
down for Part B. Upon receiving the notice of set down, which
indicated
that the review would be heard on 12 and 13 March 2025, it
appeared unlikely to me that, in the event of leave to appeal being
granted, the appeal process would be finalised before the first of
those dates.
[11]
I accordingly wrote to the parties on 29 November 2024 to ascertain
whether
the application for leave to appeal would be persisted with,
given the preferent date of hearing allocated for Part B. I received
a written reply from the second respondent’s attorneys
indicating that the application for leave to appeal would proceed,
as
scheduled, on Wednesday, 4 December 2024.
The
amendment
[12]
In its
notice of application for leave to appeal, the second respondent
initially confined its application for leave to appeal to
the
provisions of s 17(1)
(a)
(i)
of the Superior Courts Act 10 of 2013 (the Act).
[2]
That limitation was noted and commented upon by the applicant in its
heads of argument. On the same day that I wrote to the parties,
Friday, 29 November 2024, a notice of amendment was delivered
indicating that the second respondent intended amending its
application
for leave to appeal to also place reliance on s
17(1)
(a)
(ii)
of the Act. At the insistence of the applicant, an application for
condonation was delivered by the second respondent on 2
December
2024.
[13]
Having considered the application for condonation, the fact that it
will occasion
no prejudice to any party and that the condonation
application has not been opposed by the applicant, I was, in the
circumstances,
disposed to grant it and did not find it necessary for
Mr Stein SC, who appears for the second respondent together with Ms
Palmer,
to address me on the issue when the matter was called.
[14]
The second respondent’s notice of application for leave to
appeal will
consequently be amended to reflect that the second
respondent also relies on s 17(1)
(a)
(ii) of the Act in
seeking leave to appeal.
Is
the order appealable?
[15]
Given that the order granted is clearly interlocutory in its nature,
the obvious
question that arises before all others is whether the
order is appealable. As may be anticipated, the second respondent
claims
that it is, while the applicant claims that it is not.
[16]
In general, interlocutory orders are not appealable. From its terms,
the order
is to only endure until such time as Part B of the
application has been determined and it is, therefore, temporary in
its nature
and will only be in place for a limited period. The date
upon which the determination of the review is to commence is now
known
and has been fixed by the notice of set down to which I
previously referred.
[17]
The
locus
classicus
on the topic of appealability of interim orders is
Zweni
v Minister of Law and Order
,
[3]
where the then Appellate Division ruled against the appealability of
an interim order made by the court of first instance. It tested
the
interim order against (i) the finality of the order; (ii) the
definitive rights of the parties; and (iii) the effect of disposing
of a substantial portion of the relief claimed in the main
application.
[18]
The
approach advocated in
Zweni
has
been gradually modified over time. In
Philani-Ma-Afrika
and others v Mailula and others
,
[4]
the Supreme Court of Appeal held that the interests of justice were
paramount in deciding whether orders were appealable, with
each case
being considered upon its own facts. The development of the law in
this direction is further demonstrated in
National
Treasury and others v Opposition to Urban Tolling Alliance and
others
,
[5]
where the Constitutional Court stated that whether leave to appeal
will be granted in respect of interim orders is based upon the
interests of justice, requiring a weighing up of circumstances,
including whether the interim order has a final effect. In
Tshwane
City v Afriforum and another
,
[6]
the Constitutional Court stated that:
‘
[40] …Unlike
before appealability no longer depends largely on whether the
interim order appealed against has final
effect or is dispositive of
a substantial portion of the relief claimed in the main application.
All this is now subsumed under
the constitutional interests of
justice standard. The overarching role of interests of justice
considerations has relativised
the final effect of the order or the
disposition of the substantial portion of what is pending before the
review court, in determining
appealability…
[41]
… If appealability or the grant of leave to appeal would best
serve the interests of justice, then the appeal should
be proceeded
with no matter what the pre-Constitution common-law impediments might
suggest…’ (Footnotes omitted.)
[19]
The second respondent contends that the order is final in its effect.
It states
in its notice of application for leave to appeal that:
‘
The
Order is final in effect. It is not susceptible to alteration by the
court of first instance. It is definitive of the rights
of the
parties in Part A of the proceedings. It has the effect of disposing
of the entire Part A relief.’
[20]
As Mr Maenetje SC, who appears for the applicant together with Mr
Gwala, states
in the applicant’s heads of argument, that
submission does not conform to the test defined in
Zweni
. The
third and final requirement of the test postulated in
Zweni
holds that what must be disposed of is a substantial portion of the
relief claimed in the main proceedings, not the relief claimed
in the
interim interdict. That criticism is valid, in my opinion.
[21]
As to
whether an interim order is to be viewed as having final effect, the
mechanism for assessing this was considered in
City
of Cape Town v South African Human Rights Commission.
[7]
The court found that:
‘
The
first enquiry is to ascertain whether the orders granted by the high
court have a final effect. For this it is necessary to
compare the
orders granted in respect of Part A and the orders sought in Part B,
to ascertain to what extent they overlap.’
[22]
To perform this exercise, it is necessary to consider the relief
claimed in
Part A and Part B. The relief set out in Part A has
already been considered when the order granted was discussed. The
relief claimed
in Part B is as follows:
‘
1.
The decision of the first respondent made on or about 1 March 2024 to
award the Tender to the second
respondent and to proceed to finalise
the contract award is reviewed, set aside, and declared invalid
(“Impugned Decision”).
2.
It is declared that the applicant is the preferred bidder as
contemplated in the Tender.
3.
The first respondent is directed to forthwith implement the
declaration in paragraph 2 as
contemplated in the Tender.
4.
Alternatively to 2 and 3 above
, the matter is remitted back to
Transnet for reconsideration.
5.
The costs of Part B of this application shall be paid by any
respondent opposing any part
of the relief sought, including the
costs of two counsel.’
[23]
None of the
relief sought in Part A is final in effect in my view and no
irreparable harm or grave injustice will occur should Part
A remain
in place until Part B is determined.
[24]
The
second respondent submits further that it is in the interests of
justice that it be granted leave to appeal.
I
was referred to several decisions in which the interests of justice
were considered and applied.
However,
in
TWK
Agriculture Holdings (Pty) Ltd v Hoogveld Boerderybeleggings (Pty)
Ltd and others
,
[8]
a matter decided in 2023, Unterhalter AJA observed that:
‘
Recent
decisions of this court that may have been tempted into the general
orbit of the interests of justice should now be approached
with the
gravitational pull of
Zweni
.’
[9]
[25]
In
United
Democratic Movement and another v Lebashe Investment Group (Pty) Ltd
and others
,
[10]
the
Constitutional Court acknowledged that if all the
Zweni
requirements
were not met, leave to appeal could still, nonetheless, be granted if
it was in the interests of justice to do so.
Thus, Unterhalter AJA acknowledged in
Polokwane
Municipality v Double Four Properties and another;
Broadlands
Home Owners Association NPC v Double Four Properties and another
,
[11]
that if ‘[t]he
Zweni
test is not satisfied, and no consideration relevant to the interests
of justice tilts the balance in favour of the applicants’,
then
the test for appealability has not been made out.
[26]
In my view, the order does not dispose of anything that is still to
be determined
in the review application nor is it definitive of the
rights of the parties. The relief claimed in Part A is therefore not
final
in effect. It appears to me that on a proper application of the
test formulated in
Zweni
, the matter is therefore not
appealable. In addition, I cannot conceive that it would be in the
interests of justice to permit
an appeal against an interim interdict
where the party that was primarily interdicted has not itself sought
leave to appeal that
order and is content to have it in place until
Part B is heard in approximately three months’ time, as agreed
to by all the
participating parties.
[27]
I conclude, therefore, that the order that I granted, as seen against
the factual
matrix of this matter, is not appealable.
[28]
I may, however, be incorrect in coming to that conclusion.
Acknowledging that,
I must, in the circumstances, consider the
specific grounds raised by the second respondent in its notice of
application for leave
to appeal.
The
grounds advanced in support of the application for leave to appeal
[29]
In total, there are eight grounds upon which I am alleged by the
second respondent
to have misdirected myself in granting the order.
As pointed out by the applicant in its heads of argument, the second
respondent’s
notice of application for leave to appeal is a
substantial document, being comprised of over 100 paragraphs spread
across some
37 pages. I do not intend trawling through every one of
the many allegations made therein but shall confine myself to briefly
considering
the principal allegations.
[30]
In doing so, I do not spend time on the test applicable when
considering an
application for leave to appeal. It is a matter of
common legal knowledge that the standard has been elevated and I need
not involve
myself in revisiting the test. The test has, in any
event, been fully and correctly summarised in the heads of argument
prepared
by Mr Maenetje. I continue to bear the test in mind when
considering the grounds of appeal.
The
first ground of appeal
[31]
It is alleged that I made findings against the second
respondent which
were not borne out by the evidence adduced.
Specifically, the second respondent has identified certain
statements, words, and descriptions
that I employed in my judgment
with which it does not agree. I consider a few of them.
[32]
I indicated in my judgment that the second respondent could not ‘in
good
conscience’ submit that its response to the solvency ratio
calculation required by the provisions of the tender was true or
accurate, because by knowingly changing the inputs into the
prescribed calculation, the second respondent had ‘perverted’
the solvency ratio calculation crafted by the first respondent and it
could not be verified as being correct.
[33]
It was
never in dispute that the second respondent did not complete the
solvency ratio calculation prescribed by the first respondent
in the
manner intended by the first respondent. The second respondent
changed the prescribed calculation by using a value in the
equation
that was not prescribed. The solvency ratio calculation had therefore
not been calculated as required by the first respondent
and, because
of that fact, no third party could verify that what had been
calculated was correctly calculated. The calculation
was thus changed
from what it was meant to be to something that the second respondent
wanted it to be.
[12]
Based on
my understanding of the word ‘pervert’,
[13]
the meaning of which is considered as a footnote below, that
conduct amounted to an act of perversion by the second respondent.
I
therefore described it as such.
[34]
The second respondent also takes issue with my mentioning that Sycip
Gomes
Velayo and Company (SGV) of Makati City, Philippines, was an
accounting firm that had provided verification of the second
respondent’s
solvency statements and was:
‘…
apparently a member firm
of EY, one of the four big accounting firms’.
The
complaint is that the use of the word ‘apparently’
allegedly has an innuendo attaching to it, suggesting a ‘pretence’
created by the second respondent.
[35]
The
complaint, in my view, is both imagined and strained. There was no
requirement that an entity providing the verification of
a bidder’s
solvency had to be a member of the big four accounting firms. No
member of SGV deposed to an affidavit in the
matter and its
membership of EY has accordingly not been conclusively established.
In truth, the status of SGV was not an issue
in the determination of
the application. The information that SGV was ‘[a] member firm
of Ernst and Young Global Limited’,
was gleaned by me from the
smallest of fine print at the base of SGV’s letterhead. Two
examples of that letterhead appear
in the indexed papers.
[14]
Mr Stein very helpfully ascertained during argument that a positive
averment of this fact is also contained in the second respondent’s
answering affidavit. Accepting at face value what is stated on the
letterhead, SGV is, indeed, apparently a member of EY. No innuendo
attaches to that statement nor was any intended.
[36]
A further point taken by the second respondent is that I stated that
had the
second respondent applied the solvency ratio calculation as
the first respondent had intended it to be applied, and as it was
understood
and applied by all the other bidders, it would have fallen
‘dismally short’ of the prescribed outcome of 0.4 or
above,
and by adapting and varying the calculation, as it admitted
that it did, it achieved a ‘spectacular’ outcome of 1.26.
The use of the words ‘dismally’ and ‘spectacular’
is the target of a further complaint by the second respondent.
[37]
The second respondent acknowledged that had it calculated the
solvency ratio
calculation as the other bidders did, it would have
achieved a solution of 0.24. That was substantially below the
required outcome
of 0.4. In my view, that solution fell dismally
short of what was required. The second respondent may not approve of
my use of
the word ‘dismally’, but it is a word that I
chose to use, and it is apposite.
[38]
As regards the ‘spectacular’ result achieved by
calculating the
solvency ratio calculation the way that it did, the
second respondent argues in its heads of argument that:
‘…
such a conclusion could
not have been reached as there was no evidence about the respective
scores of any of the other bidders on
which to conclude that ICTSI’s
score was “spectacular” in any way.’
[39]
This argument has two fundamental shortcomings, in my view. Firstly,
no other
party calculated the solvency ratio calculation the way the
second respondent did. No meaningful comparison is therefore capable
of being performed with regard to other bidders. And, secondly, as
the first respondent’s internal audit team’s report
stated:
‘
An
equity-to-assets ratio above one (1) should have been a red flag for
the CFAT, as it is impossible.’
Obtaining
a result that is impossible merited the description that I gave it.
[40]
I have spent some time dealing with some of the complaints raised by
the second
respondent over, essentially, my vocabulary in this ground
of appeal. In doing so, it is evident that this ground of appeal is
entirely frivolous. In truth, I need not have spent time on this
exercise because these complaints relate to the reasoning that
I
adopted in coming to the conclusion that I reached and do not arise
out of the order that I granted.
[41]
In
Absa
Bank Limited v Mkhize
,
[15]
the Supreme Court of Appeal confirmed that an appeal lies only
against an order of a court and not against the reasons for that
order. This approach was confirmed in
Lebea
v Menye and another,
[16]
where the Constitutional Court stated that:
‘
It
must also be remembered that there is no appeal against reasons for a
judgment and an appeal lies only against an order.
’
The
second ground of appeal
[42]
I am alleged by the second respondent to have failed to recognise
that the
applicant had challenged the incorrect decision, it being
alleged that the decision that ought to have been challenged was the
decision to shortlist the second respondent as the preferred bidder
and not the decision to finally award the tender to it and to
conclude the final contract with it (the contract).
[43]
I deferred
the resolution of that issue to the court hearing the review
application. I was not entitled to come to any findings
that might
serve to bind the court hearing the review application and this was
an issue that I believed should be considered by
the court hearing
the review application. The best that I could do was to take a ‘peek’
at the issues in the review
application.
[17]
[44]
In my view, on the evidence before me, it was clear that the
shortlisting decision
was not a final decision, a fact accepted by
the first respondent, which designed the tender. Indeed, the first
respondent’s
legal representatives, acting on its behalf, on
several occasions expressed that view in writing, urging the
applicant not to commence
legal proceedings because the process of
shortlisting did not amount to a final decision. Of relevance in this
regard is the first
respondent’s legal representatives’
letters to the applicant’s legal representatives dated 2
November 2023, 8
November 2023, and 4 March 2024, in which this
position was unequivocally expressed. That correspondence has been
put up and forms
part of the record.
[45]
The first respondent accepted that the decision to finally award the
tender
to the second respondent and to conclude a contract with it,
referred to as ‘the 1 March decision’, which description
I shall also use, amounted to an administrative action on its part,
as contended for by the applicant. In my view, it clearly was.
The
final award and the conclusion of the contract were accordingly
capable of being interdicted pending the decision to review
the award
of the tender. It appeared to me that the correct decision had been
identified by the applicant, namely the 1 March decision.
[46]
In pressing this ground of appeal, the second respondent appears to
lose sight
of the fact that I was not required to determine anything
finally. I was required merely to consider whether interim relief
should
be granted pending the final determination of all the issues
in dispute without trespassing into the merits of the review
application
itself.
The
third ground of appeal
[47]
It is alleged by the second respondent that I incorrectly regarded
the application
as urgent, when I ought not to have come to such a
finding. Moreover, I concluded that urgency was to be assessed with
effect from
the 1 March decision, instead of the date upon which the
second respondent was shortlisted as the preferred bidder.
[48]
In finding
the matter to be urgent, I exercised the discretion that I was
granted by the Uniform Rules of Court.
[18]
That discretion is a wide discretion. That simply meant that I was
entitled:
‘…
to have regard to a
number of disparate and incommensurable features in coming to a
decision.’
[19]
[49]
Having concluded that the matter was urgent, I then heard the
application,
which, as previously stated, was fully argued over a
period of two days. The fact that I have a discretion, and my
subsequent exercise
of that discretion, cannot simply be wished away,
nor can the consequences of that decision. The direct consequence of
that discretion
being exercised is that the application was heard.
The issue of urgency is, therefore, essentially moot because the
matter has
been comprehensively and completely dealt with. If I
understood him correctly, Mr Stein agreed in argument that this was
the case.
[50]
A decision
to treat a matter as urgent does not finally determine the rights of
any of the parties nor does it dispose of a substantial
portion of
the relief claimed in the main proceedings, or, in fact, any of that
relief, as required by
Zweni
.
It simply amounts to a procedural ruling that the matter is to be
considered as being urgent and is to be dealt with accordingly.
It
is, in other words, not an appealable outcome.
[20]
The
fourth ground of appeal
[51]
It is alleged that I approached certain legal questions on the basis
that they
could be resolved as if they were factual issues. Several
allegations fall under the umbrella of this ground.
[52]
The first allegation appears to be that because the first respondent
did not
dispute that the 1 March decision amounted to an
administrative action, I simply found that to be the case. Factually,
this is
incorrect, and I did no such thing. The 1 March decision
confirmed the second respondent as being the successful bidder. It
was
on that date that the first respondent informed the applicant
that it would conclude the contract with the second respondent.
Objectively,
on the face of it, this was sufficient evidence to
establish that date as the date upon which the administrative action
was finalised.
That had nothing to do with the first respondent’s
own subjective belief as to when the administrative action was taken.
[53]
A further complaint raised by the second respondent is that I erred
in not
finding that the final decision was, in fact, the shortlisting
of the second respondent by the first respondent as the preferred
bidder. This submission fails to appreciate that, on the first
respondent’s own version, it did not automatically follow
that
the preferred bidder would ultimately be the entity with which it
would conclude the contract. There were further steps through
which
the second respondent had to first proceed before the decision to
appoint it became final. As much was said by the first
respondent’s
attorneys in their correspondence to the applicant’s attorneys
mentioned earlier in this judgment.
[54]
Finally, under this ground of appeal, it is argued that I erred in
concluding
that the solvency ratio calculation was prescriptive. I
found that it was mandatory. There was nothing in the bid document to
indicate
that it was not. Given the financial demands of the project,
the demonstration of the financial power of the successful bidder was
essential and it had to be demonstrated at the outset to permit a
bidder to progress deeper into the tender process. The first
respondent defined, as it was entitled to do, how that financial
capacity was to be established. In a tender where the emphasis
was on
financial strength, the solvency ratio calculation was mandatory.
The
fifth ground of appeal
[55]
The second respondent asserts that I incorrectly interpreted the
financial
criteria and the solvency ratio requirement in my judgment.
In particular, it is alleged that I erred in treating the minimum
financial
criteria as a basis for exclusion and I failed to consider
the issue of materiality. As with some of the other grounds of
appeal,
this ground has three subsets of complaint. I deal with each
of them sequentially.
[56]
Firstly, it is alleged that I erred in not recognising that solvency
could
be established by the second respondent adapting the solvency
ratio calculation as it did. The difficulty for the second respondent
on this issue is that it was required to complete the bid
documentation as the first respondent wanted it completed, not in a
fashion that best suited itself. Moreover, the RFQ bid document made
it clear that the solvency ratio calculation was to be completed
by
using information taken from a bidder’s financial statements
which had to be submitted. Market capitalisation does not
appear in
financial statements nor was its use in calculating the solvency
ratio calculation offered as an alternative to bidders
by the first
respondent. It was therefore not a permissible variable that the
second respondent was at liberty to use. The second
respondent was
required to establish its solvency in the way that the first
respondent prescribed.
[57]
Secondly, it is suggested that obtaining a result of 0.4 when solving
the solvency
ratio calculation was not mandatory. That flies in the
face of the equation itself which is clearly stated to be as follows:
‘
1.
Solvency is equal to or exceeds 0.4, as calculated by the following
formula:
Financial
Minimum Criteria 1: Solvency: Total Equity equal
to or exceeds 0.4’
(Total Assets)
[58]
Mr Stein
submitted in argument that the second respondent was entitled to
interpret the solvency ratio calculation in the way that
it did (by
substituting ‘Total Equity’ with ‘Market
Capitalisation’). The test when engaging in the interpretation
of a document is set out in the well-known case of
Natal
Joint Municipal Pension Fund v Endumeni Municipality
[21]
and requires
giving
effect to the plain language of the document, objectively ascertained
within its context.
That being the case, I remain unconvinced that there is merit in Mr
Stein’s submission.
[59]
Thirdly, it is submitted that I erred in interpreting section 5.2(d)
of the
RFQ document. That section dealt with a bidder’s minimum
financial criteria and included the solvency ratio calculation. It
provided that the minimum value of 0.4 had to be attained when
calculating the solvency ratio calculation. I do not foresee any
other possible interpretation of that section being possible other
than the one to which I came.
The
sixth ground of appeal
[60]
The second respondent asserts that I erred in finding that
non-compliance with
the solvency ratio calculation would be a proper
basis to exclude the second respondent from further participation in
the tender.
[61]
I found it to be mandatory for the solvency ratio calculation to be
answered
as the first respondent required it to be answered. The
consequence of not answering it in the prescribed fashion was the
possibility
of exclusion from the bid process. This was the view, as
well, of the first respondent’s own internal audit team when
asked
to express a view on the way the second respondent adopted the
solvency ratio calculation. Exclusion for want of compliance with
the
minimum financial criteria is rendered more likely, in my view, in a
tender such as this where it was essential that the first
respondent
was able to identify a prospective business partner that had the
appropriate financial credentials.
The
seventh ground of appeal
[62]
The second respondent alleges that I erred in finding that the three
letters
put up by three of the second respondent’s bankers
constituted ex post facto verification of the second respondent’s
financial capacity. The argument in this regard is premised on the
fact that the first respondent was entitled to carry out a due
diligence inspection on the second respondent and the provision of
the three letters formed part of the exercise of that entitlement.
[63]
It seems to me that this proposition is misconceived. Before a due
diligence
could be conducted, the second respondent had to first
satisfy the minimum financial criteria. It did not do that, yet it
was given
an opportunity later to do so. Its financial strength ought
to have been established at the commencement of the bid process, not
towards the end of that process.
The
eighth ground of appeal
[64]
It is alleged that the essentialia of an interim interdict were not
established
by the applicant and that I erred in concluding that they
had been. I have reconsidered the judgment, and I am not persuaded
that
I erred in concluding as I did.
Conclusion
[65]
Ignoring
for a moment my conclusion that the order is not appealable on the
principles established in
Zweni
,
I am unpersuaded that the grounds of appeal taken by the second
respondent would entitle me to grant it leave to appeal. I am
of the
view that there is no reasonable possibility that another court would
come to a different decision. That being the
case, I must,
nonetheless, still consider whether there is a compelling reason why
an appeal should be allowed.
[22]
That would entail a consideration of whether there is:
‘…
an important question of
law or a discreet issue of public importance that will have an effect
on future disputes.’
[23]
I
discern neither of these to be present in this matter. The question
of law that arises in this matter is a common one that has
been dealt
with in several judgments and the law on the issue is well developed
and certain. The mere fact that the tender ultimately
will involve
large sums of money does not make it an issue of pressing public
importance. I consider there not to be any compelling
reason why
leave to appeal should be granted.
[66]
In
assessing whether it is in the interests of justice to otherwise
permit an appeal, each case must be assessed in the light of
its own
peculiar facts.
[24]
In this
matter, the duration of the interim interdict is not an unknown
imponderable stretching into the distance, but dates have
already
been agreed to and fixed for the determination of the final relief.
And those dates are but three months away. Also to
be considered and
weighed up when assessing the interests of justice is the fact that
the first respondent, which is the party
interdicted and restrained
by the order, has not itself sought leave to appeal. In the light of
these facts, I conclude that it
is not in the interests of justice to
permit an appeal.
[67]
I conclude therefore that the application for leave to appeal must
accordingly
be dismissed.
Costs
[68]
Dealing firstly with the issue of condonation, the applicant did not
oppose
the second respondent’s application, and I can
accordingly see no reason why any costs order should therefore be
made. As
regards the merits of the application for leave to appeal,
this was a matter of some complexity and considerable importance to
the parties. Both the second respondent and the applicant have each
employed two counsel to bring and resist this application,
respectively. That is, perhaps, a good indication of the difficulty
of the matter and its importance to each of them. Costs must
follow
the result and must therefore include the costs of both counsel, to
be taxed on scale C.
The
order
[69]
I accordingly grant the following order:
1.
The second respondent’s application for condonation
for the
late delivery of its application to amend its notice of application
for leave to appeal is granted and there shall be no
order as to
costs.
2.
The second respondent’s notice of application
for leave to
appeal is amended to reflect that the second respondent relies upon s
17(1)
(a)
(i) and
s 17(1)
(a)
(ii) of the
Superior Courts
Act 10 of 2013
in seeking leave to appeal.
3.
The second respondent’s application for leave
to appeal is
dismissed with costs, such to include the costs of two counsel to be
taxed on scale C.
MOSSOP J
APPEARANCES
Counsel
for the first respondent:
Mr A
Stein SC and Ms T Palmer
Instructed
by:
Bowman
Gilfillan Incorporated
Sandton
Johannesburg
Locally
represented by
:
Bowman
Gilfillan
Ground
Floor
Compendium
House
5 The
Crescent
Westway
Office Park
Harry
Gwala Road
Westville
Durban
Counsel
for the applicant:
Mr
N H Maenetje SC and Mr M Z Gwala
Instructed
by:
Webber
Wentzel
90
Rivonia Road
Sandton
Johannesburg
Locally
represented by
:
Johnston
and Partners
2
nd
Floor, 81 Richefond Circle
Ridgeside
Office Park
Umhlanga
Rocks
[1]
See
Hix
Networking Technologies CC v System Publishers (Pty) Ltd and another
[1996] ZASCA 107
;
[1996]
4 All SA 675
(A) at 681 for the requirements for an interim
interdict.
[2]
Section
17(1)
(a)
reads
as follows:
‘
(1)
Leave to appeal
may
only be given where the judge or judges concerned are of the opinion
that:
(a)
(i)
the appeal would have a reasonable prospect of success; or
(ii)
there is some other compelling reason why the appeal should
be heard,
including conflicting judgments on the matter under
consideration’.
## [3]Zweni
v Minister of Law and Order1993
(1) SA 523 (A); [1993] 1 All SA 365 (A) (Zweni)
at 532I-533A.
[3]
Zweni
v Minister of Law and Order
1993
(1) SA 523 (A); [1993] 1 All SA 365 (A) (
Zweni
)
at 532I-533A.
[4]
Philani-Ma-Afrika
and others v Mailula and others
[2009] ZASCA 115
;
2010 (2) SA 573
(SCA) para 20. See also
S
v Western Areas Ltd and others
2005
(5) SA 214
(SCA) paras 25 and 26;
Khumalo
and others v Holomisa
[2002]
ZACC 12
;
2002 (5) SA 401
(CC) (
Khumalo
)
para 8.
[5]
National
Treasury and others v Opposition to Urban Tolling Alliance and
others
[2012] ZACC 18
;
2012 (6) SA 223
(CC) para 25.
[6]
Tshwane
City v Afriforum and another
[2016] ZACC 19; 2016 (6) SA 279 (CC).
[7]
City
of Cape Town v South African Human Rights Commission
[2021]
ZASCA 182
para 12.
[8]
TWK
Agriculture Holdings (Pty) Ltd v Hoogveld Boerderybeleggings (Pty)
Ltd and others
[2023] ZASCA 63; 2023 (5) SA 163 (SCA).
[9]
Ibid
para 30.
[10]
United
Democratic Movement and another v Lebashe Investment Group (Pty) Ltd
and others
[2022]
ZACC 34
;
2023 (1) SA 353
(CC) paras 45 and 46.
## [11]Polokwane
Municipality v Double Four Properties and another; Broadlands Home
Owners Association NPC v Double Four Properties and
another[2023]
ZASCA 158 para 16.
[11]
Polokwane
Municipality v Double Four Properties and another; Broadlands Home
Owners Association NPC v Double Four Properties and
another
[2023]
ZASCA 158 para 16.
[12]
The
second respondent used the value of its market capitalisation
instead of the value of its total equity when completing the
solvency ratio calculation.
[13]
‘Pervert: To change something so that it is not what
it was or should be…’. Cambridge Online Dictionary:
https://dictionary.cambridge.org/dictionary/english/pervert
.
[14]
See,
for example, indexed pages 1039-1042 and indexed pages 1397-1398.
[15]
Absa
Bank Ltd v Mkhize and Two Similar Cases
[2013]
ZASCA 139
;
2014 (5) SA 16
(SCA) para 64.
[16]
Lebea
v Menye and another
[2022]
ZACC 40
;
2023 (3) BCLR 257
(CC) para 29.
[17]
Economic
Freedom Fighters v Gordhan and others
[2020] ZACC 10
;
2020 (6) SA 325
(CC);
2020 (8) BCLR 916
(CC) para
42.
[18]
Uniform
rule 6(12)
(a)
reads as follows: ‘
In
urgent applications the court or a judge may dispense with the forms
and service provided for in these rules and may dispose
of such
matter at such time and place and in such manner and in accordance
with such procedure (which shall as far as practicable
be in terms
of these rules) as it deems fit.’
[19]
Knox
D’arcy Ltd and others v Jamieson and others
[1996] ZASCA 58
;
1996
(4) SA 348
(A);
[1996] 3 All SA 669
(A) at 361H-I.
[20]
Lubambo
v Presbyterian Church of Africa
1994
(3) SA 241
(SE) at 242H.
## [21]Natal
Joint Municipal Pension Fund v Endumeni Municipality[2012]
ZASCA 13; 2012 (4) SA 593 (SCA); [2012] 2 All SA 262 (SCA).
[21]
Natal
Joint Municipal Pension Fund v Endumeni Municipality
[2012]
ZASCA 13; 2012 (4) SA 593 (SCA); [2012] 2 All SA 262 (SCA).
[22]
Ramakatsa
and others v African National Congress and another
[2021]
ZASCA 31
para 10.
[23]
Ibid.
[24]
Nova
Property Group Holdings Ltd and others v Cobbett and another
[2016]
ZASCA 63
;
2016 (4) SA 317
(SCA) para 9.
sino noindex
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