Case Law[2023] ZAGPJHC 246South Africa
Bothongo Agriculture GP (Pty) Limited v Johannesburg Water Soc Limited (2023-013882) [2023] ZAGPJHC 246 (20 March 2023)
High Court of South Africa (Gauteng Division, Johannesburg)
20 March 2023
Judgment
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# South Africa: South Gauteng High Court, Johannesburg
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## Bothongo Agriculture GP (Pty) Limited v Johannesburg Water Soc Limited (2023-013882) [2023] ZAGPJHC 246 (20 March 2023)
Bothongo Agriculture GP (Pty) Limited v Johannesburg Water Soc Limited (2023-013882) [2023] ZAGPJHC 246 (20 March 2023)
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sino date 20 March 2023
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION, JOHANNESBURG
CASE
NO: 2023-013882
(1)
REPORTABLE: No
(2)
OF INTEREST TO OTHER JUDGES: No
DATE:
20/03/2023
In
the matter between:
BOTHONGO AGRICULTURE
GP (PTY) LIMITED Applicant
and
JOHANNESBURG
WATER SOC LIMITED Respondent
JUDGMENT
This
judgment is deemed to be handed down upon uploading by the Registrar
to the electronic court file.
Gilbert AJ:
1.
The applicant seeks urgent interim relief interdicting the respondent
from
adjudicating bids received in response to and/or awarding and/or
implementing a tender for the lease of Northern Farms. This tender
has been described as the Re-advertised Tender. The relief is sought
pending the final determination of review proceedings already
instituted in respect of an earlier tender of the lease of Northern
Farms.
2.
The respondent published the original version of the Re-advertised
Tender
in December 2020 under tender number JW OPS 038/19.
The applicant timeously submitted a bid in response to that tender,
but its bid, which according to the applicant was the only qualifying
bid, was, the applicant further contends, unlawfully disqualified.
The respondent then cancelled that tender. That tender is described
as the Cancelled Tender.
3.
Of
significance, as will appear below, the respondent’s version is
that the applicant’s bid was disqualified “
after
a rigorous adjudication process”
.
[1]
4.
The applicant contends that the tender was cancelled in circumstances
where
not only should its bid not have been disqualified, but the
tender should have been awarded to it.
5.
In March 2021, the applicant launched judicial review
proceedings against
the respondent under case number
2021/11038 challenging the respondent’s decisions to:
(i) disqualify the applicant’s
bid (which was the only
qualifying bid, accordingly to the applicant) in respect of the
Cancelled Tender, and (ii) subsequently
cancel the Cancelled Tender.
The respondent’s two decisions being challenged in the review
proceedings relating to the Cancelled
Tender are referred to those
proceedings as the “Impugned Decisions” and will be
referred to as such in this judgment.
6.
In the review proceedings, the applicant seeks orders
inter alia
:
6.1.
declaring the Impugned Decisions unconstitutional and unlawful, and
reviewing and setting aside those
decisions;
6.2.
directing the respondent to:
6.2.1.
award the Cancelled Tender to the applicant;
6.2.2.
alternatively, to reconsider the applicant’s bid; or
6.2.3.
further alternatively, readvertise the Cancelled Tender.
7.
The review proceedings are at an advanced stage. All that was
outstanding
in the review proceedings when the founding affidavit was
delivered in this urgent application was for the respondent to file
its
heads of argument and such other documents as were necessary to
enable the applicant to enrol the review proceedings for hearing
on
the opposed roll in terms of the prevailing practice directives. The
respondent did not timeously deliver those documents, with
the result
that its answering affidavit in the review proceedings was struck out
by the court with effect from 17 February 2023.
I return to this
later in the judgment,
8.
Notwithstanding its self-evident dilatoriness in advancing its
opposition
in the review proceedings, the respondent proceeded in
December 2022 to readvertise the Cancelled Tender, as the
Re-advertised
Tender, and to receive bids in response to that
Re-advertised Tender.
9.
The effect of the Re-advertised Tender is that if the respondent
implements
the Re-advertised Tender (adjudicates bids, awards the
tender, and signs an implementation contract), the primary relief
sought
in the review proceedings will, the applicant argues, become
moot and its right to approach another court to vindicate its right
to administrative action in relation to the Impugned Decisions will
be undermined. The applicant contends that this conduct by
the
respondent under the circumstances constitutes constructive contempt
of court, and which founds one of the
prima facie
rights
relied upon by the applicant for interim relief.
10.
The Cancelled Tender and Re-advertised Tender relate to the same
subject matter, which is
the leasing of the Northern Farms. It is not
disputed that the subject matter of the Re-advertised Tender has been
the subject
of the litigation between the parties since March 2021,
in the form of the review proceedings.
11.
Accordingly, the purpose of the urgent application is to interdict
further implementation
of the Re-advertised Tender, until final
determination of the review proceedings in respect of the Cancelled
Tender.
12.
Before considering whether the applicant has satisfied the
requirements for interim interdictory
relief, especially in the
context of granting an interdict that implicates the principle of
separation of powers (an issue pertinently
raised by the respondent),
it is appropriate to set out the chronology in more detail. These
chronological facts are either common
cause or cannot be seriously
disputed.
13.
The applicant seeks to draw various inferences from these facts,
particularly for purposes
of demonstrating that it has a
prima
facie
right founded upon constructive contempt by the respondent.
The respondent argues that these inferences are not justified.
14.
The Cancelled Tender was advertised during December 2020. The
applicant, who was the only
bidder, was disqualified and the
respondent cancelled the tender. As appears above, the applicant has
sought in the review proceedings
that both these Impugned Decisions –
to disqualify the bid and then to cancel the tender - were unlawful.
15.
The applicant launched the review proceedings in March 2021 to review
the Impugned Decisions,
under the Promotion of Access to Justice Act,
2000 (“PAJA”) and/or on the basis of the principle of
legality. The relief
that is sought by the applicant in those review
proceedings has been described above.
16.
It is only in a further alternative in the review proceedings that
the applicant seeks that
the Cancelled Tender be readvertised. In the
first instance the applicant seeks that the Cancelled Tender be
awarded to it, alternatively
that the respondent be ordered to
reconsider the applicant’s bid in respect of that tender. The
argument by the respondent
that as the applicant wanted a
readvertisement of the Cancelled Tender, the applicant cannot now
complain that the respondent went
ahead and readvertised the tender
in December 2022 is misplaced.
17.
At the time that the review proceedings were launched, no steps had
been taken by the respondent
to readvertise the Cancelled Tender, or
to otherwise act following upon its cancellation of the tender. In
other words, the respondent
appeared content to await the outcome of
the review proceedings.
18.
On 11 March 2021, the respondent delivered its notice of intention to
oppose the review
proceedings.
19.
On 3 May 2021, the respondent delivered the record of the Impugned
Decisions.
20.
Between May 2021 and September 2021, the parties agreed to suspend
the
dies
in the review proceedings to facilitate negotiations
with a view to resolving the matter out of court.
21.
On 1 October 2021, the respondent delivered its answering affidavit.
22.
On 15 October 2021, the applicant delivered its replying affidavit.
23.
On 1 February 2022, the applicant filed its heads of argument. But
the respondent did not.
24.
It is clear from this chronology of the litigation in the review
proceedings that it was
the failure of the respondent to timeously
deliver its heads of argument, chronology and list of authorities
that precluded the
applicant from enrolling those proceedings for
hearing on the opposed roll.
25.
To advance the review proceedings, on 12 October 2022, the applicant
obtained a court order
compelling the respondent to file its heads of
argument, heads of argument, chronology and list of authorities
within three days.
26.
On 24 October 2022, the respondent’s legal representatives
acknowledged receipt of
the compelling order. The respondent still
did not comply and had still not complied by the time this urgent
application was launched
on 14 March 2022.
27.
In November 2022, the applicant launched an interlocutory application
in the review proceedings
seeking that the respondent’s defence
be struck out because of its failure to comply with the compelling
order.
28.
That interlocutory application, which was enrolled for hearing on 14
February 2023, had
not yet been heard by the time the applicant
deposed to a founding affidavit in these urgent proceedings.
Subsequently, in its
replying affidavit, the applicant points out
that on 14 February 2023 the interlocutory court, after hearing
argument from the
parties’ counsel,
inter alia
granted
an order compelling the respondent to deliver its heads of argument,
chronology and list of authorities by close of business
on Friday, 17
February 2023, failing which the respondent’s defence was
struck out.
29.
Although the respondent did deliver its heads of argument on
17 February 2023,
it did not deliver a chronology and list
of authorities. The applicant contends that in terms of the order
granted on 14 February
2023 the respondent’s defence is struck
out and that effectively the applicant can now approach the court for
default judgment
in the review proceedings. The respondent during
argument before me did not advance any argument to the contrary.
30.
From these common cause facts the inference drawn by the applicant
that the respondent has
delayed, deliberately so, the hearing of the
review proceedings does have substance. That the respondent’s
defence has been
struck out also reinforces the applicant’s
second asserted
prima facie
right to found interim
interdictory relief, namely on the grounds of review described in the
review proceedings.
31.
Throughout the conduct of the review proceedings, until its decision
to re-advertise the
Cancelled Tender in December 2022, on the
evidence before me, the respondent was content to await the outcome
of the review proceedings
that had been launched in March 2021.
Although there was no formal agreement to that effect, or a court
order interdicting the
respondent from acting upon its decision to
cancel the tender, such as re-advertising the tender, that this was
the respondent’s
position can be readily and justifiably
inferred from its conduct.
32.
It is now necessary to set out the chronology in relation to the
Re advertised Tender
and the relevance thereof in the context of
the chronology relating to the litigation in the review proceedings.
33.
On 9 February 2023 the respondent in a supplementary affidavit
deposed to in the review
proceedings for the first time informed the
applicant that it had readvertised the Cancelled Tender in December
2022. The respondent
motivated this disclosure in the review
proceedings on the basis that it was a central fact that needed to be
placed before the
court in the review proceedings and that this
justified the filing of the supplementary affidavit. The relevance of
the respondent’s
re-advertisement of the Cancelled Tender
cannot be doubted.
34.
What is remarkable, in the context of the on-going review proceedings
in relation to the
Cancelled Tender, is that it was only on 9
February 2023 that the respondent disclosed to the applicant that it
had already readvertised
the tender in December 2022.
35.
The respondent explains that it had already on 5 December 2022
readvertised this tender
in various media publications and the
Government Gazette and that in response four bidders submitted bids.
The respondent explains
that the closing date for the readvertised
tender was 3 February 2023.
36.
What is immediately evident is that the respondent not only did not
inform the applicant
that the Cancelled Tender was going to be
readvertised, or had been readvertised, but the respondent waited
until after the closing
date for bids on 3 February 2023 in respect
of that readvertised tender before informing the applicant, and the
court, on 9 February
2023 that the Cancelled Tender had since been
readvertised.
37.
The inference that the applicant seeks be drawn from these facts is
that the respondent
deliberately withheld from the applicant’s
knowledge that the bid had been readvertised so that by the time the
applicant
discovered the readvertisement of the tender, it would no
longer be able to participate in the Readvertised Tender as the
tender
would have closed.
38.
The respondent does not squarely address this issue in its answering
affidavit, but instead
contents itself with generalised denials. The
facts from which the inference is drawn are common cause or cannot be
seriously disputed,
and called for an explanation from the
respondent.
39.
The respondent’s counsel submitted during argument that the
timing of the delivery
of the supplementary affidavit in the review
proceedings on 9 February 2023 was precipitated by the applicant
having enrolled the
interlocutory application for hearing on 14
February 2023 seeking that the respondent’s defence in the
review proceedings
be struck out. This explanation does not feature
in the papers and in any event lacks substantive cohesion. The
appropriate reaction
from the respondent to the applicant’s
enrolment of the interlocutory application in the review proceedings
to strike out
the respondent’s opposition would have been the
filing of the heads of argument and the other outstanding documents,
not
the filing of the supplementary affidavit.
40.
In my view there is considerable substance to the applicant’s
inference that it seeks
to draw that the timing of the disclosure of
the re-advertised tender was deliberate. This is of relevance to the
applicant’s
assertion that the respondent had acted in
constructive contempt by seeking to render the applicant’s
relief that it seeks
in the review proceedings nugatory, or largely
nugatory. If there was sufficient progress in relation to the
finalisation of the
Re-Advertised Tender (such as the tender having
been awarded to a successful bidder), that may severely curtail the
relief available
to be granted by the review court.
41.
The applicant does not seek that this urgent court actually find that
there is constructive
contempt but rather that there is sufficient
evidence of constructive contempt to found a
prima facie
right
to sustain interim interdictory relief.
42.
To now turn to the requirements for interim interdictory relief,
particularly in matters
such as this.
43.
I have taken considerable guidance from the Constitutional Court
decision of
National Treasury and Others v Opposition to Urban
Tolling Alliance and Others
2012 (6) SA 223
(CC)
[“Outa”]
,
a decision referred to by both parties and particularly relied upon
by the respondent. The majority decision per Moseneke DCJ
held:
“
[45]
It seems to me that it is unnecessary to fashion a new test for the
grant of an interim interdict. The Setlogelo test
[2]
,
as adapted by case law, continues to be a handy and ready guide to
the bench and practitioners alike in the grant of interdicts
in busy
magistrates' courts and high courts. However, now the test must be
applied cognisant of the normative scheme and democratic
principles
that underpin our Constitution. This means that when a court
considers whether to grant an interim interdict it
must do so in a
way that promotes the objects, spirit and purport of the
Constitution.
[46]
Two ready examples come to mind. If the right asserted in a claim for
an interim interdict is sourced from the Constitution
it would be
redundant to enquire whether that right exists. Similarly, 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.
[47]
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.”
44.
The applicant relies upon two
prima facie
rights to found
interim interdictory relief.
45.
The first
asserted
prima
facie
right,
[3]
which is relevant in the context of constructive contempt, is that
the applicant, following upon its constitutional right of access
to
court enshrined in section 34 of the Constitution, is entitled to its
dispute that forms the subject matter of the review proceedings
being
heard by a court. That right entails that when the court hears the
dispute the relief that the applicant seeks can still
be granted by
the court as that relief must not have been rendered nugatory in the
interim though the conduct of the respondent.
And so should the
respondent take steps in the interim to render that relief nugatory,
that would amount to constructive contempt,
and which in and of
itself would found a
prima
facie
right to interim interdictory relief.
46.
In the present instance, the applicant asserts that when the review
court in the main review
proceedings hears the review application,
its right of access to court entails that the relief that it seeks in
its review proceedings
can still be granted, particularly that the
Cancelled Tender can be awarded to the applicant, alternatively that
the applicant’s
bid can be reconsidered. If by then the
Re-advertised Tender has already been finalised through the
adjudication of bids, the award
of the tender and the conclusion of a
contract with the successful bidder, then the relief that the
applicant seeks, the applicant
argues, would largely have been
rendered nugatory as the review court’s ability to grant the
relief sought by the applicant
will have been severely, if not
irreparably, compromised. And so, the applicant argues, the
respondent in seeking to re-advertise
the Cancelled Tender and
implement that tender, which may result in the relief in the review
proceedings being rendered nugatory,
has acted in constructive
contempt of the anticipated order to be granted by the review court.
47.
I raised
with counsel during argument whether the merits of the dispute that a
party sought to be ventilated in the court (in this
instance the
applicant in respect of its review application) played any role in
assessing whether there can be constructive contempt
of an order that
has not yet been made. The applicant’s counsel’s
submission was that the merits do not play a role
as the applicant is
entitled to have its dispute be heard, whatever the merits, and so
that the respondent cannot take steps to
render nugatory the relief
that is sought in those proceeding. I posited to counsel what the
position may be if an applicant’s
claim palpably had no merit
or if a respondent had an unanswerable defence. Common sense would
seem to indicate that it should
play a role, as can there be
constructive contempt of an order that is unlikely to be granted? On
the other hand, a court, particularly
an urgent court, should not be
called upon to delve too deeply into the merits of the review
application as the decision of the
review court should not be
anticipated.
[4]
48.
I need not resolve this issue because, after reflection I have
decided, to determine the
applicant’s right to interim
interdictory relief based on the more conventional
prima facie
right arising from its grounds of review in the review proceedings,
rather than deciding whether a right to interim interdictory
relief
arises in the context of constructive contempt.
49.
I do so
because it is not clear to me that should I grant interim
interdictory relief premised upon the applicant having established
a
prima
facie
right that its dispute be heard without the respondent having taken
steps in the interim to render the relief the applicant seeks
nugatory i.e. in the context of constructive contempt, that the
interdictory relief would be interim rather than final in effect.
The
review court will decide whether the applicant is entitled to the
relief that the applicant seeks in the review proceedings
and will
not necessarily decide whether the respondent has acted in
constructive contempt. I refer to the distinction between interim
and
final relief as expounded in
Andalusite
Resources (Pty) Ltd v Investec Bank Ltd and Another
2020
(1) SA 140 (GJ).
[5]
50.
It also appears that whether the respondent may have acted in
constructive contempt is more
nuanced than may appear at first blush.
While it may be that the respondent’s conduct in re-advertising
the Cancelled Tender
could, ordinarily, be perceived as being in
constructive contempt for the reasons described above, the
respondent’s argument
is not without merit that an organ of
state it is entitled, and obliged, to discharge its constitutional
duties by taking such
steps as are necessary consequent upon its
decision notwithstanding that its decision may be under review.
51.
For
example, in
Outa
,
SANRAL was intent on proceeding with the implementation of its
controversial ‘e-tolling’ system consequent upon various
decisions that had been made although those decisions were the
subject of pending review proceedings. Outa sought interim
interdictory
relief, which was granted by the court
a
quo
but
overturned by the Constitutional Court. There was no suggestion, at
least as appears from the judgment, that SANRAL was acting
in
constructive contempt in pushing ahead with the e-tolling system
notwithstanding the pending review proceedings. Of course there
are
distinguishing features but the point is that an organ of state
pressing ahead in implementing its decision whilst there are
pending
review proceedings must not too quickly be branded as constructive
contempt. Especially so given the imperative that the
court when
considering whether to grant interim interdictory relief must be
alive to the principle of separation of powers.
[6]
52.
And it may also be doubtful whether seeking to found interim
interdictory relief on a form
of constructive contempt achieves
something meaningful, in the context of interim interdicts
pendente
lite
. If there is a real risk that the relief sought in the main
proceedings would be rendered nugatory by the conduct of the
respondent
(i.e the conduct that forms the basis for constructive
contempt), the requirement of a well-grounded apprehension of
irreparable
harm if the interim relief is not granted would in any
event be satisfied. To put it another way, without the risk of the
respondent
conducting itself in a manner that may amount to
constructive contempt of the order still to be granted, the usual
requirements
for interim relief
pendente lite
would not be
satisfied. If peered at closely enough, founding interim interdictory
relief on constructive contempt may prove to
be a will-o’-the-wisp,
having been subsumed in the usual requirements for interim interdicts
pendente lite
.
53.
And so I
rather proceed on the steadier grounds of whether the applicant has
established a
prima
facie
right
based upon its prospects of success on its grounds of review in the
review proceedings.
[7]
This is
particularly so as these remain urgent proceedings where the parties,
and the court, would have not had the opportunity
they ordinarily
would have had to explore these issues. To the extent that the
respondent has conducted itself in manner that attracts
an inference
that it has deliberately timed the re-advertising of the Cancelled
Tender and the disclosure thereof, that can be
assessed in the
context of the remaining requirements for interim interdictory
relief.
54.
Turning
again to the instructive Constitutional Court decision of
Outa
:
[8]
“
[49]
Second, there is a conceptual difficulty with the high court's
holding that the applicants have shown 'a prima facie .
. .
right to have the decision reviewed and set aside as formulated in
prayers 1 and 2'. The right to approach a court to
review and
set aside a decision, in the past, and even more so now, resides in
everyone. The Constitution makes it plain that '(e)veryone
has the
right to administrative action that is lawful, reasonable and
procedurally fair' and in turn PAJA regulates the review
of
administrative action.
[50]
Under 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.”
55.
It is
therefore not sufficient for the applicant to simply show that it has
a
prima
facie
right to review the Impugned Decisions.
[9]
It must go further and show that the
prima
facie
right is threatened by impending irreparable harm. But it does remain
necessary for the applicant to show that it has prospects
of success
on its grounds in the review proceedings in order to establish that
right.
[10]
[11]
56.
The
applicant in its founding affidavit summarises its grounds of review
of the Impugned Decisions.
[12]
While averments made in the founding affidavit in support of these
grounds of review are sparse, the respondent does not squarely
take
issue with this in its answering affidavit and appears content, as
does the applicant, for the battle on the merits of the
review to be
waged in the review proceedings. What also weighs heavily in favour
of the applicant is that the respondent’s
defence in the review
proceedings has been struck out.
57.
Such
argument as was made in these urgent proceedings by the respondent
why the applicant would fail in the review proceedings is
that the
respondent’s decision to cancel the tender does not amount to
administrative action, and so cannot be set aside
on review.
[13]
The respondent relies upon
Tshwane
City and Others v Nambiti Technologies
(Pty) Ltd
2016 (2) SA 494
(SCA) where Wallis JA found that the
cancellation of a tender by an organ of state prior to its
adjudication did not constitute
administrative action,
[14]
and that to effectively compel a state organ to consider and award a
tender that it had decided not to proceed with, may infringe
on the
doctrine of separation of powers and should only be done in extreme
circumstances.
[15]
58.
Without
anticipating the decision of the review court,
Nambiti
may be distinguishable as in that matter the tender was cancelled
before an adjudication of the bids that had been submitted.
[16]
In contrast, in the present instance, the respondent states that
cancellation of the tender took place “
[f]ollowing
a rigorous adjudication process”
,
and with no bidder qualifying.
[17]
Also, in
Nambiti,
the tender was cancelled because the state organ no longer wanted the
services that had gone out on tender
[18]
and so SCA found that it would only be in extreme circumstances that
a state organ would be ordered to award a tender to procure
services
it no longer wanted.
[19]
In
the present instance the tender was cancelled because, accordingly to
the respondent, there were no responsive bids,
[20]
not because it no longer wished to let the farms.
59.
To the
extent that the respondent argued that the applicant cannot have a
prima
facie
right as the respondent is not acting unlawfully in proceeding with
the Re-advertised Tender as there is not yet (and may never
be) an
order finding that the Impugned Decisions are to be reviewed and set
aside, this argument was rejected in
Transnet
Bpk h/a Coach Express en ‘n Ander v Voorsitter, Nasionale
Vervoerkommissie, en Andere
1995 (3) SA 844 (T).
[21]
60.
Turning to the remaining requirements for interim interdictory
relief.
61.
The irreparable harm that the applicant contends for if the interim
relief if not granted
is that if the Re-advertised Tender is awarded
and then implemented, it is unlikely, if possible at all, that the
review court
when it hears the review application will be in a
position to grant the relief sought by the applicant that it be
awarded the Cancelled
Tender, alternatively that the respondent be
required to reconsider the applicant’s bid in respect of that
tender. This is
because the tender would have been awarded to another
bidder, pursuant to the Re-advertised Tender.
62.
This is notwithstanding the wide powers afforded to the court under
section 8
of PAJA to grant any order that is just and
equitable or under section 172 of the Constitution to craft an
appropriate remedy that
is just and equitable.
63.
The respondent does not contest that the relief that the applicant
seeks in the review proceedings
would most likely no longer be
available as viable remedies should interim relief not be granted and
the Re-advertised Tender is
then awarded and implemented.
64.
I therefore find that there is a well-grounded apprehension of
irreparable harm if the interim
relief is not granted.
65.
The respondent’s focus is rather on asserting that there is a
satisfactory alternative
remedy to an interdict, namely damages.
66.
During argument, submissions were made by counsel as to whether
damages or compensation
would be available as an alternative
remedy under PAJA should it be found that the Impugned Decisions
must be reviewed and
set aside, and the relief sought by the
applicant in its review proceedings no longer available. The parties
were in agreement
that section 8(1)(c)(ii)(bb) of PAJA expressly
provides that upon setting aside the administrative action, the court
may in
exceptional circumstances
inter alia
direct the
respondent to pay compensation.
67.
The respondent argued that this constituted an alternative
satisfactory remedy in the circumstances
and therefore the applicant
had not made out a case for an interim interdict.
68.
The
applicant, on the other hand, submitted, in light of the recent
Constitutional Court decision of
Esorfranki
Pipelines (Pty) Limited v Mopani District Municipality
,
[22]
that in the absence of the respondent having engaged in deliberate
misconduct or dishonesty (which is not the applicant’s
case in
the review proceedings), damages or compensation could not be
awarded, and so damages or compensation was not an available
remedy.
69.
I expressed
some hesitancy during argument as it appeared to me that this may
result in certain instances where a successful applicant
on review
could end up being denied any effective relief, especially if the
horse had bolted in relation to every other form or
relief.
[23]
Happily I need not resolve this issue because even if the applicant
is able to claim damages or compensation in due course, in
my view
that does not constitute a satisfactory alternative remedy in these
circumstances.
70.
The
applicant is entitled, as least where it has established a
prima
facie
case and the remaining requirements for an interim interdict, to
require of the review court in due course to determine whether
it
should be granted the relief that it seeks, namely that the Cancelled
Tender be awarded to it or alternatively that its bid
be reconsidered
by the respondent and that the applicant cannot, in the present
prevailing circumstances, be compelled to content
itself with a claim
for damages or compensation.
[24]
This is particularly so where the extent of that claim will probably
prove nebulous in its proof and where there is the legal debate
whether it would in any event be available, in light of
Esorfranki
.
At the very least, the applicant would have to show exceptional
circumstances to claim compensatory relief,
[25]
and relief that requires such as threshold cannot be considered as a
satisfactory alternate remedy.
71.
In
determining where the balance of convenience lies, and in the context
of the principle of separation of powers, as stated
in
Outa
,
[26]
the enquiry must carefully probe whether and to what extent the
restraining order will probably intrude into the exclusive terrain
of
the another branch of government. Further, 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 and that
it is
neither prudent nor necessary to define 'clearest of cases'.
[27]
72.
In the present instance, the statutory power that the respondent, or
more accurately the
municipality who is the owner of the farms and
has authorised the respondent to lease those farms, would be
restrained from exercising
is the letting of those farms. As the
initial tender was cancelled, and as the cancellation has not been
declared unlawful, the
respondent’s argument is that it is
entitled to act consequent upon that cancellation and relet the
farms.
73.
Accepting then that the grant of an interim interdict will to this
extent infringe upon
the municipality’s exercise of its
statutory power, and so implicate the principle of separation of
powers, I am of the view,
in considering the balance of convenience
and the other requirements for interim interdictory relief, that this
is a case where
an interim interdict should nevertheless be granted:
73.1.
The
respondent does not describe any specific harm that the respondent,
or municipality, will suffer if the interim interdict is
granted and
the farms cannot be let in the interim. The respondent contents
itself in its answering affidavit to vaguely referring
to its
obligation to serve the millions of people within its jurisdiction
through the income that would be realised from the letting
of the
farms.
[28]
But, for example,
no details are provided of the income that the letting of the farms
will generate for the municipality, particularly
for the period that
the letting of the farms will be sterilised while the interim
interdict is place and the determination of the
review proceedings
awaited.
73.2.
This can be
contrasted to the detailed harm that was foreseen to the respondents
in
Outa
if the interim interdict was granted in that matter preventing SANRAL
from levying and collecting toll moneys from motorists while
the
outcome of the review proceedings was awaited, which included a
downgrading of SANRAL’s business rating and consequent
impact
on its ability to execute other projects, the risk of the executive
government being called upon to honour a sovereign guarantee
for the
debt of SANRAL of R20 billion and the consequent impact upon the
economy of the country as a whole, and the resultant need
for the
government to appropriate money from the national revenue fund
budgeted for elsewhere to fund SANRAL’s debt exposure
while the
interim interdict was in place and its consequent prejudice to the
taxpayers.
[29]
73.3.
The reasonably apprehended irreparable harm that the applicant will
suffer if the Re-advertised Tender
goes ahead has already been
described above.
73.4.
The
duration of the interim interdict would not be lengthy. The main
review proceedings are ripe for hearing. But for the respondent’s
dilatoriness in its opposition to the main review proceedings, the
main review proceedings would probably have been heard by now.
The
respondent’s defence has been struck out, opening the way for
the applicant to proceed on a default basis. Whether or
not the
respondent seeks to reinstate its defence, the applicant should now
be able to enrol its application, whether on the opposed
or unopposed
roll as may be appropriate, and so have the review application heard
within the next two to three months. This can
be contrasted to an
interim interdict restraining the exercise of statutory power “
well
ahead”
of the final adjudication of the review proceedings, as was the case
in
Outa
.
[30]
73.5.
In any event, a complaint by the respondent about the delay and
resultant (but unspecified) prejudice
caused by the interim interdict
while the determination of the review proceedings is awaited is
cynical where the respondent has
caused the delay in the
determination of the review proceedings.
73.6.
The respondent makes out no case in its answering affidavit why there
was pressing need in December
2022 to lease the farms in
circumstances where the respondent had been content until then that
the review proceedings run their
course. The tender was cancelled by
the respondent as long ago as 2020, and no steps were taken until
December 2022 to readvertise
the tender. The respondent’s
assertion that the interim interdict will prevent the municipality
from generating income should
the farms be let does not resonant
where it was content to forego that income for some two years
previously, since the cancellation
of the tender in 2020.
73.7.
Of relevance is the applicant’s argument that the readvertising
of the tender was deliberate
and specifically to preclude the review
court from being able to grant certain relief in due course. The
respondent’s re-advertising
of the cancelled tender appears,
upon a consideration of the factual chronology, to be motivated more
as a strategic move in opposition
to the review proceedings than as a
pressing need to let the farms to generate revenue for the
municipality.
73.8.
The
Re-advertised tender has not reached an advanced stage, and so should
the interim interdict be granted, the effect thereof on
the bidders
for that tender is limited. The respondent is not forthcoming in its
answering affidavit as to the stage that has been
reached in the
re-advertised tender, saying no more than there are four short-listed
bidders that had complied with the bidding
requirements and that the
adjudication process is underway.
[31]
During argument, upon enquiry by the court, the respondent through
its counsel, after taking instructions, for the first time disclosed
that the respondent would not complete the adjudication process and
make an award by 19 June 2022. As there has been no adjudication,
the
prejudice that the shortlisted bidders will suffer if the interim
interdict is granted and the adjudication cannot be completed
is
outweighed by the prejudice that the applicant will suffer if the
re-advertised tender goes ahead and, after adjudication, is
awarded
to the successful bidder. It might even be that the shortlisted
bidders will suffer no legally cognisable prejudice if
the interim
relief is granted as there has not been an adjudication of the bids,
although I do not make any finding on this.
[32]
73.9.
As there would not have been an adjudication and an award of the
Re-advertised Tender before 19 June
2022 even if the interim
interdict was not granted, the granting of that interdict where the
review proceedings are capable of
being determined by that date also
weighs in favour of granting the interdict.
74.
To the extent that the respondent argued that it is not open to the
court to grant an interdict
that restrained the exercise of statutory
power, this is too widely stated. As appears from
Outa
, the
court does have the power to grant such an interim interdict,
provided that the usual requirements for such relief are applied
cognisant of the caution and imperatives expressed in
Outa
.
75.
In the circumstances, I find that the applicant has satisfied the
requirements for an interim
interdict pending the outcome of the
review proceedings.
76.
The respondent also raises an issue of non-joinder, contending that
the applicant had not
joined the four shortlisted bidders who had bid
in response to the Re-advertised Tender and whose bids were presently
being considered
by the respondent.
77.
Although it
not beyond doubt that these bidders would suffer legally cognisable
prejudice if an interim interdict is granted as
their bids have not
yet been adjudicated,
[33]
I
proceed on the assumption that they nevertheless may have a
sufficient interest that they should be parties to these proceedings.
78.
The applicant accordingly sought of this court to
mero motu
join these parties to these proceedings. No real opposition was put
up by the respondent to this and in the circumstances I order
that
these bidders be joined to these proceedings.
79.
But this issue does not end there because what is to be made of these
bidders’ participation
in these proceedings when they have only
been joined now, and did not advance any argument before me? The
applicant has detailed
in its replying affidavit what steps have been
taken since the respondent belatedly, only after the launch of these
urgent proceedings,
made known to the applicant sufficient details of
these bidders to enable them to be identified and approached by the
applicant’s
attorneys. The applicant argued that should these
bidders have wished to participate in the proceedings, they would
have already
done so, especially given the lengths to which the
applicant’s attorneys have gone to inform these bidders as to
what relief
was being sought in the urgent court. The applicant
submitted that these interested parties once joined should be left to
ascertain
for themselves by reference to
inter alia
the
Uniform Rules what remedies they may have in relation to such relief
as may be granted by this court in their absence as may
adversely
affect them. Reference was made, to Rule 6(12)(c) that provides for a
reconsideration of an urgent order by a person
in whose absence the
order was made as well as to Uniform Rule 42 regulating the variation
and rescission of orders.
80.
As these urgent proceedings have been fully argued before me as
between the applicant and
the respondent and as the applicant cannot
be faulted for not joining the bidders earlier, it would not be in
the interests of
justice that the application be postponed and
another court burdened with hearing the application once the joined
parties have
been informed of their joinder. Rather I intend ordering
that these joined parties are entitled to take such steps as they may
deem appropriate to seek a re-hearing in relation to the interim
relief insofar as they may be affected thereby. It will be for
those
joined parties to ascertain what procedure should be adopted to
advance their position.
81.
The applicant has also asked that I join these bidders to the review
proceedings given that
they may have an interest in those
proceedings. No argument to the contrary was made by the respondent.
I will accede to this request
as it will advance the determination of
those review proceedings, and so assist in curtailing the potential
impact that the interim
interdict may have, as sooner those review
proceedings determined, the better.
82.
Turning to the issue of costs.
83.
The respondent argues that the matter was not urgent as the applicant
should have been alive
to the re-advertisement of the tender as long
ago as 5 December 2022, when the tender was advertised in the media,
and so any urgency
is self-created as the applicant should have
approached the urgent court long before it did in February 2023.
84.
The manner in which the respondent, as an organ of state, has gone
about litigating and
conducting itself in the context of the pending
review proceedings is disquieting. The respondent has not adduced
evidence to gainsay
the evidence relied upon by the applicant in
drawing the inference that the respondent deliberately readvertised
the tender and
did not inform the applicant. The respondent’s
response to this was that there was no obligation upon it to grant
the applicant
any “
special favours
” by informing
the applicant specifically that there was a readvertisement of the
tender as that readvertisement of the tender
took place in the media
as is required by law. The respondent’s submission is that
should it have given such notice to the
applicant, it would have
resulted in preferential treatment to the applicant. I find little
substance in this submission, as I
do not see how giving notice that
the Cancelled Tender would be readvertised to the person most
directly affected by that readvertisement
of the tender can
constitute preferential treatment.
85.
I put to the respondent whether the proposition that the respondent
as an organ of state
was not an ordinary litigant and should
therefore take particular care that it litigated with transparency.
The respondent had
no difficulty with the proposition but rather
argued that on the facts of this matter the respondent had acted
transparently.
86.
As appears above, I have considerable doubt that the respondent
conducted itself transparently
in relation to the litigation, and in
going about readvertising the Cancelled Tender without giving the
applicant any notice thereof,
and then only doing so after that
readvertised tender had already closed.
87.
My sense of disquiet is reinforced by the manner in which the
respondent has gone about
delaying the review proceedings, to the
extent that now shortly before the hearing of this urgent application
the respondent’s
defence in those review proceedings has been
struck out.
88.
Also relevant is the respondent’s reticence in these urgent
proceedings to have disclosed
that the adjudication process would not
be finalised and an award made before 19 June 2023. Had that
disclosure been made by the
respondent before the applicant was
compelled to launch urgent proceedings, these urgent proceedings may
have been averted as the
review proceedings could have been decided
by then. At the very least, these urgent proceedings would not have
to be proceed on
the basis of severely truncated periods for the
exchange of affidavits.
89.
The disclosure was also only made during the course of the
respondent’s argument before
me. Had this disclosure been made
earlier, it may have been appropriate for this court to first have
joined the four shortlisted
bidders, provided for a timetable for the
exchange of affidavits and have postponed the urgent application to
facilitate their
participation. But by the time the disclosure was
made, the urgent application had largely already been argued before
me.
90.
It also follows that the applicant cannot be faulted for bringing
this application urgently
as it was kept in the dark by the
respondent as to what progress was being made in relation to
advancing the Re-advertised tender.
The applicant did not know until
well into the hearing before me that an award would not be made
before 19 June 2023.
91.
I therefore find that it would be appropriate that the respondent pay
the costs of these
urgent proceedings for an interim interdict rather
than, for example, the costs being reserved for determination by the
court in
the review proceedings.
92.
Finally, there will have been a delay between when this matter was
argued before me in urgent
court on 22 February 2023 and I reserved
judgment, and when this judgment is delivered. Once the respondent
disclosed that the
adjudication would not be finalised and an award
made before 19 June 2023, the immediate urgency of the application
dissipated.
As appears above, it is questionable whether this matter
required the attention of the urgent court at all if the award is not
be made before 19 June 2023 but the applicant cannot be faulted for
that.
93.
The following order is granted:
93.1.
The following parties,:
93.1.1.
Kagiso Molebaloa Investments (Pty) Limited as the second respondent;
93.1.2.
Majuba Technologies (Pty) Limited as the third respondent;
93.1.3.
Blue Dot G Services as the fourth respondent; and
93.1.4.
Thuso Skills Development and Training Centre as the fifth respondent,
are joined
to both these proceedings and the review proceedings
application under case number 11038/2021, and the applicant is
granted leave
to serve all process as may be required via email at
the email addresses of such joined as referred to in the applicant’s
replying affidavit in these proceedings.
93.2.
The first respondent Johannesburg Water SOC Ltd is interdicted,
pending the final determination of
the review proceedings between the
applicant and the first respondent under case number 11038/2021, from
appointing any third party
(including the joined parties) and/or
negotiating or concluding any contract with such third party
(including the joined parties),
and/or implementing or further
implementing as the case may be, any contracts with such third
parties (including the joined parties)
in relation to or in
connection with Tender No. JWOPS038/19R (Lease for Northern Farms).
93.3.
The parties joined as the second to fifth respondents are granted
leave to approach the court for
such relief as may be appropriate,
including a reconsideration of this order insofar as it may affect
them prejudicially.
93.4.
The costs of this application, which costs shall include the costs of
two counsel, are to be paid
by the first respondent.
Gilbert AJ
Date of
hearing:
22 February 2023
Date of judgment:
20
March 2023
Counsel for the
Applicant: G
Girdwood SC
M Gwala
Instructed
by: Van
Eeden Rabie Inc.
Counsel
for the Respondent: Ms
C Makhajane
Instructed
by: SSM
Attorneys
[1]
Answering
affidavit, para 51 at Caselines 01-118.
[2]
Setlogelo
v Setlogelo
1914
AD 221
[3]
See
para 50 of the founding affidavit, as developed in argument.
[4]
See
Outa
,
para 31.
[5]
Particularly
para 20 to 24.
[6]
See
Outa
above, para 47.
[7]
See
para 44 to 49 read with para 40 and 41 of the founding affidavit.
[8]
Above,
para 49 and 50.
[9]
As
an aside, this does give rise to misgivings as to the applicant’s
submission that its right to have its dispute determined
in court
regardless of its merits, in the context of its right of access to
court and constructive dismissal, in and of itself
can sustain a
prima
facie
right worthy of protection by way of an interim interdict.
[10]
In
Ladychin
Investments (Pty) Ltd v South African National Roads Agency Ltd and
Others
2001 (3) SA 344
(N) the court found that the court has to evaluate
the prospects of success in the review application. See also
Capstone
566 (Pty) Ltd and Another v Commissioner, South African Revenue
Service and Another
2011 (6) SA 65
(WCC), para 53. Binns-Ward AJ (as he then was) in
Searle
v Mossel Bay Municipality and Others
[2009] ZAWCHC 9
(12 February 2009) described the test as follows:
“
That
means the prospects of success in the contemplated review
proceedings - as far as it is possible at this stage to assess
them
- represent the measure of the strength or otherwise of the alleged
right that the applicant must establish prima facie in
order to obtain interim relief.”
[11]
In
Outa
the Constitutional Court found that it need not consider whether the
applicant had established a
prima
facie
right as it would find that the applicant failed on the other
requirements for interim interdictory relief: para 52.
[12]
Paragraphs
40 to 41 of the founding affidavit.
[13]
See
para 58 of the answering affidavit; para 10 and 11 of respondent’s
further submissions.
[14]
Para
24 and 31 to 34, as summarised in the headnote.
[15]
Para
43.
[16]
Para
24, 32 and 33.
[17]
Answering
affidavit, para 51.
[18]
Para
26, 27 and 31.
[19]
Para
43.
[20]
Answering
affidavit, para 52.
[21]
At
847J – 848A. Although this argument found favour in
Coalcor
(Cape) (Pty) Ltd and Others v Boiler Efficiency Services CC and
Others
1990 (4) SA 349
(C), it was subsequently rejected in various
cases, such as
Ladychin
above
at 357D, which cases followed
Transnet
.
[22]
2022 JDR 3614 (CC), at
paras
55 and 56.
[23]
Theron J says in paragraph 56 that
“
But
where the state's misconduct is deliberate and dishonest and where
substitution or remittal are not viable forms of relief,
or
where this relief will not suitably remedy the loss sustained by a
party
,
circumstances may exceptionally require compensatory relief in order
to ensure a just and equitable result”
(my
emphasis). I do not read this as necessarily excluding compensatory
relief where there is no misconduct that is deliberate
and
dishonest, but rather as compensatory relief being available where
substitution or remittal are not viable forms of relief,
if the
circumstances are exceptional.
[24]
Analogously,
see
Candid
Electronics (Pty) Limited v Merchandise Buying Syndicate (Pty)
Limited
1992 (2) SA 459
(C) where the court, with reference to
Haynes
v King William’s Town Municipality
1951 (2) SA 371
(A) at 378 E – F, reiterated that a plaintiff
has a right of election whether to hold the counter-party into his
contract
and claim performance, or to claim damages for breach.
The defendant does not have an election to insist that the plaintiff
take damages instead of having an order for specific performance.
This was affirmed by the Supreme Court of Appeal in
V&A
Waterfront Properties (Pty) Limited v Helicopter and Marine Services
(Pty) Limited
2006 (1) SA 252
(SCA), para 23.
[25]
Esorfranki
above,
para 56. See also section 8(1)(c)(ii) of PAJA, which requires
“
exceptional
cases”
for compensatory relief.
[26]
Para
47.
[27]
Outa
,
para 47.
[28]
Answering
affidavit, para 52 and 74.
[29]
Para
27 and 57 to 60.
[30]
Outa
,
para 47.
[31]
Para
38 and 47 of the answering affidavit.
[32]
Nambiti
,
para 32 and 33, and the discussion above.
[33]
Nambiti
,
para 32 and 33, and the discussion above.
sino noindex
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