The Free State Police, Roads, and Transport (PRT) is again making headlines after the Free State High Court Judge Johannes Daffue kicked MEC Bulwane’s teeth inside after the department relied on section 14 and its subsections which do not exist to disqualify Roadmac Surfacing (Pty) LTD from a tender.
This is after Roadmac (Pty) LTD asked the court to interdict MEC Bulwane and Tau Pele Construction and judgment was handed on 2 June 2022.
Daffue said, “Clearly, the first response did not have the faintest idea which regulation he wanted to rely on to substantiate the alleged non-compliance of the prequalification of a 30% subcontracting requirement.
If I accept for the moment that the first respondent intended to refer to regulation 14 and not section 14, regulation 14 does not deal with prequalifying criteria.”
This followed an application brought by Roadmac Surfacing (Pty) LTD against William Bulwane, MEC PRT as the first respondent, and Tau Pele Construction as the second respondent.
BACKGROUND
Upon invitation by the Department of Police, Roads and Transport, Free State Province, several construction companies submitted tenders for “the special maintenance on Route P44/1&2 between Deneysville and Jim Fouche from section one (01) to section four (04).”
The duration of the project was advertised to be six months only. Once the tender had been awarded, Roadmac Surfacing (Pty) LTD, being one of the unsuccessful tenderers, decided to embark on litigation.
On 11 January 2022, Roadmac Surfacing (Pty) LTD became aware that the tender had been awarded to the Tau Pele. It immediately reacted and requested reasons to be provided by 14 January 2022. No reasons were provided.
On 18 January 2022 its application for urgent relief, set down for 28 January 2022, was issued. The applicant sought a variety of orders in its original notice of motion, but it is not necessary to quote the same. Some issues have been resolved and will appear soon.
On 28 January 2022, an order was granted by the agreement. MEC Bulwane was directed to on or before 7 February 2022 file “full and written reasons” for the decision not to award the tender to the applicant.
The application was postponed to the unopposed roll of 10 February 2022 and it was agreed that the further prayers in the notice of motion, including for an interim interdict pending review, shall stand over.
On 10 February 2022, the reasons having been provided in the meantime, the court by agreement postponed the matter to the opposed roll of 24 March 2022. Further orders were granted on the filing of supplementary affidavits.
On 24 March 2022, the parties came before me. I was called upon to adjudicate whether interim relief should be granted to interdict the successful tenderer to continue with further work on the project pending the finalization of a review application.
It also needs to be pointed out that the applicant filed an amended notice of motion during the litigation.
In this document virtually the same relief is sought in Part A thereof, but Part B, providing for the review, differed from the initial notice of motion. The respondents objected to this alleged incorrect procedural approach. I decided not to become involved in any controversy in this regard and the orders granted reflect that attitude.
Roadmac Surfacing (Pty) LTD’s case
The Roadmac Surfacing (Pty) LTD submitted that a proper case has been made out for interlocutory relief pending the finalization of a review application to set aside the first respondent’s award of the tender to the second respondent. It is submitted that:
- on the first respondent’s version, the MEC’s tender had been discarded and the tender awarded to the second respondent based on a process that was not fair, equitable, transparent, comparative, or cost-effective;
- the reasons advanced by the MEC establish reviewable irregularities;
- the 30% sub-contracting requirement was not a pre-qualification requirement in terms of the eligibility criteria, being the first stage of the evaluation process;
- the Preferential Procurement Regulations of 2017 have been declared invalid by the Supreme Court of Appeal, and may I add, this decision was confirmed by the Constitutional Court;
Roadmac Surfacing (Pty) LTD tender was for R38 803 821.40, the lowest of all the tenders, whilst the second Tau Pele’s tender that was accepted, amounted to R51 615 000.00, R12 million more than that of the applicant; it was also the fifth-lowest tender.
THE DEFENCES
The MEC and Tau Pele Construction relied on several defenses which can be summarised as follows:
on 7 February 2022, the first respondent’s Acting Director: Legal Services responded in an email to the office of the State Attorney wherein he belatedly provided reasons why Roadmac Surfacing (Pty) Ltd was not the successful bidder.
“It is a known fact that Pre-qualification being stage one (1) is compulsory for the contractor must complete 30% subcontracting amount. The criteria found their way in terms of Section 14 subparagraphs 14.1 to 14.6 of Preferential Procurement Regulations, 2017 on the Preferential Procurement Policy Framework Act now of 2000.
We further refer Roadmac Surfacing (Pty) LTDto SBD 6.1 of its tender whereby it says “Not applicable” while it is a MUST to give the subcontracting amount as part of the terms and conditions of the tender.
The Roadmac Surfacing (Pty) LTD submitted that a proper case has been made out for interlocutory relief pending the finalization of a review application to set aside the first respondent’s award of the tender to the second respondent. It is submitted that:
- on the first respondent’s version, the applicant’s tender had been discarded and the tender awarded to the second respondent based on a process that was not fair, equitable, transparent, comparative, or cost-effective;
- the reasons advanced by the MEC establish reviewable irregularities;
- the 30% sub-contracting requirement was not a pre-qualification requirement in terms of the eligibility criteria, being the first stage of the evaluation process;
- the Preferential Procurement Regulations of 2017 have been declared invalid by the Supreme Court of Appeal, and may I add, this decision was confirmed by the Constitutional Court;
the applicant’s tender was for R38 803 821.40, the lowest of all the
Judge Daffue went on to explain which regulation the MEC should have relied upon to disqualify Roadmac Surfacing (Pty) LTD.
“Regulation 4 of the 2017 regulations is the only regulation dealing with the 30% subcontracting requirement as a prequalification criterion, but the MEC did not rely on this regulation for the decision of disqualifying Roadmac Surfacing (Pty) LTD.
In any event and in so far as the MEC wanted to rely on regulation 4, it should have been advertised with the specific tender condition, which he failed to do.”
He continued, “The uncertainty of the MEC as to which regulation to its application is an ambiguity in itself and prima facie a sufficient ground exists to have the tender awarded to Tau Pele Construction reviewed and set aside.”
In handing judgment Judge Daffue said.
“In conclusion a final word on the 2017 regulation. These regulations were declared invalid.
A reviewing court will have an opportunity to consider this aspect again although the tender process was initiated and finalized during the period of when declaration invalidity was suspended.”
PRT is no stranger to court cases after Judge Mhlambi dismissed applications by both PRT and Ket Civils.
What’s shocking is how can MEC who has a legal department rely on a nonexistent regulation to disqualify Roadmac Surfacing (Pty) Ltd?
How is this even possible?
Worse the advert does not stipulate that.
Surely they read section 14 of invalid regulations and they should have known.
Last week Premier Sefora Ntombela took a tour around the provincial roads and said they have spent R115 million to refurbish 23 km.
Hillary Mophethe, PRT spokesperson, and Pieter Muller, Director at Tau Pele Construction did not respond to our questions while Roadmac Surfacing (Pty) LTD could not be reached.
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