Court name
High Court
Case number
149 of 2012
Title

Amswohl & LGA Construction JV CC v Municipal Council of the Municipality of Namibia (149 of 2012) [2012] NAHC 209 (27 July 2012);

Media neutral citation
[2012] NAHC 209
Coram
Kauta AJ





CASE NO: (T) A217/2004






CASE
NO.: A 149/2012






IN
THE HIGH COURT OF NAMIBIA






In
the matter between:






AMSWOHL
& LGA CONSTRCUTION JV CC
…...................................APPLICANT






and






THE
MUNICIPAL COUNCIL OF THE MUNICIPALITY


OF
NAMIBIA
…...........................................................................RESPONDENT










CORAM:
KAUTA, AJ










HEARD
ON: 19TH JULY 2012



RELEASED ON: 27TH
JULY 2012











JUDGEMENT






KAUTA,
AJ:
[1] The Applicant approached this Court on an urgent
basis for an interdict and certain ancillary relief. After hearing
oral argument on 19 July 2012 I reserved judgment. The Applicant
sought an order in the following terms:














  1. Condoning Applicant’s
    non-compliance with the forms and service provided for in the Rules
    and authorizing the Applicants to bring this application on an
    urgent basis as contemplated in Rule 6(12) of the Rules of Court.










  1. Interdicting and
    restraining the Respondent directly or indirectly, and though its
    servants or agents or otherwise, from:











    1. interfering with
      Applicant’s right to work and performing the contracts works,
      being the subject matter of an agreement concluded between
      Applicant and Respondent on or about 29 May 2012 relating to the
      construction of civil services in Gobabis in consequence to the
      successful award of Tender GN 01/2012 by Respondent to Applicant;
      and



    2. implementing or
      otherwise giving effect to the purported suspension of the above
      agreement by the Respondent with effect from 7 June 2012.











  1. That paragraphs 2.1
    and 2.2 above will operate forthwith as interdicts pendent lite.










  1. That Respondent pays
    the costs of this application.









BACKGROUND








[2]
The Government of the Republic of Namibia through its Targeted
Intervention Programme for Employment and Economics Growth (TIPEEG)
provided funds to the Respondent for the development of certain
infrastructure in Gobabis. The intention it appears was to uplift the
communities in Gobabis with the provision of water, sewage and road
infrastructure. To this end the Permanent Secretary of the Ministry
of Regional and Local Government, Housing and Rural Development
appointed Element Consulting Engineers on the 6
th
of September 2011, on behalf of the
Respondent.








[3] The Respondent
advertised a tender for the construction of civil services in
Gobabis, namely Tender No: GN 01/2012. The closing date of this
tender was Friday, 24 February 2012 at 11h00.








[4] The Applicant
participated in the tender as did two other entities that are not
party to this application.








[5]
The crisp and decisive issue
calling
for decision is whether the Respondent awarded Tender No: GN 01/2012
to the Applicant. In determining this issue it is important to decide
whether the Respondent is estopped by conduct. It is to this issue I
turn after a brief exposition of the facts in this matter.








[6]
The Applicant’s critical averments in support of its
application are that it was awarded Tender No: GN 01/2012 and
agreements were concluded on or about 29 May 2012. The contract
agreement with the Applicant is signed by the Town Engineer and
Manager of Finance of the Respondent. Due to the nature of the
defense raised by the Respondent, the Applicant contends that the
Respondent by the application of the turquand rule is bound by the
conduct of its officials. The Applicant makes this averment because
of a letter written by the Chief Executive Officer of the Respondent
on the 21
st
of May 2012 to appoint Applicant. To
bolster the above ascertain the Applicant also rely on the fact that
the Chief Executive Officer of the Respondent was present when the
agreement was concluded and signed between the parties. It is not
disputed that a formal site handover took place on the 29
th
of May 2012 and despite the presence
of the Chief Executive Officer of the Respondent there were no
objections thereto.








[7]
In answer to these critical facts the Respondent asserts that its
Local Tender Board resolved “
to
consider awarding the tender to Amswohl & LGAJV
.
And consequently mandated its Chief Executive Officer on 21
st
May 2012 to “confirmed
that the appointment of the highest scoring tenderer namely Amswohl &
LGAJV can be effected without delay, so that negotiations can only
take place after appointment
.
The Respondent further take issue with the fact that the contract
agreement with Applicant is not signed by its Chief Executive Officer
as provided for in Section 31A of the Local Authorities Act No. 23 of
1992. As a result of the above the Respondent take the view that it’s
Local Tender Board made no award in accordance with the Tender Board
of Namibia Act No. 16 of 1996. In substantiation of its position the
Respondent relies on the minutes of its Tender Board of the 8
th
of May 2012, which resolved among
others that Applicant “
be
engaged in negotiations in terms of rates
and
a letter to this effect was written by its Chief Executive Officer.
It appears that the Consulting Engineers wrote to the Applicant on
the 22
ndof
May 2012 and appointed them. When the defense of the Respondent is
striped to the bone it is essentially that even if the Applicant
proves the existence of the agreement it is null and void.








[8] It is obvious that
the parties are not ad idem on whether an agreement was concluded in
this matter. The approach which must be followed in resolving
disputes of fact has been qualified in Plascon-Evans Paints Ltd v Van
Riebeeck Paints (Pty) Ltd 1984 (3) SA 623 (A) at 634E-635A. Corbett
JA (as he then was) in this regard stated:








Secondly, the
affidavits reveal certain disputes of fact. The appellant
nevertheless sought a final interdict, together with ancillary
relief, on the papers and without resort to oral evidence. In such a
case the general rule was stated by Van Wyk J in Stellenbosch
Farmers' Winery Ltd v Stellenvale Winery (Pty) Ltd 1957 (4) SA 234
(C) at 235E-G, to be








"... where there
is a dispute as to the facts a final interdict should only be granted
in notice of motion proceedings if the facts as stated by the
respondents together with the admitted facts in the applicant's
affidavit justify such an order. Where it is clear that facts, though
not formally admitted, cannot be denied, they must be regarded as
admitted".








[9] In Tamarillo (Pty)
Ltd v B N Aitken (Pty) Ltd 1982 (1) SA 398 (A) Miller JA remarked as
follows at 430G-431A:








'A litigant is entitled
to seek relief by way of notice of motion. If he has reason to
believe that facts essential to the success of his claim will
probably be disputed he chooses that procedural form at his peril,
for the Court in the exercise of its discretion might decide neither
to refer the matter for trial nor to direct that oral evidence on the
disputed facts be placed before it, but to dismiss the application.
(Room Hire Co (Pty) Ltd v Jeppe Street Mansions (Pty) Ltd 1949 (3) SA
1155 (T) at 1168.) But if, notwithstanding that there are facts in
dispute on the papers before it, the Court is satisfied that on the
facts stated by the respondent, together with the admitted facts in
the applicant's affidavits, the applicant is entitled to relief
(whether in respect of all his claims or one or more of them) it will
make an order giving effect to such finding, with an appropriate
order as to costs. (Cf Stellenbosch Farmers' Winery Ltd v Stellenvale
Winery (Pty) Ltd 1957 (4) SA 234 (C) at 235; Burnkloof Caterers (Pty)
Ltd v Horseshoe H Caterers (Green Point) (Pty) Ltd 1976 (2) SA 930
(A) at 938.)'








[10] The Respondent is
a creature of statute. The powers and duties of the Council of the
Respondent are derived from the Local Authorities Act 23 of 1992, as
amended, in particulars by the Local Authorities Amendment Act 24 of
2000. In Part IV, Section 27(5) of the Act deals with the powers and
duties of Chief Executive Officers (CEOs). Such powers and duties may
be exercised by the CEO personally or by any officer or any employee
(determined by him) engaged in the carrying out of such provisions
under the CEO’s direction and control. Part V deals with the
powers and duties of Local Authority Councils, such as the Council of
the Respondent. Section 30 of the Act deals with what such Council
may do. Despite the specific powers of such Council may have, it may
generally do anything necessary or conducive to the exercise of its
powers. Section 30(4) provided that anything that has purportedly
been done by the chairperson of such Council, on instruction of the
Council in terms of the powers vested in the Council by the act or
any other law, shall be deemed to have been done by Local Authority
Council. Section 31 (as amended by Act 24 of 2000) specifically deals
with the delegation of powers by Local Authority Councils. It
provides:



31(1) A
municipal council or a town council may delegate or assign, in
writing and on such conditions as it may determine, to its management
committee or chief executive or any other staff member, any power
conferred or any duty imposed upon it by or under this Act or any
other law, except any power…”








Section 31(3) and (4)
provides:



(3) The
management committee may delegate, in writing and with the prior
written approval of and on the conditions determined by the municipal
council or town council concerned:




  1. any power conferred
    upon it by this Act; or



  2. any power which has
    been delegated to it subsection (1), to any member of the municipal
    council or town council, or to the chief executive officer or any
    staff member of the municipal council or town council concerned, or
    to any two or more of such persons conjointly.




(4) Local authority
council or a management committee shall not be divested of any power
delegated or assigned by it under subsections (1), (2) or (3), as the
case may be and may alter or withdraw any decision given by the
delegate in the exercise of such delegated power”








[11] By an amendment
(Act 24 of 2000) Parliament inserted in the Local Authorities Act a
new section namely Section 31A, in respect of signed of contracts.
This section provides:








any contract to
be entered into by a local authority council pursuant to a resolution
of the local authority council shall be signed by the chief executive
officer of the local authority council and be co-signed by:




  1. In the case of
    municipal council or town council, the chairperson of the management
    committee or any staff member of that council generally or
    specifically authorized thereof by the council concerned;



  2. In the case of a
    village council…..[not applicable]




and any contract so
signed shall be deemed to have been duly executed on behalf of the
local authority council”.








[12] This matter is
further complicated by Section 16 of the Tender Board of Namibia Act
No. 16 of 1996, which provides that:








(1) The Board
shall in every particular case-



(a) notify the
tenderers concerned in writing of the acceptance or rejection of
their tenders, as the case may be, and the name of the tenderer whose
tender has been accepted by the Board shall be made known to all the
other tenderers;



(b) on the written
request of a tenderer, give reasons for the acceptance or rejection
of his or her tender.








(2) Where in terms of a
title of tender-



(a) a written agreement
is required to be concluded after the acceptance of a tender, the
Board and the tenderer concerned shall, within 30 days from the date
on which that tenderer was notified accordingly in terms of
subsection (1)(a) or within such extended period as the Board may
determine, enter into such an agreement;



(b) a written agreement
is not required to be so concluded, an agreement shall come into
force on the date on which the tenderer concerned is notified in
terms of subsection (1)(a) of the acceptance of his or her tender.








(3) If, in the
circumstances contemplated in subsection (2)(a), the tenderer fails
to enter into an agreement within the period mentioned in that
subsection or, if that period has been extended by the Board, within
the extended period, or if the tenderer, when required to do so,
fails to furnish the required security for the performance of the
agreement, the Board may withdraw its acceptance of the tender in
question and-








(a) accept any other
tender from among the tenders submitted to it; or



(b) invite tenders
afresh.








[13] In Oshakati Towers
(Pty) Ltd v Executive Properties CC and Others 2009 (1) NR 232 at 245
G – H, (HC) Muller, J remarked that:








“….non-compliance
with a statutory requirement may render contracts unenforceable,
depending on the intention of the legislature”.








[14] The remarks of
Miller AJA, In Northgate Properties (Pty) Ltd v The Town Council of
the Municipality of Helao Nafidi and 4 Others (HC), Case No. A
350/2008 heard on 1st April 2011 and delivered on 5th May 2011 at
para [11] are apposite in this matter:








My finding that
Mr Shivolo [the Chief Executive Officer] did not have the authority
of the first respondent to sell and the consent of the relevant
Minister, leads to the inevitable finding that the sale was null and
void ab initio. To that I must add that in terms of section 31A of
the Local Authorities Act, any contract entered into shall be signed
by the Chief Executive Officer of the Local Authority Council and
shall be co-signed in the case of a municipality or a town council by
the chairman of the management committee or any staff member of that
council generally or specifically authorized thereto. This provision
is plainly cast in peremptory terms and the failure in the instant
case to comply with the provision provides a further basis upon which
the agreement is null and void.”








[15] The onus is on the
Applicant to prove the conclusion of a valid agreement in this
matter. Neither the Applicant nor the Respondent deemed it necessary
to resolve this issue with an explanation by the Chief Executive
Officer of the Respondent. This would no doubt have resolved the
stance taken by the Applicant. What is clear from the facts is that
there is no semblance of compliance with the provisions of Section
31A.