THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT

Reportable
Case no: 846/2021

In the matter between:
CITY OF EKURHULENI METROPOLITAN
MUNICIPALITY
APPELLANT

and

TAKUBIZA TRADING & PROJECTS CC
FIRST RESPONDENT

ZUTARI (PTY) LTD
SECOND RESPONDENT

NTIYISO CONSULTING (PTY) LTD
THIRD RESPONDENT

Neutral citation:  City of Ekurhuleni Metropolitan Municipality v Takubiza
Trading & Projects CC and Others (Case no 846/2021) [2022]
ZASCA 82 (03 June 2022)
Coram:
PONNAN and MABINDLA-BOQWANA JJA and MEYER,
MATOJANE and PHATSHOANE AJJA
Heard:

26 May 2022
Delivered:
03 June 2022

Summary: Tender – award of after expiry of tender validity period – once tender
validity period expired – tender process completed, albeit unsuccessfully.

__________________________________________________________________

ORDER
__________________________________________________________________

On appeal from: Gauteng Division of the High Court, Johannesburg (Victor J,
sitting as court of first instance):
(1)
The appeal is dismissed with costs.
(2)
The appellant’s Johannesburg and Bloemfontein attorneys shall not be entitled
to recover any of the costs associated with the preparation, perusal or copying of the
record from the appellant.
__________________________________________________________________

JUDGMENT
__________________________________________________________________
Ponnan JA (Mabindla-Boqwana JA and Meyer, Matojane and Phatshoane
AJJA concurring)
[1] In March 2020, the appellant, the City of Ekurhuleni Metropolitan
Municipality (the Municipality), published an invitation to tender under reference
PS-F07-2020 (the tender) for the appointment of finance meter management
consultants to manage the Municipality’s electricity and water meter readings and
credit control processes on an ‘as and when’ required basis for a 36-month period.
Appointments were sought to be made in respect of two separate areas, namely the
North East (area 1) and South West (area 2). The total value of the tender amounted
to some R117 million, being approximately R37 million in respect of area 1 and R79
million in respect of area 2.

[2] The initial closing date for the tender was 24 April 2020. However, due to the
COVID-19 pandemic and resultant national lockdown, the closing date had to be
extended to 11 June 2020. The bid validity period was 120 days from the closing
date, being 9 October 2020. On that date at 11h47, Ms Sanjuka Makhan, the ICT
Acquisition Specialist: Supply Chain Management in the Finance Department of the
Municipality, despatched the following email to all 24 bidders:
‘SUBJECT: REQUEST FOR EXTENSION OF VALIDITY: PS-F 07-2020
THE APPOINTMENT OF FINANCE METER MANAGEMENT CONSULTANTS TO
MANAGE THE CITY OF EKURHULENI’S WATER AND ELECTRICITY METER
READINGS AND CREDIT CONTROL PROCESSES, ON AN AS AND WHEN REQUIRED
BASIS FROM 01 JULY 2020 UNTIL 30 JUNE 2023.
Contract number PS-F 07-2020 120 day validity period will expire on 09 October 2020.
You are kindly requested to indicate whether you are accepting the extension of validity until 31
December 2020.
Please confirm by completing the note below and return by e-mail to:
Sanjuka.Makhan@ekhuruleni.gov.za
Kindly note that the confirmation is required on or before 9 October 2020. . . .’

[3] According to the Municipality:
‘91 . . . The email was sent to [Aurecon South Africa Pty Ltd (Aurecon)] at the email address:
benoni@aurecon.com. A short while later, Ms Makhan received a “no delivery notification” from
Microsoft Outlook which included no delivery in respect of [Aurecon].
. . .
According to Ms Makhan, pursuant to receiving the notification from Microsoft Outlook,
she discovered that some email addresses of bidders had been captured incorrectly on the system
– it included [Aurecon’s] email address. She states that once the typographical errors were
corrected she re-sent the email separately to affected bidders.

The letter was subsequently sent to [Aurecon] on 9 October 2020 at 15h32 to the correct
email address: benoni@aurecongroup.com. [Aurecon] emailed its confirmation on 12 October
2020 at 16h43 . . .
Ms Makhan states that there was not a deliberate delay to any specific bidder to jeopardize
them in any way. The extension notices were sent to all the bidders by the close of business on 9
October before the validity period had ended. Ms Makhan concedes that it would have been
preferable to have sent the letter to the bidders earlier.
96.
According to Ms Makhan, all the bidders, bar one, agreed to the extension, with three other
bidders also indicating their agreement after the deadline. Bidder 8 did not respond to the extension
letter. None of the bidders were disqualified from being evaluated due to their late response to the
letter, or in the case of bidder 8, due to its non-response. A bidder would only have been excluded
if it had responded to the extension letter and explicitly rejected the extension of the validity
period.’1

[4] On 19 November 2020, the Bid Evaluation Committee of the Municipality
(the BEC) recommended to the Bid Adjudication Committee (the BAC) that the
second respondent, Zutari (Pty) Ltd (previously known as Aurecon South Africa
(Pty) Ltd (Aurecon)), and the third respondent, Ntiyiso Consulting (Pty) Ltd
(Ntiyiso), be awarded the tender for area 1 and area 2, respectively. On 23 November
2020, the BAC accepted the recommendation of the BEC. The City Manager and
the Chairperson of the BAC approved the award to each of Aurecon and Ntiyiso on
24 November 2020 and, by letter dated 17 December 2020, they were informed of
their appointment.

[5] Having informally learnt on 11 January 2021 that it was unsuccessful, the first
respondent, Takubiza Trading & Projects CC (Takubiza), caused an urgent review

1 This being the explanation advanced in the answering affidavit filed on behalf the Municipality.

application to be issued out of the Gauteng Division of the High Court, Johannesburg
(the high court). The application was heard by Victor J on 22-23 April 2021, who,
in a judgment delivered on 14 of June 2021, set aside the award to both Aurecon and
Ntiyiso, but suspended the declaration of invalidity for a period of 150 days to enable
the Municipality to commence with a new tender process.

[6] Takubiza’s primary contention, which found favour with the high court, is that
the award to each of Aurecon and Ntiyiso had been made after the tender validity
period had already lapsed. In support of that contention, Takubiza called in aid a line
of high court authority commencing with the judgment of Southwood J in Telkom
SA v Merid Training (Pty) Ltd and others; Bihati Solutions (Pty) Ltd v Telkom SA
and others (Telkom SA).2 In that matter, Telkom published a request for proposals in
order to appoint service providers. The request stipulated a closing date and a tender
validity period of 120 days from the closing date, during which offers made by
bidders would remain open for acceptance. By the time the tender validity period
had expired, no decision had been taken by Telkom, and the tender validity period
had not been extended. Despite this, Telkom continued to evaluate and shortlist the
bidders. It was only after the tender validity period had expired that Telkom sent e-
mails to the 15 shortlisted bidders requesting them to agree to an extension of the
tender validity period. Some, including the six successful bidders, agreed to do so.
The decision to accept the bids of the six respondents was taken only after the expiry
of this further period. Before any contract was concluded with the six bidders,
Telkom decided, on legal advice, to apply for the setting aside of its own decision.

2 Telkom SA Limited v Merid Training (Pty) Ltd and Others; Bihati Solutions (Pty) Ltd v Telkom SA Limited and others
[2011] ZAGPPHC 1.

[7] Southwood J took the view that:
‘The question to be decided is whether the procedure followed by the applicant and the six
respondents after 12 April 2008 (when the validity period of the proposal expired) was in
compliance with section 217 of the Constitution. In my view it was not. As soon as the validity
period of the proposals had expired without the applicant awarding a tender the tender process was
complete ─ albeit unsuccessfully ─ and the applicant was no longer free to negotiate with the
respondents as if they were simply attempting to enter into a contract. The process was no longer
transparent, equitable or competitive. All the tenderers were entitled to expect the applicant to
apply its own procedure and either award or not award a tender within the validity period of the
proposals. If it failed to award a tender within the validity period of the proposals it received it had
to offer all interested parties a further opportunity to tender. Negotiations with some tenderers to
extend the period of validity lacked transparency and was not equitable or competitive. In my view
the first and fifth respondents’ reliance only on rules of contract is misplaced.’3

[8] Telkom SA was followed by Plasket J in Joubert Galpin Searle Inc & others
v Road Accident Fund & others (Searle).4 The facts in Searle were these: On 13 July
2012, the respondent, the Road Accident Fund (RAF), advertised a ‘request for
proposals’ with the description ‘Panel of Attorneys for [RAF] to provide specialist
litigation services’. The RAF invited suitably qualified legal firms from all provinces
to be listed on a panel of attorneys to provide specialist litigation services in various
specified categories. The closing date for the submission of bids was 20 August 2012
and the tender validity period was ‘90 days from the closing date’. It would appear
that the process was complex and time-consuming and did not always run smoothly.
The Bid Evaluation Committee (the BEC) finalised the evaluation of all of the bids
on 21 September 2012. An evaluation report was finalised by the BEC on 2

3 Ibid para 14.
4 Joubert Galpin Searle Inc and Others v Road Accident Fund and Others [2014] ZAECPEHC 19; [2014] 2 All SA
604 (ECP); 2014 (4) SA 148 (ECP).

November 2012 and tabled before a meeting of the Procurement Control Committee
(the PCC) on 5 December 2012. On 5 August 2013, the RAF wrote to bidders to
inform them that it had taken a decision to proceed with its proposal concerning the
extension of the tender validity period. It asked bidders to ‘amend and renew’ their
bids in accordance with this decision by 13h00 on 14 August 2013.

[9] Plasket J, who took the view that the judgment in Telkom SA was ‘essentially
on all fours with [Searle]’,5 observed:
‘[68] As with this case, what had to be decided, according to Southwood J, was “the legal
consequence of a failure by a public body to accept, within the stipulated validity period for the
(tender) proposals, any of the proposals received.” In deciding this issue, Southwood J’s starting
point was four inter-related propositions. They are that: (a) the decision to award a tender is an
administrative action and the PAJA therefore applies; (b) generally speaking, once a contract has
been entered into following the award of a tender, the law of contract applies; (c) but a contract
entered into contrary to prescribed tender processes is invalid; and (d) consequently, “even if no
contract is entered into, all steps taken in accordance with a process which does not comply with
the prescribed tender process are also invalid.”
. . .
[70] I am in agreement with Southwood J for the reasons given by him. As a result, it is my view
that, in this case, once the tender validity period had expired on or about 20 November 2012, the
tender process had been completed, albeit unsuccessfully.’

[10] Telkom SA and Searle have been cited with approval in several subsequent
judgments.6 However, the argument advanced on behalf of the Municipality is that

5 Ibid para 66.
6 See, inter alia, SAAB Grintek Defence (Pty) Ltd v South African Police Services and Others [2015] ZAGPPHC 1;
2015 JDR 0080 (GP); Tactical Security Services CC v Ethekwini Municipality 2017 JDR 1558 (KZD); Secureco (Pty)
Ltd v Ethekwini Municipality and Others [2016] ZAKZDHC 14 and Ethekwini Municipality v Mantengu Investments
CC and Others [2020] ZAKZDHC 11.

this weighty body of authority is distinguishable because, so the argument goes,
here, unlike in those matters, the Municipality took steps (in the form of the
notification from Ms Makan) before the expiration of the validity period. As I shall
endeavour to show, there are several reasons why any distinction, as may exist
between those matters and the present, is a distinction without a difference.

[11] First, the Municipality has quite inexplicably advanced no explanation as to
why the notification was despatched on the very last day of the tender validity period.
That aside, second, a real difficulty for the Municipality is that the notification from
Ms Makan, required ‘confirmation’, for good reason, from all of the bidders ‘on or
before 9 October 2020’, which, did not happen. Conceptually, there can be no
difference between the situation encountered here, where the confirmation sought is
not received by the organ of state within the stipulated period, and that dealt with in
Telkom SA and Searle (and the cases that followed them), where the notification is
only despatched by the organ of state after the period has expired. Surely, both stand
on the same footing: and in both, so it seems to me, the same consequence must
inexorably follow. It is difficult to appreciate why an organ of state would be better
placed, merely because it has despatched a request to which it has not received a
favourable response before the expiration of the validity period, compared to one
that only takes such a step after the expiry of that period. Here, the despatch of the
notification plainly did not serve to achieve its intended purpose and, in truth, was
so late as to be more illusory than real.

[12] Third, to borrow once again from Plasket J (Searle para 74):
‘. . . By the time the tender validity period has expired, there is nothing to extend because, as
Southwood J said in Telkom, the tender process has been concluded, albeit unsuccessfully. The

result, in this case, is that the RAF had no power to award the tender once the bid validity period
had expired and it had no power to extend the period as it purported to do. In the language of s
6(2)(a)(i) of the PAJA, the decision-maker – the board, in this instance – “was not authorised” to
take the decision. Put in slightly different terms, there were no valid bids to accept, so the RAF
had no power to accept the expired bids.’
In Tactical Security Services CC v Ethekwini Municipality and Others,7 which
considered the question whether the validity of bids can be extended by agreement
after they had expired, Ploos van Amstel J pointed out that a tender is defined in the
Preferential Procurement Regulations as ‘a written offer in the prescribed or
stipulated form in response to an invitation by an organ of state for the provision of
services, works or goods, through price quotations, advertised competitive tendering
processes or proposals’.8 He accordingly held that without an extension, the tender,
like any other offer, falls away, if it is not accepted in time. Accordingly, that come
the 10th of October, there was no longer a valid tender from Aurecon for the
Municipality to accept.

[13] Fourth, as was held by the high court, the validity period is indeed one of the
fundamental ‘rules of the game’, being the period within which the process should
be finalised. To extend the tender validity period, the consent of all the participants
to the tender process is required. Unless there is a timeous request and favourable
response from all the tenderers prior to the expiry of the tender, the tender comes to
an end. The view taken by the high court in this matter accords with the judgment of
the full court (Daffue JP and Mhlambi J) in Defensor Electronic Security (Pty) Ltd
v Centlec SOC Ltd, where the following was said:

7 Tactical Security Services CC v Ethekwini Municipality 2017 JDR 1558 (KZD).
8 Ibid para 10.

‘. . . It is the applicant’s case that the first respondent awarded the tender to the second respondent
after expiry of the tender validity period and without a prior request for extension and approval of
all relevant bidders. The tender validity period expired on 2 March 2021. Although the first
respondent relied on letters addressed to applicant and second respondent dated 1 March 2021, the
day before expiry of the tender, there is no proof that the request for extension was communicated
to the bidders prior to the expiry and the bidders consented to the extension of the period prior to
expiry thereof. In fact, applicant has proved that the request for extension was sent by e-mail to it
as late as 23 March 2021. It is the applicant’s case that once the tender validity period has expired,
it was not possible to resuscitate it. A new bid process had to be initiated in order to ensure that all
interested parties were provided a further opportunity to tender. I am in respectful agreement with
the judgment of Southwood J in Telkom SA Ltd v Merid Training (Pty) Ltd and others; Bihiti
Solutions (Pty) Ltd v Telkom SA and others relied upon by Mr Cilliers. I therefore also agree with
the applicant’s counsel that in the absence of the required proof that there was after the expiry date
no longer any valid tender process. The tender award has to be set aside for this reason alone.’9

[14] Fifth, the signification of confirmation by Aurecon on the 12th could not
somehow have had the effect of turning the clock back to the 9th and breathing life
into the process with retrospective effect to that date. What the argument advanced
on behalf of the Municipality boils down to is that whereas, as a fact, there was
confirmation only on the 12th, it fell to be treated as if, to all intents and purposes,
that had occurred on the 9th. What then of the period that intervened between the 9th
and 12th (namely the 10th and 11th); what would the status of the tender process have
been in that period? If not completed, then what? If completed, albeit unsuccessfully,
then how could it possibly be resuscitated? What if, instead of the 12th, the
confirmation from Aurecon had only come much later, say after several more days,

9 Defensor Electronic Security (Pty) Ltd v Centlec SOC Ltd and another [2021] ZAFSHC 315 para 8.

weeks or months? What would the status of the tender have been in that extended
period between the 9th and confirmation?

[15] It goes without saying that a tender process cannot be open-ended. Certainty
has to be the touchstone.10 I can thus conceive of no reason why the principle so
firmly established in Telkom SA and Searle does not find application here. It follows
that the appeal must fail.

[16] It remains to comment on the lamentable state of the record. It consists of 12
main volumes consisting of 2244 pages and one supplementary volume of 111
pages. It is replete with all manner of irrelevant material. Much of it is barely legible,
with inadequate line numbering and no proper cross-referencing to speak of. Bulk
was added by pasting photostatic copies over other pages, resulting often enough in
pages sticking together and having to be prised apart. No heed was paid to the
requirement that volumes should be so bound that upon being opened they will
remain open or that, in use, the binding will not fail.

[17] Such was the state of the record, that the registrar would have been entitled to
have rejected it. An order striking the matter from the roll may also not have been
unwarranted. However, prior to the hearing of the appeal, the appellant was invited
to file supplementary heads of argument to address the failure to properly comply
with the rules and what consequence, if any, should follow. In those heads, it was
stated somewhat euphemistically that ‘there were shortcomings in the preparation of

10 Tahilram v Trustees, Lukamber Trust and Another [2021] ZASCA 173; 2022 (2) SA 436 (SCA) para 24.

the record’. The heads then proceed to identify some of the shortcomings, but not all
of them.

[18] Given the unnecessary volume and the state of the record as a whole some
sanction must follow. This Court has previously expressed its displeasure at records
that include unnecessary documents of the kind encountered here and has, where
appropriate, ordered costs to be paid by attorneys de bonis propriis or disallowed the
costs of perusing the record.11

[19] Despite having filed a record in excess of 2300 pages, we were told in the
practice note filed by Counsel for the Municipality that only some 350 pages were
relevant. From the bar, Counsel accepted that even that was an over-estimation.
Indeed, from what is set out earlier in this judgment, it is patent that the facts fall
within a very narrow compass. On the point held to be decisive of the appeal, the
record ought not to have exceeded one volume. It would not be right for the residents
of the Municipality to be burdened with costs that should not have been incurred in
the preparation, perusal and copying of the record.

[20] In the result:
(1)
The appeal is dismissed with costs.
(2)
The appellant’s Johannesburg and Bloemfontein attorneys shall not be entitled
to recover any of the costs associated with the preparation, perusal or copying of the
record from the appellant.

11 Municipal Manager: Qaukeni and Others v F V General Trading CC [2009] ZASCA 66; 2010 (1) SA 356 (SCA);
[2009] 4 All SA 231 (SCA) para 31 and the cases there referred to.

_________________
V M Ponnan
Judge of Appeal

APPEARANCES

For appellant:

N H Maenetje SC (with U Dayanand-Jugroop)

Instructed by:

Seanego Attorneys, Pretoria

Blair Attorneys, Bloemfontein

For first respondent:

A P J Els (with K N Peterson)

Instructed by:
Albert Hibbert Attorneys, Pretoria

Webbers Attorneys, Bloemfontein.

THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
MEDIA SUMMARY OF JUDGMENT DELIVERED IN THE SUPREME COURT OF APPEAL

From:
The Registrar, Supreme Court of Appeal
Date:

03 June 2022
Status:
Immediate
The following summary is for the benefit of the media in the reporting of this case and does not
form part of the judgments of the Supreme Court of Appeal
City of Ekurhuleni Metropolitan Municipality v Takubiza Trading & Projects CC and Others (Case no
846/2021) [2022] ZASCA 82 (03 June 2022)
Today the Supreme Court of Appeal (SCA) handed down judgment dismissing, with costs, an appeal
against a decision of the Gauteng Division of the High Court of South Africa, Johannesburg (the high
court).
In March 2020, the appellant, the City of Ekurhuleni Metropolitan Municipality (the Municipality),
published an invitation to tender under reference PS-F07-2020 (the tender) for the appointment of
finance meter management consultants to manage the Municipality’s electricity and water meter
readings and credit control processes on an ‘as and when’ required basis for a 36-month period.
Appointments were sought to be made in respect of two separate areas, namely the North East (area
1) and South West (area 2). The initial closing date for the tender was 24 April 2020. However, due to
the COVID-19 pandemic and resultant national lockdown, the closing date had to be extended to 11
June 2020. The bid validity period was 120 days from the closing date, being 9 October 2020. On that
date at 11h47 the Municipality sent an email notification to all of the bidders enquiring whether they
would accept an extension of validity until 31 December 2020. The Municipality required confirmation
‘on or before 9 October 2020’. However, the notification was not delivered to one of the bidders, who
was ultimately successful, namely, Aurecon South Africa (Pty) Ltd (Aurecon). It was subsequently re-
sent at 15h32 that day to the correct email address. Aurecon only responded, some three days after
the bid validity period had expired, on 12 October 2020.
On 19 November 2020, the Bid Evaluation Committee of the Municipality (the BEC) recommended to
the Bid Adjudication Committee (the BAC) that Aurecon and Ntiyiso Consulting (Pty) Ltd (Ntiyiso), be
awarded the tender for area 1 and area 2, respectively. On 23 November 2020, the BAC accepted the
recommendation of the BEC. The City Manager and the Chairperson of the BAC approved the award
to each of Aurecon and Ntiyiso on 24 November 2020 and, by letter dated 17 December 2020, they
were informed of their appointment. Having informally learnt on 11 January 2021 that it was
unsuccessful, Takubiza Trading & Projects CC (Takubiza), caused an urgent review application to be
issued out of the high court. The application was heard on 22 - 23 April 2021, and on 14 June 2021 the
court set aside the award to both Aurecon and Ntiyiso, but suspended the declaration of invalidity for a
period of 150 days to enable the Municipality to commence with a new tender process.
Takubiza’s primary contention, which found favour with the high court, was that the award to each of
Aurecon and Ntiyiso had been made after the tender validity period had already lapsed. The SCA
reasoned that: firstly, there was no explanation from the Municipality as to why the notification was
despatched on the very last day of the tender validity period. Secondly, a real difficulty for the
Municipality was that their notification, for good reason, required confirmation from all of the bidders on
or before 9 October 2020, which, did not happen. The Court further held that an organ of state cannot
be better placed merely because it had despatched a request to which it was yet to receive a response
before the expiration of the validity period. In truth, the despatch of the notification was so late as to be

more illusory than real. Thirdly. by the time the tender validity period had expired, there was nothing to
extend because, the tender process had been concluded, albeit unsuccessfully. Come the 10th of
October, there was no longer a valid tender from Aurecon for the Municipality to accept. Fourthly, the
SCA agreed with the high court that the validity period was indeed one of the fundamental rules of the
game, being the period within which the process should be finalised. To extend the tender validity period
the consent of all the participants to the tender process was required. Unless there was a timeous
request and favourable response from all the tenderers prior to the expiry of the tender, the tender came
to an end. Lastly, the SCA held that the signification of confirmation by Aurecon on the 12th could not
somehow have had the effect of turning back the clock to the 9th and breathing life back into the process
with retrospective effect to that date. A tender process cannot be open-ended. Certainty has to be the
touchstone. The SCA accordingly concluded that the appeal must fail.
The SCA expressed its displeasure at the lamentable state of the appeal record, which was replete with
all manner of irrelevant material. Much of the record was barely legible, with inadequate line numbering
and no proper cross-referencing to speak of. Bulk was added by pasting photostatic copies over other
pages in the record, resulting often enough in pages sticking together that had to be prised apart. No
heed was paid to the requirement that volumes should be so bound that upon being opened they will
remain open or that, in use the binding would not fail. The SCA took the view that given the unnecessary
volume and the state of the record as a whole some sanction must follow. The Court had previously
expressed its displeasure at records that include unnecessary documents of the kind encountered here
and had, where appropriate, ordered costs to be paid by attorneys de bonis propriis or disallowed the
costs of perusing the record. The SCA concluded that it would not be right for the residents of the
Municipality to be burdened with costs that should not have been incurred in the preparation, perusal
and copying of the record. In the result, the SCA held that the appellant’s Johannesburg and
Bloemfontein attorneys should not be entitled to recover any of the costs associated with the
preparation, perusal or copying of the record from the appellant.

~~~~ends~~~~