THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Reportable
Case No: 792/2015
In the matter between:

TASIMA (PTY) LTD

APPELLANT

and

THE DEPARTMENT OF TRANSPORT

FIRST RESPONDENT

THE DIRECTOR-GENERAL: DEPARTMENT
OF TRANSPORT

SECOND RESPONDENT

THE MINISTER OF TRANSPORT

THIRD RESPONDENT

WERNER EDUARD KOEKEMOER

FOURTH RESPONDENT

ROAD TRAFFIC MANAGEMENT CORPORATION

FIFTH RESPONDENT

COLLINS LETSOALO

SIXTH RESPONDENT

KEVIN JOSHUA KARA-VALA

SEVENTH RESPONDENT

MORNE GERBER

EIGHTH RESPONDENT

GILBERTO MARTINS

NINTH RESPONDENT

CHRIS HLABISA

TENTH RESPONDENT

MAKHOSINI MSIBI

ELEVENTH RESPONDENT

Neutral Citation:
Tasima (Pty) Ltd v Department of Transport (792/2015) [2015]
ZASCA 200 (2 December 2015)
Coram:

Brand, Cachalia, Majiedt, Saldulker, Mbha JJA
Heard:

23 November 2015
Delivered:

2 December 2015

Summary:  Administrative Law – Extension  of contract between appellant and first
respondent – court orders compelling respondents to comply with contract during
period of extension – application for committal of contempt of those orders and
related relief – contempt not dependent on validity of extension – counter-application
to set extension aside – time limit imposed by s 7 of PAJA.
___________________________________________________________________

ORDER
___________________________________________________________________

On appeal from:    North Gauteng Division of the High Court, Pretoria (Hughes J,
sitting as court of first instance):

It is ordered that:
(a) The appeal against both the dismissal of the main application and the order
granted in terms of the counter-application is upheld with costs, including the costs of
two counsel, against the first and fifth respondents, jointly and severally.
(b) The order of the court a quo is set aside and replaced with the following:
„An order is issued in the following terms:
1.
Declaring:
(a)
the first and second respondents to be in breach and contempt of:
(i)
paragraph 1.1 of the order of this court issued under case number
44095/2012, handed down by Mabuse J on 17 October 2012 (the Mabuse
Order);
(ii)
paragraph 3 of the order of this court issued under case number 44095/2012
handed down by Strijdom AJ on 26 March 2013 (the Strijdom Order);
(iii) paragraphs 5 and 6 of the order of this court issued under case number
44095/2012 handed down by Fabricius J on 27 August 2013 (the Fabricius
Order);
(iv) paragraph 1 of the order of this court issued under case number 44095/2012
handed down by Rabie J on 21 January 2014 (the Rabie Order);
(b)
the fifth and eleventh respondents to be in breach and contempt of:
(i)
paragraphs 5 and 6 of the Fabricius Order; and
(c)
the tenth respondent to be in breach and contempt of:

(i)
paragraph 1.1 of the Mabuse Order;
(ii)
paragraph 3 of the Strijdom Order;
(iii) paragraphs 5 and 6 of the Fabricius Order;
(iv) paragraph 4.1 of the order of this court issued under case number
44095/2012 handed down by Nkosi J on 5 November 2013 (the Nkosi
Order);
(v)
paragraph 1 of the Rabie Order;
2.
Ordering that:
(a)
no transfer of the eNaTIS and the services (as defined in the turnkey
agreement for the provision of the eNaTIS system (Contract RT1194KA) dated
3 December 2001, as subsequently amended and extended ( the turnkey
agreement) may take place except in terms of the transfer management plan
envisaged in schedule 15 to the turnkey agreement;
(b)
for the duration of the transfer of the eNaTIS and the services:
(i)
the applicant is to be paid, by the first respondent, for all services rendered
under the agreement, in accordance with, inter alia, the terms of the turnkey
agreement and paragraph 1.2 of the Mabuse Order;
(ii)
all purchase requisition orders are to be processed in accordance with, inter
alia, the terms of the turnkey agreement and paragraph 4 of the Nkosi Order;
and
(iii) all material contracts and agreements required to be approved by the first
respondent will be so approved within five days of the request by the
applicant;
(c)
the first, second, fifth, tenth and eleventh respondents are interdicted from
taking any steps to implement the purported transfer alluded to in the letters
dated 24 February 2015, 25 February 2015 and 4 March 2015 (the transfer
correspondence, which respectively comprise annexes FM27, FM25, and FM28
to the supporting affidavit of Fannie Lynen Mahlangu dated 12 March 2015), or
to implement any transfer of the eNaTIS, the services (as defined in the turnkey
agreement) or any related services contrary to 2.1 above;
(d)
the fifth respondent is to desist from advertising for any eNaTIS related
positions until at least a transfer management plan has been finalised in terms
of the turnkey agreement;
3.
Ordering that:

(a)
the second and tenth respondents be committed to imprisonment for a period of
30 days.
(b)
the order in paragraph 3(a) above will not come into operations unless there is
a breach of the order in paragraph 2(c) above;
(c)  a warrant of committal is to be issued by this court on the same papers, duly
supplemented as necessary, if the first, second and tenth respondents breach
the order in paragraph 2(c) above;
4.
Ordering the first and fifth respondents, jointly and severally, to pay the
applicant‟s costs of the application dated 12 March 2015, including the costs
of two counsel.
5(a)
Dismissing the first respondent‟s counter-application dated 26 March 2015;
(b)
Ordering the first respondent to pay the applicant‟s costs of the counter-
application, including the costs of two counsel.
___________________________________________________________________

JUDGMENT
___________________________________________________________________

Brand JA (Cachalia, Majiedt, Saldulker, Mbha JJA concurring):

[1] The appellant, Tasima (Pty) Ltd (Tasima), brought an application in the North
Gauteng High Court for relief essentially twofold in character. First, to declare five of
the eleven respondents in contempt of no fewer than seven court orders and,
secondly, to interdict all the respondents from acting in breach of these court orders.
The orders are defined in the papers by reference to the judges who granted them. I
propose to do the same. To the identity of the respondents, I shall presently return.
But for purposes of introduction it suffices to describe two of them only, namely, the
first respondent, which is the Department of Transport (the Department) and the fifth
respondent, which is the Road Traffic Management Corporation (RTMC) that owes
its corporate existence to s 3 of the Road Traffic Management Act 20 of 1999.

[2] The various court orders relied upon for the contempt application had their
origin in a turnkey agreement between Tasima and the Department concluded on 3

December 2001. It is common cause that the agreement would have expired in May
2007, but for an extension of the contract period relied upon by Tasima. The
application was opposed by a number of respondents. In addition, the Department
brought a counter-application to review and set aside the decision to extend the
contract period upon which Tasima‟s application relied. In the court a quo the matter
came before Hughes J, who dismissed Tasima‟s application and granted the
Department‟s counter-application, in both instances with costs. The appeal against
that order is with the leave of the court a quo.

Background
[3] The exact nature of the dispute between the parties and the issues that arose
for determination will be better understood against the factual background that
follows. It all started with a tender invited by the Department for the redevelopment
and implementation of the National Traffic Information System. The tender was
eventually awarded to Tasima. Tasima and the Department accordingly entered into
the turnkey agreement for the provision of the electronic National Traffic Information
System (eNaTIS), on 3 December 2001. eNaTIS is responsible for, amongst other
functions, the management of all licensing requirements and traffic systems. It allows
the Department to administer, across all nine provinces, the licensing of all motor
vehicles; driver‟s tests; learner licence tests; contraventions of road traffic legislation;
the roadworthiness of vehicles; and so forth. It acts as the interface amongst the
Department, all licensing institutions and municipalities; a variety of institutional
users such as the South African Police Service; motor manufacturers; the banking
industry; and the general public. By all accounts the eNaTIS system is a complex
one. It interacts with over 20 pieces of legislation; it manages a vehicle population of
over 11,3 million vehicles; it processes 380 million transactions per year at an
average of 1,6 million transactions per business day; it comprises millions of lines of
computer code and is imbedded into the national economy. The contract is evidently
a very valuable one.

[4] Although the turnkey agreement was concluded on 3 December 2001, it only
came into operation on 1 June 2002. In terms of clause 4, it was intended for a fixed
period of five years only, which would expire on 31 May 2007. The parties clearly
contemplated, however, that due to the complexity and wide-ranging import of the

eNaTIS system, its transfer from Tasima to the Department or a third party, could not
occur overnight. Hence clause 26 of the agreement provides:
„26 Transfer management upon termination
Upon termination of this agreement for any reason whatsoever and howsoever arising, in
order to ensure the smooth and uninterrupted transition of the services from [Tasima] to the
State, or its nominated contractor, [Tasima] shall comply with the transfer management
provisions set out in schedule 15.‟
Amongst the pertinent provisions of schedule 15 is the introduction in paragraph 1
which reads:
„In view of the strategic importance of the [eNaTIS system] to the State, it is necessary to
make provision for the orderly transfer of this [system] and services provided in respect
thereof from [Tasima] to the State or a third party provider should this agreement or any part
thereof terminate or expire for any reason whatsoever. This schedule contains the provisions
relating to such a transfer.‟

[5] Clauses 2.2 and 2.3 of the turnkey agreement provide that, within 90 days
after termination of the agreement, the Department can request from Tasima a
transfer management plan meeting and the Department and Tasima must agree on
a transfer management plan within 30 days of such request. This transfer
management plan must, in turn, provide timeframes for transfer, similar to the
Migration plan (which governed the original transfer of the system to Tasima), and
must be carried out in a timeframe substantially similar to that delineated in the
Migration plan. It is common cause that the Migration plan endured for a period of
five years from 2002 to 2007.

[6] On the eve of the expiry of the agreement on 31 May 2007, Tasima made
written representations to the then Director-General, Ms Mpumi Mpofu, for the
agreement to be extended beyond that date. But its representations did not find
favour with her. She accordingly wrote to Tasima that the agreement would
terminate on 31 May 2007 and that the eNaTIS system had to be transferred to the
Department in conformity with clause 26 and schedule 15. But the Department never
requested the transfer management meeting contemplated by clause 2.2 of schedule
15. Both Tasima and the Department accept that the contract then continued on a
month-to-month basis with no stipulated time period.

[7] Ms Mpofu‟s contract as Director-General came to an end on 30 October 2009
and Mr George Mahlalela was appointed in her stead. On 12 April 2010 Tasima
made written representations to the then Deputy Director-General, Mr Zakhele
Thwala, for the Department to consider giving Tasima an extension of the contract
for a further period of five years from 1 May 2010 and that it be permitted to develop
new software it would maintain for use by the public. Mr Mahlalela accepted the
recommendation and informed Tasima by letter dated 12 May 2010 that its contract
was extended to 30 April 2015.

[8] The extension was challenged by the Department‟s Chief Financial Officer, Mr
Collins Letsoalo, who was also the acting Chief Executive Officer of RTMC. He wrote
to Tasima on 21 May 2010, and again on 27 May 2010, advising it to ignore Mr
Mahlalela‟s letter, since that letter, he asserted, had been withdrawn. This was
followed by a further letter by Mr Mahlalela to Tasima, dated 18 August 2010, in
which he confirmed the extension of the contract, advised it to ignore any
instructions to the contrary from anyone else in the Department. On 22 June 2010
the Minister of Transport confirmed in Parliament that the Director-General had
extended the agreement and defended the extension essentially on the basis of the
importance of the eNaTIS system and the retention of special skills employed by
Tasima in its operation. Mr Mahlalela‟s contract as Director-General expired on 28
February 2013.

[9] The next episode in the saga occurred in March 2012 when Tasima received
a letter from the Department informing it that the turnkey agreement would terminate
on 31 May 2012. The reasoning underlying that view was formulated thus:
„The Department of Transport is of the opinion that the contract expired on May 31 2007,
and that transfer provisions were invoked that authorised the Department to transfer eNaTIS‟
services to the Department and placed an obligation on the service provider to continue with
the support of the system until transfer is completed. The maximum period for transfer to be
completed in five years expiring on 31 May 2012.‟

[10] Tasima‟s response was twofold. First, it invoked the dispute resolution
mechanism provided for in clause 24, read with schedule 13 of the turnkey
agreement. Secondly, it brought an application for an order that the Department be

directed to perform its obligations in terms of the agreement, pending the finalisation
of the dispute resolution proceedings which it had instituted. On 7 August 2011 Teffo
J granted an interim interdict against the Department which pendente lite preserved
the status quo until the finalisation of the main application. On 17 October 2012
Mabuse J decided the main application in favour of Tasima, and granted an order in
respect of which, pending the finalisation of the dispute resolution proceedings
instituted by Tasima, the Department was directed „to perform its obligations in terms
of the agreement‟ (the Mabuse J order). From the context of Mabuse J‟s judgment it
is clear that by his reference to „the agreement‟ he intended to include the alleged
extension of the contract period until 30 April 2015 (contended for by Tasima) as well
as the period of transition contemplated in clause 26 and schedule 15.
Subsequently, the Department‟s application for leave to appeal against the Mabuse J
order was refused, first by Mabuse J himself and then by this court. A debate arose
on the papers as to who was to blame for the fact that the dispute proceedings
instituted by Tasima in 2012 had not yet been finalised. As I see it, however, the
outcome of this debate is of no consequence. No application was brought to
discharge or terminate the Mabuse J order. So it remains extant.

[11] Nonetheless, from about September 2012 to about February 2014 the
Department, RTMC and at least some of the other respondents, have persistently
conducted themselves in a way which, from Tasima‟s perspective, constituted
contempt, first of the order by Teffo J and then of the order by Mabuse J. An
example of such conduct was the failure by the Department to grant the necessary
authorisations under the agreement to timeously pay amounts due. Furthermore, the
Department rerouted work under the agreement away from Tasima to the RTMC. In
consequence, Tasima brought no fewer than seven contempt of court applications,
and succeeded every time.

[12] At the beginning of 2015, so Tasima contended, the Department and RTMC
again started behaving in a manner which constituted contempt of the Mabuse J
order as well as the various court orders that followed. This gave rise to the present
litigation. In support of its contempt application Tasima relied in the main on letters
and emails sent on behalf of both the Department and RTMC which indicated in no
uncertain terms that the former intended to transfer the eNaTIS system in its totality

to the latter with effect from 1 May 2015. The basis for this attitude advanced by the
respondents was that the period of the contract, as extended in 2010, would
terminate on 30 April 2015. This, of course, completely ignored the transfer
provisions of schedule 15. In addition Tasima relied for its contempt application on
RTMC‟s advertising in newspapers for positions associated with the eNaTIS system.
RTMC‟s rather cynical answer to this complaint was that the advertisements were
aimed at enabling it to take over eNaTIS on 1 May 2015 and that its efforts to do so
proved successful in that „170 out of a total of some 230 skilled Tasima employees‟
have applied to take up these positions by 1 May 2015 These actions by the
Department and RTMC formed the foundation not only of Tasima‟s contempt of court
application, but also of its prayers for other related relief deriving from these orders.

[13] The Department‟s counter-application was for the setting aside, on the basis
of illegality, of the decision by the then Director-General, Mr Mahlalela, in May 2010
to extend the contract period for a further five years. This would, according to the
Department, constitute a defence to Tasima‟s contempt applications. This is so, the
Department argued, because the legality of the impugned extension was a
prerequisite for the relief sought by Tasima in its main claim. Conversely, argued the
Department, because the court would not compel it to continue giving effect to an
invalid agreement. As authority for these propositions the Department sought to rely
on the recent decision of this court in Minister of Transport NO & another v Prodiba
(Pty) Ltd [2015] 2 All SA 387 (SCA).

[14] The basis of the Department‟s legality challenge was formulated in its
supporting affidavit thus:
„The impugned extension was in clear contravention of s 217(1) of the Constitution in that it
was for the contracting of services without following a system that is fair, equitable,
transparent, competitive and cost effective.
In extending this contract Mahlalela failed to comply with Treasury Regulation 16A6.4, read
with Treasury Instruction Note 8 of 2007/2008 which provide that in urgent or emergency
cases or in case of a sole supplier, other means of procurement may be followed but that the
reasons for deviation should be recorded and approved by the accounting officer. The
proferred reasons were also lacking in rationality.

In terms of s 38(2) of the PMFA [ie Public Finance Management Act 1 of 1999] an
accounting officer may not commit a department, trading entity or constitutional institution to
any liability for which money has not been appropriated. When Mahlalela extended the
contract with effect from 1 May 2010, no money had been appropriated by the Department
for the extended contract.
. . .
. . . [A]s a result of this illegal extension the Department has received negative reporting from
the Auditor-General.
. . . [T]he relevant portion of the Department‟s annual financial statements for the year ended
31 March 2014 . . . [shows] that the Department is now forced to shift money from some of
its programmes in order to fund this contract. This is a direct result of the failure by Mahlalela
to comply with s 38(2) of the PFMA.‟

[15] The court a quo obviously endorsed the Department‟s thesis – also embraced
by RTMC – that the setting aside of the impugned extension of the contract period
would inevitably be the death knell for Tasima‟s main application. For once it upheld
the counter-application it gave no consideration to the charges of contempt of court
and the related relief sought by Tasima. With regard to RTMC the court a quo found
another reason why the claim against it could not succeed, namely, that „RTMC
cannot be in contempt of performance as it was not a party to the agreement‟.

Tasima’s application for committal orders and related relief
[16] I do not share the court a quo‟s view that the setting aside of the impugned
extension would insulate the respondents from a finding that they were in contempt
of court. On the contrary, as I see it, the outcome of the review application is entirely
irrelevant to the question whether the respondents were acting in contempt of the
court‟s orders. Should the review application be successful, it may impact on the
future in that it could serve as a basis for setting the court orders aside. But unless
and until these orders are set aside by a court of competent jurisdiction, they stand
and must be obeyed. That much was clearly stated by Streicher ADP in Clipsal
Australia (Pty) Ltd & others v GAP Distributors (Pty) Ltd & others 2010 (2) SA 289
(SCA) para 22. In a constitutional democracy based on the rule of law, court orders
must be complied with by private citizens and the State alike. As members of the
executive organs of State, the respondent are held to an even higher standard. Not
only must they act in strict compliance with court orders, but they are also bound to

facilitate the efficiency of the judicial branch (see eg Minister of Home Affairs &
others v Somali Association of South Africa Eastern Cape (SASA EC) & another
2015 (3) SA 545 (SCA) paras 34-36 and 27; and Nyanthi v MEC for the Department
of Health, Gauteng & another 2008 (5) SA 94 (CC) para 43). The setting aside of a
contract which forms the basis of a court order, does not negate the force of the
order nor does it excuse the failure to comply with it.

[17] The fact that RTMC was not a party to the contract between the Department
and Tasima is, in my view, equally irrelevant to the contempt inquiry. First, because
Tasima‟s case against RTMC was not based on breach of contract but on delictual
liability arising from intentional interference with contractual rights (see eg Dantex
Investment Holdings (Pty) Ltd v Brenner & others NNO 1989 (1) SA 390 (A)).
Secondly, and in my view of greater import, is the consideration that I have
mentioned before, namely, that court orders must be obeyed even if they are
considered to be wrong. Chaos and disorder will result if people are allowed to defy
court orders with impunity because they are thought to have been wrongly decided
(see eg Bezuidenhout v Patensie Sitrus Beherend Bpk 2001 (2) SA 224 (E) 228F-
230A).

[18] Civil contempt is the wilful and mala fide refusal or failure to comply with an
order of court. This was confirmed in Fakie NO v CCII Systems (Pty) Ltd 2006 (4) SA
326 (SCA) para 9. Fakie also held that whenever committal to prison for civil
contempt is sought, the criminal standard of proof applies (para 19). A declarator of
contempt (without imprisonment) and a mandatory order can however be made on
the civil standard (see Fakie para 42). The applicant for a committal order must
establish (a) the order; (b) service or notice of the order; (c) non-compliance with the
terms of the order and (d) wilfulness and mala fides, beyond reasonable doubt. But,
once the applicant has proved (a), (b) and (c), the respondent bears an evidentiary
burden in relation to (d) (Fakie para 42). Should the respondent therefore fail to
advance evidence that establishes a reasonable doubt as to whether his or her non-
compliance was wilful and mala fide, the applicant would have proved contempt
beyond a reasonable doubt (Fakie paras 22-24).

[19] I propose to apply these criteria first with reference to the Department and its
two officials, the Director-General and Mr Hlabisa, against whom committal orders
are sought. In doing so, it is clear to me that the applicant had established
requirements (a), (b) and (c). The Mabuse J order and the five subsequent contempt
orders were pertinently addressed to the Department and the Director-General, while
the terms of these orders were specifically rendered applicable to Mr Hlabisa by the
order of Nkosi J. It is common cause that these orders were served on these
respondents and that they were fully aware of their terms.

[20] Furthermore, I believe Tasima had demonstrated non-compliance with the
terms of these orders by the Department and its two officials concerned. So, for
example, these respondents were pertinently directed in terms of the Mabuse J order
to give effect to the terms of the turnkey agreement until the dispute resolution
proceedings had been finalised. The Fabricius J order interdicted them from taking
any steps which would have the effect of rerouting or diverting any of the works
pertaining to the eNaTIS system away from Tasima. I agree with Tasima‟s argument
that the transfer of the whole eNaTIS system from Tasima to RTMC on 1 May 2015,
to which these respondents committed themselves, clearly constituted non-
compliance with the terms of these court orders. The contention on behalf of these
respondents that they were not attempting to transfer the eNaTIS system to RTMC
on 1 May 2015, but that they were only taking preparatory steps to effect such
transfer at a later date, is in my view rather cynical and unsustainable on the facts.
As to requirement (d) of Fakie, these respondents gave no valid explanation for their
failure to comply with the orders against them. They sought instead to challenge the
extension of the contract period by way of a counter-application. In consequence
they have failed to discharge the evidentiary burden resting upon them to show that
their non-compliance was not wilful or mala fide. It follows that Tasima has
succeeded in proving contempt against the Department and its two officials beyond a
reasonable doubt.

[21] Very much the same considerations apply in respect of RTMC. Although it
was not a party to the Mabuse J order, the subsequent order by Fabricius J was
pertinently directed against it. In terms of paragraph 5 of that order the respondents
– including RTMC – were „interdicted from taking any steps which would have the

effect of rerouting or diverting any of the work (as defined in paragraph 3 of the order
granted by the Hon Mr Acting Justice Strydom on 26 March 2013) . . .‟ An argument
raised on behalf of RTMC was that the reference to another court order – by
Strydom AJ – which order was not directed against it, rendered the contents of the
Fabricius J order unclear. I believe, however, that there are two answers to this
argument. The first is that the deponent to RTMC‟s answering affidavit – Mr Msibi –
raised no difficulty with regard to understanding the order against it. The second was
the answer given to a proposition of this kind in Meadow Glen Home Owners
Association & others v City of Tshwane Metropolitan Municipality & another 2015 (2)
SA 413 (SCA) para 8, namely that:
„If there were a dispute between them and the appellants regarding the scope of the order
and what needed to be done to comply with it, it was not appropriate for the municipality to
wait until the appellants came to court complaining of non-compliance in contempt
proceedings. It should have taken the initiative and sought clarification from the court.‟

[22] It follows, in my view, that Tasima‟s charge of contempt had been established
against RTMC as well. The position of RTMC‟s Chief Executive Officer, Mr Msibi,
against whom Tasima also sought a committal order, is somewhat different. In the
first place, no order of mandamus was directed against him personally (cf City of
Johannesburg Metropolitan Municipality v Hlophe [2015] 2 All SA 251 (SCA) paras
15-22). What is more, he only joined RTMC in December 2013 and Tasima itself
contended in its replying affidavit that Mr Msibi had „no personal knowledge of any
facts pertaining to Tasima‟. In these circumstances I do not believe that the contempt
charge against him was established beyond reasonable doubt. On the other hand
Tasima had made out a case against him, on a balance of probabilities, which is
sufficient for the interdictory relief it also sought against him.

[23] That brings me to the related relief sought by Tasima, namely for an order that
the respondents should be interdicted from transferring the eNaTIS except in terms
of schedule 15 to the turnkey agreement and that the Department and its officials
should be directed, in essence, to comply with the terms of the turnkey agreement
read with schedule 15. This relief, as I see it, was likewise unconnected to the
outcome of the Department‟s counter-application for the setting aside of the
extension of the contract sought by Tasima on the basis of the court orders in its

favour and not on the contract itself. The fact that the court orders were in turn
founded on the extended contract period, does not detract from this principle. This, I
believe, also answers the Department‟s alternative argument based on the private
law principle which finds expression in the maxim ex turpi causa non oritur action
(from a dishonourable cause an action does not arise). According to this argument
the Department could rely on the defence in private law that it is not bound to
perform an illegal contract. But, as I have said, Tasima is not seeking to compel
performance of a contract. It is seeking performance of court orders in its favour.
Hence the illegality or otherwise of the contract is of no consequence as long as the
orders stand.

The counter-application for review
[24] I now turn to the Department‟s counter-application for the review and setting
aside of Mr Mahlalela‟s decision in May 2010, to extend the period of the turnkey
contract until 30 April 2015. In support of this application the Department placed
substantial reliance on the judgment of this court in Minister of Transport NO &
another v Prodiba (Pty) Ltd [2015] 2 All SA 387 (SCA). In Prodiba a decision by the
same Mr Mahlalela in his capacity as Director-General of the Department to extend
another contract for five years, was set aside by this court at the behest of the
Department in a counter-application. A cardinal difference between the two cases is,
however, introduced by the substantial delay factor in this case, which was absent in
Prodiba. The impugned decision in this case, as we know, was taken in May 2010.
This means that nearly five years had elapsed before the institution of the
Department‟s review application. Since the review application had been brought
under s 6 of PAJA it is, at least on the face of it, subject to the time-bar in s 7. In
terms of this section proceedings for judicial review in terms of s 6 must be instituted
without unreasonable delay and not later than 180 days, unless the court in terms of
s 9 allows an extension „where the interests of justice so requires‟.

[25] The Department‟s first bid to circumvent the obstacle created by the s 7 time-
bar was that its counter-application amounted to what has become known in
administrative law parlance as a collateral or defensive challenge. Underlying this
argument is the principle that a collateral challenge enjoys a somewhat distinct
status in our administrative law that renders it immune to limitations of time (see eg

Kouga Municipality v Bellingan & others 2012 (2) SA 95 (SCA) para 18; MEC for
Health, Eastern Cape & another v Kirland Investments (Pty) Ltd 2014 (3) SA 481
(CC) para 83). The concept of a collateral challenge has its origin in Oudekraal
Estates (Pty) Ltd v City of Cape Town & others 2004 (6) SA 222 (SCA). According to
the general principle laid down by this court in Oudekraal (para 26) administrative
actions must be treated as valid until set aside, even if actually invalid. But at the
same time it recognises the following exception to this general rule (para 32):
„It is in those cases – where the subject is sought to be coerced by a public authority into
compliance with an unlawful administrative act – that the subject may be entitled to ignore
the unlawful act with impunity and justify his conduct by raising what has come to be known
as a “defensive” or a “collateral” challenge to the validity of the administrative act.‟ (Footnote
omitted.)

[26] The first difficulty which confronted the Department in its reliance on the
concept of a collateral challenge was that there are two recent decisions of this court
which held that this defence is not available to organs of State (see Kwa Sani
Municipality v Underberg/Himeville Community Watch Association & another [2015]
2 All SA 657 (SCA); Merafong City Local Municipality v AngloGold Ashanti Ltd [2015]
ZASCA 85 (SCA). The Department urged us to find that these cases were wrongly
decided for two reasons. First, because they tie up the courts in a doctrinal
straitjacket, and secondly, because they are in conflict with the reasoning reflected in
the minority judgment of the Constitutional Court per Zondo J (Mogoeng CJ, Jafta
and Nkabinde JJ concurring) in Head of Department, Department of Education, Free
State Province v Welkom High School & another 2014 (2) SA 228 (CC) para 262.

[27] I do not think that the recognition of a principle that a collateral challenge is
not available to organs of State constitutes an unwarranted doctrinal restriction to the
courts‟ review jurisdiction. The sole reason why the Department seeks to rely on a
collateral challenge in this case is because it wants to avoid the consequences of the
180-day time-bar in s 7 of PAJA. But the time-bar in s 7 itself is not absolute. It can
be extended or condoned by the court in terms of s 9 if the interests of justice so
dictate. The Constitutional Court‟s minority judgment in the Welkom High School
relied upon by the Department has, in my view, been overtaken by the later
judgment by a majority of that court in Kirland Investments where the reasons for

excluding organs of State from reliance on a collateral challenge was succinctly
formulated thus by Cameron J (paras 82-83):
„PAJA requires that the government respondents should have applied to set aside the
approval, by way of formal counter-application. They must do the same even if PAJA does
not apply. To demand this of government is not to stymie it by forcing upon it a senseless
formality. It is to insist on due process, from which there is no reason to exempt government.
On the contrary, there is a higher duty on the state to respect the law, to fulfil procedural
requirements and to tread respectfully when dealing with rights. Government is not an
indigent or bewildered litigant, adrift on a sea of litigious uncertainty, to whom the courts
must extend a procedure-circumventing lifeline. It is the Constitution's primary agent. It must
do right, and it must do it properly.
Counsel for the department told this court, as he told the Supreme Court of Appeal, that, if
the department had to bring a counter-application under PAJA, it would face the PAJA 180-
day rule. Well, precisely. An explanation for the delay is a strong reason for requiring a
counter-application. . . .‟ (Footnotes omitted.)

[28] This brings me to the Department‟s alternative contention that the court a quo
extended the 180-day period in the exercise of its discretion and in a manner that
does not warrant intervention by a court of appeal. On my reading of the court a
quo‟s judgment I do not believe, however, that it purported to exercise any discretion
in terms of s 9 at all. I say that because of the following remark in the judgment (para
99):
„I therefore exercise my discretion and permit the collateral challenge of the validity of the
agreement.‟
The point is, of course, that if the court permitted the counter-application on the basis
of a collateral challenge, it would have no discretion to disallow that application at all
(see eg Kouga para 18). Even if it were to be assumed that the discretion afforded
by s 9 is a discretion in the strict sense, as opposed to a value judgment – an
assumption which is in my view open to serious doubt – we would in any event be
entitled to intervene on the basis that the court a quo did not exercise its discretion at
all (see eg Oakdene Square Properties (Pty) Ltd & others v Farm Bothasfontein
(Kyalami)(Pty) Ltd & others 2013 (4) SA 539 (SCA) paras 18-20.

[29] In considering whether we should extend the 180-day period to five years, it
must be borne in mind that the delay rule performs a vital function in administrative

law. Its purpose was explained as follows by Nugent JA in Gqwetha v Transkei
Development Corporation Ltd & others 2006 (2) SA 603 (SCA) paras 22-23:
„It is important for the efficient functioning of public bodies . . . that a challenge to the validity
of their decisions by proceedings for judicial review should be initiated without undue delay.
The rationale for that longstanding rule . . . is twofold: First, the failure to bring a review
within a reasonable time may cause prejudice to the respondent. Secondly, and in my view
more importantly, there is a public interest element in the finality of administrative decisions
and the exercise of administrative functions . . .
Underlying that latter aspect of the rationale is the inherent potential for prejudice, both to the
efficient functioning of the public body and to those who rely upon its decisions, if the validity
of its decisions remains uncertain. It is for that reason in particular that proof of actual
prejudice to the respondent is not a precondition for refusing to entertain review proceedings
by reason of undue delay . . .‟

[30] Furthermore, as was explained by this court in Opposition to Urban Tolling
Alliance & others v South African National Road Agency Ltd & others [2013] 4 All SA
639 (SCA) para 26, the import of s 7 of PAJA is that after the 180-day period, a court
is only empowered to entertain the review application if the interests of justice
require an extension under s 9. Absent such extension, the court has no authority to
consider the review application at all. Whether or not the decision was in fact
unlawful no longer matters. The decision would, as it were, be „validated‟ by the
delay. It follows that an extension of a condonation of the delay has important
consequences and is not merely for the asking. On the contrary, the Constitutional
Court expressed itself as follows in this regard in Van Wyk v Unitas Hospital &
another 2008 (2) SA 472 (CC) para 22:
„An applicant for condonation must give a full explanation for the delay. In addition, the
explanation must cover the entire period of delay. And, what is more, the explanation given
must be reasonable.‟

[31] In this case it is clear that the Department became aware of the alleged
grounds of invalidity of the 2010 extension shortly after Mahlalela‟s impugned
decision to that effect had been taken. Since then the Department had been advised
by the State Attorney and various counsel, senior and junior, on numerous occasions
about the legal basis on which the decision could be challenged. It sought to explain
away the delay by stating that, although Mr Letsoalo wished to challenge the

extension, Mr Mahlalela stood in his way of doing so. But it appears that Mr
Mahlalela was the deponent to the Department‟s answering affidavit where he
expressly challenged the validity of his own decision to extend the contract period
before Mabuse J and that he did the same in the subsequent petition to this court. It
therefore cannot be credible that, simultaneously with challenging the extension, Mr
Mr Mahlalela was taking steps to prevent that same challenge. Moreover, Mr
Mahlalela‟s contract as Director-General expired on 28 February 2013. After this
date there was therefore no impediment to the institution of review proceedings.
What is more, in Prodiba the Department brought a counter-application for review in
circumstances substantially similar to those of this case. There is therefore no
explanation whatsoever for the additional two year delay since 2013 before the
counter-application was brought in March 2015. This is in stark contrast with the
requirement formulated in Unitas Hospital that the explanation must cover the entire
period of delay.

[32] A separate contention raised by the Department as to why the five year delay
should be condoned, rested on allegations of fraud and corruption. The factual basis
relied upon for this contention, was this: After Mr Mahlalela vacated his position as
Director-General in February 2013, so Mr Letsoalo testified, he immediately opened
a criminal charge against him. Mr Letsoalo also appointed a forensic firm to
investigate the extension of the contract and reported the matter to the Special
Investigation Unit (the SIU) established in terms of the Special Investigation Units
and Special Tribunals Act 74 of 1996.

[33] An affidavit on behalf of the SIU records its finding that an entity, Brand
Partners (Pty) Ltd, in which one Mr Ncube was a director, entered into a consultancy
agreement with Tasima to provide consultancy services relating to eNaTIS for a
monthly fee of R2 million, irrespective of whether any services were performed or
not. The contract between Brand Partners and Tasima had as one of its conditions
precedent that the eNaTIS contract be extended for a period in excess of 18 months
before 30 June 2013. Mahlalela went on to extend the contract on 12 May 2010 (ie
before 30 June 2013). Subsequently Mahlalela signed a residential lease agreement
to lease the house owned by Mr Ncube of Brand Partners. The rental was stated to

have been R45 000 per month. But he did not pay any deposit nor did he pay any
rental between 1 November 2010 and 30 November 2011.

[34] As appears from the formulation of the Department‟s review grounds to which
I have referred earlier, fraud was never one of them. On the contrary, these grounds
were confined to Mahlalela‟s failure to apply a competitive bidding process as
required by s 217 of the Constitution, the PFMA and other statutory enactments. The
allegations of fraud and corruption were advanced in the Department‟s answering
affidavit, not under the heading „the illegality of the extension‟ but under the rubric
„the delay in reviewing Mahlalela‟s decision‟. In this context of explaining the delay,
these allegations of fraud and corruption were put forward in support of the thesis
that it was Mahlalela who stymied any challenge to the unlawful extension at an
earlier stage.

[35] When this was raised with the Department‟s counsel in argument, the
response was that this court should not be deterred from considering serious
allegations of fraud merely because they were advanced under the „wrong heading‟.
As I see it, however, the response is over-simplistic. Tasima did not respond to these
allegations of fraud and corruption at all. It contested the proposition that Mahlalela
was to blame for the Department‟s inaction in another way, namely, by pointing out
that Mahlalela deposed to the Department‟s opposing affidavit in the application
before Mabuse J; that he also deposed to the affidavit supporting the application for
leave to appeal to this court; and that, in any event, he ceased to be the Director-
General in February 2013. In these circumstances Tasima‟s failure to deal with the
allegations of fraud and corruption does not justify the inference that it is unable to
do so, nor can it be regarded as an implied admission that these allegations are true.
To elevate these allegations to a level where they are deployed as an independent
(and in fact sole) reason for extending the 180-day time limit would severely
prejudice Tasima.

[36] Furthermore, the Department‟s contention that a 180-day time limit must be
extended on the basis of allegations of fraud, even though these allegations may not
be relied upon as a basis for setting the impugned decision aside, defies logic. Why
would the review door be opened to the Department on the basis of fraud which

would then become irrelevant in the review itself because the Department does not
rely upon it as a review ground? It also begs the obvious question: why is the
Department so reluctant to rely on these allegations as a basis to challenge the
impugned decision? The only reason I can think of is that the Department has little, if
any, confidence in its ability to establish these allegations if they were to be properly
challenged in a court of law.

[37] Conversely, if the Department wants to rely on fraud to set the impugned
decisions aside, why has it not yet done so? Mr Letsoalo must have been aware of
the allegations since at least 2013, otherwise he could hardly have substantiated
criminal charges against Mr Mahlalela, nor could he be able to justify the
appointment of a forensic firm or make a report to the SIU at that stage. If this is so,
why did he not raise these allegations in answer to the five contempt applications
that Tasima has brought since then? Why did the Department allow the contract to
run for another two years with the possibility of a further extension under schedule
15? Why did it not simply cancel the turnkey agreement and apply for the setting
aside of the Mabuse J order on the basis of fraud? Simply stated, I do not believe we
would be justified to extend the 180-day time limit on the basis of allegations of fraud
which (a) may play no further part in the review proceedings and (b) had been known
to the Department for more than two years prior to the application. After all, if the
Department believes that it is in a position to establish the serious allegations of
fraud and corruption obliquely referred to, there would be nothing preventing it to
cancel the turnkey agreement and to seek the setting aside of the Mabuse J order on
that basis at any time in the future. Questions of res iudicata do not arise, because
the allegations of fraud and corruption have never been pleaded as a cause of action
nor decided upon.

[38] The Department‟s final argument was that the closure of the review door on
its case would result in an unlawful contract, which might have been induced by
fraud, being extended for another five years. But, as I see it, there is more than one
answer to this argument. First, if the Department had failed to make out a case for
extension of the 180-day limitation, as in my view it did, the extension became
„validated‟ through delay. Whether or not it was in fact unlawful no longer matters.
Secondly, the fact that it may have resulted from fraud, is not part of the

Department‟s cause of action. If the Department wants to rely on that cause of
action, there is nothing that prevents it from doing so. Thirdly, there is no reason why
the transfer of the eNaTIS under schedule 15 should take 5 years. On the
Department‟s own version it should take no more than 12 months and may even be
completed in four months.

[39] For these reasons I believe that there is no basis for extending the 180-day
time limit imposed by s 7(1) of PAJA and that the court a quo was therefore
precluded from entertaining the counter-application to review and set the impugned
extension decision aside. It follows that, in my view, the appeal against both the
dismissal of the main application and the order upholding the counter-application,
must succeed with costs.

[40] It is ordered that:
(a) The appeal against both the dismissal of the main application and the order
granted in terms of the counter-application is upheld with costs, including the costs of
two counsel, against the first and fifth respondents, jointly and severally.
(b) The order of the court a quo is set aside and replaced with the following:
„An order is issued in the following terms:
1.
Declaring:
(a)
the first and second respondents to be in breach and contempt of:
(i)
paragraph 1.1 of the order of this court issued under case number
44095/2012, handed down by Mabuse J on 17 October 2012 (the Mabuse
Order);
(ii)
paragraph 3 of the order of this court issued under case number 44095/2012
handed down by Strijdom AJ on 26 March 2013 (the Strijdom Order);
(iii) paragraphs 5 and 6 of the order of this court issued under case number
44095/2012 handed down by Fabricius J on 27 August 2013 (the Fabricius
Order);
(iv) paragraph 1 of the order of this court issued under case number 44095/2012
handed down by Rabie J on 21 January 2014 (the Rabie Order);
(b)
the fifth and eleventh respondents to be in breach and contempt of:
(i)
paragraphs 5 and 6 of the Fabricius Order; and
(c)
the tenth respondent to be in breach and contempt of:

(i)
paragraph 1.1 of the Mabuse Order;
(ii)
paragraph 3 of the Strijdom Order;
(iii) paragraphs 5 and 6 of the Fabricius Order;
(iv) paragraph 4.1 of the order of this court issued under case number
44095/2012 handed down by Nkosi J on 5 November 2013 (the Nkosi
Order);
(v)
paragraph 1 of the Rabie Order;
2.
Ordering that:
(a)
no transfer of the eNaTIS and the services (as defined in the turnkey
agreement for the provision of the eNaTIS system (Contract RT1194KA) dated
3 December 2001, as subsequently amended and extended ( the turnkey
agreement) may take place except in terms of the transfer management plan
envisaged in schedule 15 to the turnkey agreement;
(b)
for the duration of the transfer of the eNaTIS and the services:
(i)
the applicant is to be paid, by the first respondent, for all services rendered
under the agreement, in accordance with, inter alia, the terms of the turnkey
agreement and paragraph 1.2 of the Mabuse Order;
(ii)
all purchase requisition orders are to be processed in accordance with, inter
alia, the terms of the turnkey agreement and paragraph 4 of the Nkosi Order;
and
(iii) all material contracts and agreements required to be approved by the first
respondent will be so approved within five days of the request by the
applicant;
(c)
the first, second, fifth, tenth and eleventh respondents are interdicted from
taking any steps to implement the purported transfer alluded to in the letters
dated 24 February 2015, 25 February 2015 and 4 March 2015 (the transfer
correspondence, which respectively comprise annexes FM27, FM25, and FM28
to the supporting affidavit of Fannie Lynen Mahlangu dated 12 March 2015), or
to implement any transfer of the eNaTIS, the services (as defined in the turnkey
agreement) or any related services contrary to 2.1 above;
(d)
the fifth respondent is to desist from advertising for any eNaTIS related
positions until at least a transfer management plan has been finalised in terms
of the turnkey agreement;
3.
Ordering that:

(a)
the second and tenth respondents be committed to imprisonment for a period of
30 days.
(b)
the order in paragraph 3(a) above will not come into operations unless there is
a breach of the order in paragraph 2(c) above;
(c)  a warrant of committal is to be issued by this court on the same papers, duly
supplemented as necessary, if the first, second and tenth respondents breach
the order in paragraph 2(c) above;
4.
Ordering the first and fifth respondents, jointly and severally, to pay the
applicant‟s costs of the application dated 12 March 2015, including the costs
of two counsel.
5(a)
Dismissing the first respondent‟s counter-application dated 26 March 2015;
(b)
Ordering the first respondent to pay the applicant‟s costs of the counter-

application, including the costs of two counsel.

______________________
F D J BRAND
JUDGE OF APPEAL

APPEARANCES:

For the Appellant:

A E Franklin SC, J P V McNally SC, A W T Rowan
Instructed by:
Weber Wentzel
Johannesburg
c/o Symington & De Kok, Bloemfontein

For the first, second, third,
sixth and tenth Respondent:
D Unterhalter SC, M du Plessis, J A Motepe
Instructed by:
State Attorney, Pretoria
c/o State Attorney, Bloemfontein

For the fifth and eleventh
Respondent:

G J Marcus SC, F B Pelser, L N Luthuli
Instructed by:
Seleke Attorneys, Johannesburg
c/o Bezuidenhouts Inc, Bloemfontein