The document discusses several cases related to objections, complaints, and appeals by unsuccessful bidders in South African municipal tender processes. It summarizes key principles from cases such as Groenewald v M5 Developments, which found that unsuccessful bidders have a right to appeal under Section 62 of the Municipal Systems Act. However, the appeal authority cannot revisit all tenders or award a tender to a bidder who did not appeal. The document also discusses differences between Section 62 appeals and objections/complaints processes under Regulations 49 and 50, noting Section 62 establishes an internal remedy while objections/complaints do not.

1. OBJECTIONS,
COMPLAINTS &
INTERNAL
APPEALS BY
UNSUCCESSFUL
BIDDERS

2. Section 62
• 1) A person whose rights are affected by a decision taken …. in
terms of a power or duty delegated or sub-delegated by a
delegating authority …… may appeal against that decision by
giving written notice of the appeal and reasons to the municipal
manager within 21 days of the date of the notification of the
decision.
• (2) ……
• (3) The appeal authority must consider the appeal, and confirm,
vary or revoke the decision, but no such variation or revocation of
a decision may detract from any rights that may have accrued
as a result of the decision.
• (4) When the appeal is against a decision taken by–
• (a) a staff member other than the municipal manager, the
municipal manager is the appeal authority.

3. CC Groenewald v M5 Developments
• Brief facts:
o municipality invited tenders for the appointment of an
"implementation agent" for housing projects
o BAC award bid to M5
o M5 informed successful and
o 4 bidders were informed they were unsuccessful and
given 21 days to appeal in terms of section 62.
o ASLA and Blue Whale lodge appeals
o Only Blue Whale’s appeal was lodge on time
o MM was appeal authority and only considered Blue
Whale’s appeal
o MM as appeal authority of the view that ASLA out of time
and Blue Whale’s appeal had no merits

4. CC Groenewald v M5 Developments
• Brief facts continue…
o MM –
• Re-evaluated the tenders submitted. He
concluded that both the consulting engineers and
the BEC had incorrectly scored the tenders.
• approached M5 and ASLA requesting the
provision of further information
• ASLA responded on time but M5 did not respond
• Based upon the new information received from
ASLA the MM recalculated the points scored and
decided that the tender should not have been
awarded to M5 but to ASLA
• M5 took matter to WC HC and was successful
• Mun and ASLA appeal to SCA

5. CC Groenewald v M5 Developments
• M5 argued that an unsuccessful bidder has no right
to appeal under Section 62 based of CoCT v
Reader
• SCA - unsuccessful bidders were all parties to the
tender approval process and hence had a right to
appeal under Section 62.

6. CC Groenewald v M5 Developments
• SCA-
o Whether the MM as appeal authority, was
entitled to award the tender to an unsuccessful
bidder who was not a party to the appeal.
o Appeal under S62 is a "wide appeal" involving a
re-hearing of the issues, but
o held that S 62 does not allow the appeal
authority to revisit all the tenders and to award
the tender to an unsuccessful bidder who did not
appeal or, as in this case, whose appeal was out
of time.

7. CC Groenewald v M5 Developments
• SCA-
o Once the municipal manager was of the
view that Blue Whale's appeal was
without merit and having dismissed ASLA's
appeal, the only course of action was to
dismiss Blue Whale's appeal.
o MM was not entitled to re-evaluate and
re-allocate the tender as he did.

8. CC Groenewald v M5 Developments
• SCA-
o Appellants argue that should the court find that
the MM had no power to award the contract to
ASLA, the court should refer the matter back to
the BAC for reconsideration
o MM as appeal authority, had the power under
S62(3) to "consider the appeal, and confirm, vary
or revoke the decision“
o MM had no power to refer the matter back to
the BAC for reconsideration. This being so, the
court is also not in a position to make an order on
review that the MM could not have made.

9. Accrual of rights under Section 62(3)
Loghdey v Advanced Parking Solutions CC
• BAC awarded a tender to Loghdey for a kerbside
parking management service and soon after a
formal contract was concluded.
• Advanced Parking Solutions, an unsuccessful
bidder, appealed against the award, relying on S62
• Loghdey approached the court for an order that
no appeal was available.

10. Loghdey v Advanced Parking Solutions CC
• Advanced Parking Solutions countered that the
municipality's tender invitation made the award of
the contract subject to a 21-day appeal period
and that the municipality's own supply chain
management policy stipulated that tender awards
may only be made once any appeals have been
satisfactorily resolved

11. Loghdey v Advanced Parking Solutions CC
• The court found in favour of Loghdey.
• It held that even though the bid conditions and the
municipality's supply chain management policy
both made provision for an appeal process, they
did not provide for a right of appeal.
• Simply created an obligation that participating
bidders be informed of their right to appeal a
tender award.

12. Loghdey v Advanced Parking Solutions CC
• Neither the notification of the tender award to
Loghdey nor the formal contract concluded with it
made the award or the conclusion of the contract
conditional upon an appeal period, unconditional
rights vested in Loghdey following the award of the
tender and the conclusion of the contract.

13. • The court distinguished the case judgment in Syntell
(Pty) Ltd v The City of Cape Town
• Facts in Syntell were very similar, the primary
difference was that the notification of the tender
award in Syntell expressly stated that the award was
subject to a 21-day appeal period, and that no
rights would accrue before the expiry of that
period.
• In the case at hand, the court held, the notification
contained no such statement.
Loghdey v Advanced Parking
Solutions CC

14. Lohan Civil-Tebogo Joint Venture v
Mangaung Plaaslike Munisipaliteit
• Lohan felt aggrieved by the award of the tender to
Moeletsi and approached the court for an interim
interdict to
o prevent the execution of the tender pending the finalisation of a review
application
o setting aside the award of the tender and contract
The municipality, raised a preliminary point.
- Section 7(2)(a) of PAJA, a review application cannot succeed unless
the court is satisfied that an applicant has exhausted internal remedies
available to it.

15. Lohan Civil-Tebogo Joint Venture v
Mangaung Plaaslike Munisipaliteit
• The court held that on the language of Section 62(1), it is
clear that it envisages an appeal against a decision that
was taken pursuant to a delegation of authority.
• In the present case, the decision to award the tender to
Moeletsi was ratified by the MM who was not exercising
a delegated power, but an original power.
• In terms of Regulation 29(5)(b)(i) of the Supply Chain
Regulations, the MMof the municipality has the final
power of approval read with Section 60 of the MFMA,
which describes the MM as "accounting officer"

16. Lohan Civil-Tebogo Joint Venture v
Mangaung Plaaslike Munisipaliteit
• Appeal to MM where he took the decision. Logic
dictates that this is not at all an effective remedy.
• An appeal under Section 62 of the Municipal
Systems Act was, accordingly, not available to
Lohan.
• This court decision taken in February 2009 Manana v
King Sabata Dalindyebo Municipality was decided
in November 2010

17. Manana v King Sabata
Dalindyebo Municipality
• “14. As is to be expected, the Act is replete with
provisions recognising that executive authority vests
in the council and in nobody else.
• Indeed, ordinary legislation is not constitutionally
capable of divesting a municipal council of its
executive authority – or any part of it and the
construction of a statute that would produce that
result must be avoided if it is possible to do so
• Q does Lohan still apply after Manana

18. Regulation 49
Objections and complaints
• The supply chain management policy
–
o must allow persons aggrieved by decisions or actions taken
by the municipality or municipal entity in the
implementation of its supply chain management system, to
lodge within 14 days of the decision or action a written
objection or complaint to the municipality or municipal
entity against the decision or action.

19. Regulation 50
Resolution of disputes, objections, complaints and queries
• 50. (1) The supply chain management policy of a municipality
or municipal entity must provide for the appointment by the
accounting officer of an independent and impartial person
not directly involved in the supply chain management
processes of the municipality
• - (a) to assist in the resolution of disputes between the
municipality or municipal entity and other persons regarding-
o (i) any decisions or actions taken by the municipality or municipal entity in the
implementation of its supply chain management system; or
o (ii) any matter arising from a contract awarded in the course of its supply chain
management system; or
(b) to deal with objections, complaints or
queries regarding any such decisions or actions
or any matters arising from such contract.

20. Regulation 50
Resolution of disputes, objections, complaints and queries
4. The person appointed must –
o (a) strive to resolve promptly all disputes, objections, complaints or queries
received; and
o (b) submit monthly reports to the accounting officer on all disputes,
objections, complaints or queries received, attended to or resolved.
7. This regulation must not be read as affecting a
person’s rights to approach a court at any time.

21. Objections and
complaints
• In the light of the above provisions
o "independent and impartial",
o not be "directly involved in the SCM processes“
It stands to reason that even though the MM (or an
official designated by him or her) is required to
"assist" the person appointed to ensure the
effective performance or his or her functions, it is
not permissible for the MM to perform the functions
himself or herself.

22. Objection & complaints v
S62 Appeals
• Section 62 qualifies as an internal remedy for the
purposes of Section 7(2) of PAJA,
• whereas 49 & 50 do not give rise to an internal
remedy as referred to in Section 7(2) of PAJA.

23. Objection & complaints v
S62
• Muni’s could effectively prevent S62 from having any
application to their tender awards by making
unconditional awards and/or concluding unconditional
contracts.
• with the result that rights will have accrued to the
preferred bidder, which cannot be disturbed by an appeal
under Section 62.

24. Objection & complaints v
S62
• Q, is whether municipalities are or should be under an
obligation or duty bound to make tender awards
conditional on a 21-day period, allowing unsuccessful
bidders to appeal against the award decision.
• S62 is a general appeal provision and not strictly
confined to municipal tender processes, municipalities
are not duty bound to make conditional awards
• SCM Regs, on the other hand, make clear that muni’s
"must" make provision in their supply chain management
policies for the lodging of "complaints and objections"
within a 14-day

25. EVALUATIONS ENHANCED PROPERTY v THE BUFFALO CITY
• Applicant were verbally informed that the tender
had been awarded to another bidder
• Applicant argued
o s62 requires “notification” of the decision. And having regard to the
importance of the right to fair administrative action conferred on
Applicant by section 33 of the Constitution, informal or verbal notification
is insufficient and it is a constitutional prerogative that the “notification”
must be in writing.
o Second, s62(1) requires the Applicant to lodge the notice of appeal and
written reasons for the appeal within 21 days of the “notification.”

26. EVALUATIONS ENHANCED PROPERTY v THE BUFFALO CITY
• “35] It follows that having regard to all the usual and
well-known rules and tenets of interpretation,
including the object and purpose of these
enactments, PAJA, PAIA and all other similar
statutes must be interpreted like any other statute
and subject to the Constitution. Where it falls short
of the Constitution, or offends a constitutional right,
that part of the statute may be struck down as
unconstitutional. It also follows that the provisions of
• PAJA and PAIA cannot simply be ignored, qualified
or interpreted beyond recognition of the clear
grammatical meaning of the words used in the
text.”

27. EVALUATIONS ENHANCED PROPERTY v THE BUFFALO CITY
• Neither section 33 of the Constitution which creates
the right to fair administrative action, nor the
provisions of PAJA, prescribe by whom, when and in
what manner the notification of the decision must
be given
• both sections 5 and 7 of PAJA follow the source of
the right contained in section 33 of the Constitution
by repeating the requirement of written reasons for
the decision, but not being prescriptive at all in
regard to the manner of notification of the decision
or that reasons must be given simultaneously with
the decision.

28. EVALUATIONS ENHANCED PROPERTY v THE BUFFALO CITY
• It is clear from sections 5(1) and 7(1) that such
notification may reach the affected person in any
manner and from whomever, not necessarily from the
decision maker.
• It goes even further: the right to receive written reasons
under section 33(2) of the Constitution is dependent
upon the affected person requesting reasons
• Its Applicant’s own version, that it was notified of the
decision on 21 August 2012 having been told by a senior
Municipal Officer
• Court: these events constituted “notification” as
envisaged by section 62(1) of the Systems Act read with
section 5(1) of PAJA.

29. Objection & complaints v
S62
• legislature is not clear on the extent of the powers
of the independent and impartial third party
• However courts have recently frown on muni’s that
disregard the SCM legislation… even indicating that
they will hold municipal officials personally liable

30. Case list
• CC Groenewald v M5 Developments (283/09) [2010] ZASCA 47 31 March 2010
• Koyabe v Minister for Home Affairs Case CCT 53/08 [2009] ZACC 23 25 August 2009
• Loghdey v Advanced Parking Solutions CC Case 20766/2008 (W) [2009] ZAWCHC 15
25 February 2009
• Lohan Civil-Tebogo Joint Venture v Mangaung Plaaslike Munisipaliteit Case 508/2009
(O) [2009] ZAFSHC 21 27 February 2009 (unreported)
• M5 Developments (Cape) (Pty) Ltd v CC Groenewald NO Case 6277/08 [2009]
ZAWCHC 3 12 February 2009
• Mohammed Zunade Loghdey v City of Cape Town; Advanced Parking Solutions CC v
City of Cape Town Case 100/09 [2010] ZAWCHC 25 20 January 2010
• Moseme Road Construction CC v King Civil Engineering Contractors (Pty) Ltd
(385/2009) [2010] ZASCA 13 15 March 2010
• Municipality of the City of Cape Town v Reader 2009 1 SA 555 (SCA)
• Nichol v Registrar of Pension Funds 2008 1 SA 383 (SCA)
• Oudekraal Estates (Pty) Ltd v City of Cape Town 2004 6 SA 222
• Reader v Ikin 2008 2 SA 582 (CPD)
• Reed v Master of the High Court of South Africa [2005] 2 All SA 429 (E)
• Robcon Civils/Sinawamandla 2 Joint Venture v Kouga Municipality 2010 3 SA 241
(ECP)
• Syntell (Pty) Ltd v The City of Cape Town Case 17780/07 (CPD) [2008] ZAWCHC 120 13
March 2008 (unreported)
• Total Computer Services (Pty) Ltd v Municipal Manager, Potchefstroom Local
Municipality 2008 4 SA 346 (T)
• Manana v King Sabata Dalindyebo Municipality (345/09) [2010] ZASCA 144 (25
NOVEMBER 2010)