Supreme Court dismisses road tender appeal

SWAKOPMUND

24 August 2017 | Justice

Jessica Botes

An appeal submitted to the Supreme Court by an unsuccessful tenderer in the N$990 million tender for the construction of the freeway between Swakopmund and Walvis Bay has been dismissed.

Acting judge of appeal Theo Frank found in his judgement that the High Court should have concluded that the award of the tender to the third respondent (Unik Construction Engineering Namibia, and its Namibian joint-venture partner, Thohi Construction) was invalid, as a fair process was not followed. In spite of this, Frank did not overturn the High Court’s decision because the project has been proceeding for more than a year and the probable consequences involved in substituting Unik with another bidder will not be just and equitable.

In his judgement in the High Court, acting judge Collins Parker found that the court would be overstretching without justification, its power to control the administrative decision making of the Roads Authority (RA) if it were to interfere with its decision to award the tender to Unik.

Parker found that the RA’ decision not to award the tender to the appellant, China Henan International Cooperation Group (Chico) and its Namibian joint venture partner Octagon Construction, was fully justified.

The RA’s Technical Evaluation Committee (TEC) evaluated all the tenders which qualified. The TEC made recommendations to the RA’s Board Tender Committee (BTC) to award tender to Chico. The BTC however, rejected the recommendations and awarded the tender to Unik.

Chico claimed that there is no justification for the acceptance of Unik’s tender which is almost N$67 million more expensive than its own tender bid. The applicant claimed there is no reason why the state should bear such a huge price difference, when there are no compelling considerations such as preference point systems to justify the huge additional cost to the state.

The applicant further asked the court not to remit the tender to the board tender committee for reconsideration, but to award them the tender.

In his judgement, Frank however found that neither Chico nor Unik was involved in any improper conduct in respect of their bids or in relation to the process leading up to the award of the tender to Unik.

“There is thus no culpable conduct on the part of either of them. They put in their bids and awaited the outcome of the process. The nature of the impugned acts by the Board do not involve serious misdemeanours such as fraud, bias or improper purpose but can rather be typified as administrative missteps,” said Frank.

He also found that Chico’s tender was a compliant one and was determined to be the ‘preferred bidder’.

“Even assuming that appellant is still prepared to execute the tender, a year later and only in respect of the balance of the work that still must be performed, one simply does not know what the impact of this would be on the project and the pricing. In these circumstances it would not be correct to simply substitute the appellant for third respondent. Appellant has thus not provided the court with sufficient reasons to deviate from the default remedy,” said Frank.

He ordered that the appellant was substantially successful and respondents should pay the costs. A different cost order was however proposed by the two judges of appeal Elton Hoff and Sylvester Mainga who concurred with his judgement. They rather proposed that the RA and chairperson of the Board be ordered to pay the costs of the appellant.

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