Appellant losing tender in 2012 to construct Senate Building for Parliament for failure to meet tender specifications -tender not proceeded with and preferred tenderer not called to sign construction contract for almost five years – Tender cancelled but on challenge by one tenderer High Court directing that tender process must continue; Ministry in bona fide misunderstanding of court judgment ordering a re-evaluation of original tender and including appellant’s bid in new evaluation despite earlier disqualification and awarding contract to appellant;
On court clarifying its judgment Ministry revoking award to appellant; Appellant applying to High Court for award to be restored to it; Court dismissing application on grounds award to appellant granted in disregard of High Court judgment;
On appeal judgment of High Court upheld and appeal dismissed with costs
IN THE APPEAL COURT OF LESOTHO
HELD AT MASERU C OF A (CIV)/80/2019
In the matter between: CCA/0122/2018
QINGJIAN GROUP CO. LTD APPELLANT
PROCUREMENT UNIT 1ST RESPONDENT
PPAD 2ND RESPONDENT
MINISTRY OF PUBLIC WORKS
AND TRANSPORT 3RD RESPONDENT
PS MINISTRY OF PBLIC WORKS AND
TRANSPORT 4TH RESPONDENT
YAN JIAN CONSTRUCTION (PTY) LTD 5TH RESPONDENT
ATTORNEY GENERAL 6TH RESPONDENT
CORAM: DR KE MOSITO P
P T DAMASEB AJA,
M H CHINHENGO AJA
Enrolled: 15 May 2020
Delivered: 2 June 2020
2. The learned judge erred and misdirected himself in holding as he did that the Appellant won the bid as a result of a re-tender in as much as no re-tender was called.
3. The learned judge erred and misdirected himself in misinterpreting the judgment in CCA/0093/14 as he did to mean that the judgment precluded re-evaluation in as much as the judgment precluded re-tendering.
4. The learned judge misdirected himself in holding that the offer and acceptance by the appellant is of no consequence.”
(c) The decision of the 1st respondent to nominate the 6th respondent shall not be set aside for want of compliance with the law of contract and procedures outlined in the Public Procurement Regulations 2007.”
History of dispute
In light of the above analysis and consideration, we would like to propose that the tender for Yan Jian Group to the tune of M84 564 207.22 inclusive of VAT be considered for the award.”
4.2 In 2012, the applicant was not considered to be the preferred bidder; in essence the whole tender process was cancelled sometime in 2017. I attach hereto a letter of Regret from the 1st respondent and mark it “QJ1”. The said letter detailed the reasons for the cancellation being that the scope of work had increased.
4.3 It transpired that prior to the said cancellation, court proceedings in the case of CCA/0093/2014 ensued wherein a judgment was obtained the terms of which were that the above cancellation as per the letter of regret be revoked and the tender process be extended. Accordingly, in compliance to the said judgment, another letter eliciting the 3rd respondent’s decision to award the tender and complete the tender process was made thus quashing or revoking the initial letter “QJ1”. I attach the said letter and mark it “QJ3”.
“Letter of Regret
Re: Construction of new Senate for Parliament of Lesotho
Further to a tender you submitted on Wednesday 15th August 2012 for the above mentioned project, you are hereby regrettably notified that the project has been cancelled due to the fact that the scope of the project has been increased thus the estimate for it has changed as well as causing a variation value to be more than 15% of which the Procurement Regulations 2007 do not allow for the project to proceed.”
The above matter bears reference.
The Ministry of Public Works and Transport kindly request to revoke the letter we wrote to your company informing you of rejecting all tenders for proposed New Senate Building Tender. This is due to the fact that as the Ministry we had overlooked the May 2016 judgment of the commercial court (CCA/0093/2014) which is something which should not be countenanced. The court showed in CCA/0093/2014 that a tender process can legally be extended. In particular, the court was making reference to this tender in question.
We therefore have decided to award the tender and complete the tender process. The Ministry therefore apologises for inconvenience we may have caused. …”.
Re: Proposed Construction of New Senate Building for Parliament of Lesotho
This serves to inform you that you have been awarded the tender for the construction of the above mentioned works to the sum of M75 589 613.49 [… in words].
Since the project was tendered for on 15th August 2012, it was estimated that the construction period will be two years. This means that the rates were fixed for that two years. The tender is only being awarded 5 years later, therefore the Ministry applied an escalation factor to every bidder with a 1.4509 factor.
Please note that all matters concerning a contract will be considered after debriefing process which is 15 days from now in terms of clause 32 of the Public Procurement Regulations 2007. You will remain as the preferred bidder during a period of 15 days starting from the date of this letter within which to confirm your position to enter into a contract agreement. The period ends on 29th September 2017.
We trust you will find this in order and treat accordingly.”
On the basis of the foregoing we are instructed, as we hereby do, to strongly urge you the recipients hereof to expedite the outstanding matters in ensuring that our client is placed in a position where it can resume with the project per the award.
Kindly take notice that client is very reluctant to take this matter to the Courts of Law for intervention as yet, hence our humble request that the matter be resolved at this level.
Kindly note, however, that should no progress be visible within a space of a week from receipt hereof, client will be forced to proceed to the Court and will further claim all costs and expenses associated with the delay.”
Re: Proposed construction of New Senate for Parliament of Lesotho
Further to a tender you submitted on 15th August 2012 for the above mentioned project, you are herewith regrettably notified that your tender was not successful. Tender Panel of the Ministry has accepted Yan Jian Construction’s offer and is therefore the preferred bidder at the tender amount of M84 564 207.22 VAT inclusive.
You are also informed that the initial award has been revoked.
There will be a cooling off period of 15 days starting from the date of this letter within which you may object in writing to the contract being awarded to the preferred bidder.
Please note that debriefing can be arranged after receipt of a request from the unsuccessful tenderer which must take place not later than a month after the contract has been awarded and all unsuccessful tenders are informed.”
4. In terms of the above mentioned letter, it was a requirement that we object in writing to the contract being awarded to Yan Jian Construction, compliance thereto was made yet however to this day, no response was made to the objections raised. …”.
(c) the offer which was rendered to us and accepted by us, in terms of the law of contract and was no longer available to be made to any other bidder. The offer and acceptance marked the completion of the bidding process. The dictates of regulation 30(1) of the Public Procurement Regulations therefore applied to us.”
Ad para 7
Before answering the subparas in specifics, I wish to lay a brief background which led to the issuance of QJ8.
8.1 It is common cause that at the very inception of the tender, the applicant and others were disqualified for non-conformance with specifications of the tender Document. This was in 2013. They were disqualified because their attachments were not authenticated and translated as required by the Tender Document. I annex herewith such Tender Document which was an addendum and mark “MP1”.
8.2 The company by the name Yan Jian Construction [5th respondent] was recommended the preferred bidder, however it was never awarded the contract. This tender process was cancelled at some stage. Flash Construction, another tenderer, successfully challenged the tender cancellation. Everything remained at halt until 2017 when I assumed office.
8.3 In 2017, I commenced the project process. I learned that some firms including the applicant had been disqualified for failure to comply with the Tender Document “MP1”. I made a decision that such companies be given an opportunity to comply. I then ordered a re-evaluation of the tender process thereafter. The re-evaluation was done and the applicant was recommended. When all this was happening, this court had reviewed the decision to cancel the tender. In my bona fide understanding of the judgment, I thought I was complying until when the court clarified its judgment that what was envisaged in the judgment was that the tender process should proceed from where they were before cancellation. This means that in view of the decision in CCA/0093/14, we had no alternative but to revoke our offer to the applicant. I annex herewith such judgment and mark [it] “MP2”.
Judgment on appeal
 In this case what the applicant [Flash Construction (Pty) Ltd] sought to be reviewed was the calling for re-tender and it succeeded, which meant that the process of re-tender was held to be irregular and was nullified. It was during this process of re-tender that the applicant in this matter managed to sneak in and be re-evaluated, resulting in the award to it and the formation of the contract which it insists is being breached and seeks an order of specific performance.
 A proper understanding of the ruling in my view is that once the review had succeeded, both the second invitation to tender and the second evaluation report resulting in the award to applicant, must all fall away and be disregarded. They are all part and a result of a process which had been nullified by the court.
 This application [Flash Construction application] succeeded. It was as a result of the decision to re-tender that the applicant ended up with the award of the contract from which it had initially been disqualified. The re-tender was declared unlawful and therefore the applicant is left with nothing.
 Consequently, the application cannot succeed and it is dismissed with costs.”
What this means is that the appellant, subject to pre-qualification review stipulated above, was in essence eligible for tendering. It goes without saying then that appellant’s disqualification would fatally be founded by non-compliance hereto and such has not been the case here. The appellant remained eligible for tendering.
In the event that the bidder is not disqualified for want of eligibility to tender, and has conformed to deadline for submission, then such bidder qualifies for evaluation – a totally different process from tendering.
It is worth mention (sic) that after the submission of tenders, tenderers may, prior to the process of evaluation, submit additional information or clarifications of tender documents upon request by the unit. See regulation 23.
This then clarifies the submission of the appellant’s certification letter from the Embassy to comply with the Addendum. Even at this point having been allowed to modify the certification, appellant remained qualified , this therefore means the court a quo erred in holding that appellant was precluded from being evaluated.”
ACTING JUSTICE OF APPEAL
DR KE MOSITO
PRESIDENT OF THE COURT OF APPEAL
For the Appellant: ADV T KUOANE
For the 1ST, 2ND, 3RD, 4TH AND 6TH Respondents:
ADV M SEKATI
For the 5th Respondent: P R CRONJè
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