Municipal Manager: Qaukeni and Others v F V General Trading CC (324/2008) [2009] ZASCA 66 (29 May 2009)

Public procurement – contract awarded for the provision of services to
organ of state – no open tender process followed, as required – agreement unlawful for want of compliance with legal prescripts – further contracts for provision of services also unlawful – effect of settlement agreement – court cannot validly make settlement
agreement an order if settlement agreement unlawful.

Contract awarded for the provision of services to organ of state – no
open tender followed – action brought to enforce impugned contract – collateral challenge – whether court entitled to declare contract invalid and unlawful despite organ of state not having launched counter-application to review and set aside that contract.

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

Procurement by municipality of debt management services – quintessentially a constitutional issue – factors to be applied in considering delay in self-review by public authority – contract invalid for want of compliance with applicable regulations and constitutional imperatives – s 172(1)(b) applied – just and equitable remedy to avoid denying accrued rights – part of contract not set aside – concern about frequency of late self-review applications where contract periods have run their course and no sanctions for aberrant officials.

Companies Act 71 of 2008 – business rescue proceedings - whether it was
just and reasonable to set aside a creditor’s vote against the adoption of a proposed
business rescue plan on the ground that its result was inappropriate. Held: there is no
justification for interfering with the discretion exercised by the high court – appeal
dismissed with costs