The quest for ‘reasonable certainty’: Refining the justice and equity remedial framework in public procurement cases

• Published date: 27 November 2020
• Citation: (2020) 137 SALJ 659
• Pages: 659-697
• Date: 27 November 2020
• Author: Cachalia, R.

659

THE QUEST FOR ‘REASONABLE CERTAINTY’:

REFINING THE JUSTICE AND EQUITY

REMEDI AL FRAMEWORK IN PUBLIC

PROCU R EMEN T CA SE S

RAISA CACHALIA†

Lecturer, Faculty of L aw, University of Johanne sburg

LAU RE N KOHN‡

Senior Lectu rer, Department of Pu blic Law, University of Cape Town

Flowing fro m the constitution al imprimatur in s 172(1) to further ‘justic e and equity’

(‘J&E’), the courts have mad e important stride s in developing a framew ork for remedying

irregular publi c procurement. T hey have not, however, done so clearly a nd coherently;

nor in a way that enc ourages predictability in remedial ou tcomes. In response, we have

sought to leverage an a rgument for ‘rea sonable cert ainty’ as a rule- of-law justi cation

for rening the f ramework in a comp rehensive and help ful way that does not p it

form against ‘ind ividualised justic e’. We have done so against the backdrop of tw o

hypothetical te nder scenarios — a review b y a private contractor and a state self -review

— based upon a patter n emerging fro m the jurispr udence. Throug h our analysis, we

illustrate that ultima tely the J&E enquiry is a k ind of proportio nality assessme nt that

has, at its hear t, an appreciat ion of the overall ‘impa ct’ of setting a t ender aside, from

both a practical a nd principle d perspective. We posit a two-st ep approach to addressing

this overarching ‘ impact question’: a big-pic ture assessment o f the various inte rests to

be weighed in the bala nce, followed by the pa rticular ised balancin g of these aect ed

interests wit h reference to se veral open-li st factors. Ultima tely, we seek to provide a

principled a nd pragmatic guide for t he exercise of the c ourts’ remedial di scretion and so

draw the analysis toget her by applying th is framework to th e scenarios sket ched.

Just and equit able remedy – publ ic procurement – ce rtai nty – lega lity –

compensat ion – delay – state sel f-review – Gijima

I IN T RODUC TIO N

The question as to how to reme dy invalid t enders has become a pe rsistent

challeng e for South Afr ican cour ts, especia lly in re cent years given the

‘alarm ing freq uency’1 with which publ ic procurement contr acts are bei ng

subjected to judici al review. What is more, a survey of t he expanding body

of case law in th is area revea ls a clear pat tern: we are seei ng permutat ions

of essentia lly two re -occur ring scena rios that f requently come before t he

† BA LLB LLM ( Wits). Attor ney of the High C ourt of South A frica . ht t p s ://

orcid.org/0000-0003-0407-9142.

‡ BBu sSci LLB L LM (UCT). Att orney of the Hi gh Court of S outh Afr ica.

https://orcid.org/0000-0002-8453-4952. We would like to th ank the an onymous

reviewers for t heir insig htfu l observat ions and sug gestions for s trengt hening

this piece.

1 South Afric an Post Oce v De L acy 2009 (5) SA 255 (SCA) (‘De Lac y’) para 1.

(2020) 137 SALJ 659

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660 (2020) 137 THE SO UTH AFRICAN L AW JOURN AL

courts on rev iew. Consider a hypothetica l tender for the sett ing-up of

a piloted, automa ted solution for the centra lised m anagement of lea rner

appli cations and ad mission s to ten public schools in G auteng. The pilot

contract is to r un for a xed, non -renewable three -year period and

requires t he appointed contrac tor to set up and man age the syst em for the

contract’s durat ion. The objective is to upsk ill the r elevant depar tment to

be self-operat ional at all ten schools by the end of t he contract perio d and,

ultim ately, to lay the groundwork for a cou ntry wide roll- out of a fully

function al digit al syste m.

In ‘Scenar io 1’ the contract is awa rded to ‘A’, an empowerment st art-up

which tenders the le ss competitively priced bid. The contr act is so awarded

on the basis of what wa s, in essence, a m isunder standi ng of the technic al

proposal, g iven that the two lead ing bidders (A and B) oered wh at appeared

to be the same solution f rom a general f unctiona lity per spective and in

respect of the unde rlying technology us ed. The unsuccessful t enderer (‘B’)

seeks to have the award of t he contract set as ide in review proceed ings.

However, by the time the mat ter comes before the cour t, the contract h as

been run ning for near ly two years a nd A has invested sub stantial resources

in the exped itious disch arge of its contr actual o bligation s.

In ‘Scenar io 2’ the state — u nder pressure to g et the pilot project up

and run ning — neg lects to ru n a competitive biddi ng process a ltogether

and simply appoi nts a contractor (‘X’ ) to do the work. The contra ctor,

an emergi ng black-owned enter prise, is un fami liar w ith the labyr inthi ne

regula tory regi me and, act ing in good f aith, take s the state’s assura nces as

to the lawfu lness of the contract at f ace value. Fast forward nea rly two years

and the state doe s a volte-face, ref using to ma ke good on its contra ctual

underta king s. This fol lows signi cant time -and-money injec tions to im-

ple ment the cont ract by X, which the n sues the state pa rty for payme nt of

what has been prom ised. Despite its earlier a ssurance s, the state then r aises

the spectre of i llegal ity for the r st time and pr oceeds to seek the set ting

aside of the contra ct reactively in r eview proceedi ngs.

While t he scenarios pr esented here are hy pothetical one s, a cursor y

perusa l of our procurement ju risprude nce makes plai n that the sa lient

factua l, and accompany ing remed ial, issue s that they ra ise are neither

novel nor unfam ilia r. In fact, as noted , they tend to play out repeat edly

in vary ing inca rnation s. Given this tre nd, one would have expecte d the

courts to h ave developed a clear, coherent and relat ively comprehensive

methodology for the r esolution of procurement dispute s. Yet there remai ns

a high deg ree of uncerta inty — a nd in fact an xiety — a round remedia l

outcomes in thi s eld; a problem agg ravated by the cour ts’ apparent

reticence to develop the compen sation remedy ex plicitly provid ed for in

the Promotion of Adm inist rative Justice Ac t 3 of 2000 (‘the PAJA’).2

2 Note that while we g ive some attention to this topic , a detaile d proposal for

the development of th is remedy is be yond the scope of thi s piece.

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THE QUE ST FOR ‘REASONA BLE CERTAINTY’ 661

Again st this contex tual ba ckdrop, this ar ticle seeks to a ddress t wo key

interrela ted objectives. The overarchi ng aim is to high light the import ance

of promoting ‘reas onable certa inty’3 in t he adjudication of tender d isputes

and, cruc ially, in the development of pro curement remedie s. Such an

approach is necessit ated by the ru le of law,4 which demands, amon gst

others, that t here be a level of certa inty and pred ictabil ity in remed ial

outcomes, without depr iving t he courts of the nece ssar y exibilit y to do

justice in a g iven case.5 Aft er all, certaint y and legality a re both aspirations

in the ru le of law’s basket of ideals, a nd need not be pitted ag ainst one

another in an eit her-or fash ion. Given this broad aim, the second a nd core

focus of this piec e is to leverage the a rgument for rea sonable certa inty

as the norma tive justic ation for an urgent ly needed renement of t he

generalised s 172 (1) 6 constitut ional remed ial fra mework to suit the just a nd

equitable resolut ion of procurement di sputes specic ally.7

3 See in g eneral Malcolm Wal lis ‘Commercia l certaint y and constitution alism:

Are they compa tible?’ 2016 (133) SALJ 545 at 548 referri ng to the need for

‘reasonable cer taint y’ in the res olution of commerc ial dis putes to go about

one’s business ‘k nowing the r ules of the g ame’; Daniel Freu nd & Alist air Pr ice

‘On the legal e ects of un lawfu l admi nistra tive action’ (2017) 134 SALJ 184;

Raisa Ca chalia ‘Cl arif ying t he test for except ional circ umsta nces in Tr en co n : An

opportu nity mi ssed’ (2015) 7 Con stitutional Cour t Review 115; and Stu Woolm an

‘The ama zing, van ishin g Bill of R ights’ (200 7) 124 SALJ 762 at 763, where he

explai ns that ‘[a]n approach to con stitut ional adjudic ation that m akes it di cult

for lower court judg es, lawyers, govern ment ocials and cit izens to discer n, with

some degree of cer tainty, how the basic law is g oing to be appl ied, and to know,

with some deg ree of cert ainty, that t he basic law is g oing to be appl ied equal ly,

constitut es a parad igmat ic violation of t he rule of law’.

4 See for examp le Mighty Solutions CC t/a Orlando S ervice St ation v Engen

Petroleum Ltd 2016 (1) SA 621 (CC) para 37 that ‘ legal cer taint y is esse ntial

for the rule of l aw — a constitut ional va lue’; Ferreira v Levin NO; Vryen hoek v

Powell NO 1996 (1) SA 984 (CC) para 26 t hat ‘lega l certa inty, being a ce ntral

considerat ion in a constitut ional state’; President of the R epublic of South Afri ca v Hugo

1997 (4) SA 1 (CC) para 102 that ‘[t]he need for acces sibility, precision a nd general

application ow f rom the concept of the r ule of law. A person shou ld be able to

know of the law, and be able to con form his or her conduct to the law.’

5 Freder ick Schauer Thi nking Like a La wyer — A New Introdu ction to Legal

Reasoning (2009) ch 10.3 at 195. On st riki ng the bal ance between pre dictabi lity

and ‘ind ividual ised just ice’ Schauer expl ains th at ‘although so me Rule of Law

values are se rved by preci se, predict able, and under standab le rules, ot hers are

served by rela tively open-ended sta ndards that wi ll allow judges a nd other ocial

decision-m akers the discretion t o do justice in t he individu al case’.

6 Se ction 172(1) of the Constitution r eads: ‘Whe n decidin g a constitut ional

matter w ithin its p ower, a court — (a) must decla re that any l aw or conduct that

is inconsi stent with the C onstitut ion is inval id to the extent o f its inconsi stency;

and (b) may ma ke any order th at is just and equ itable, includ ing — (i) an ord er

limit ing the ret rospective e ect of the decla ration of inva lidity; and (ii) a n order

suspendi ng the decla ration of inva lidit y for any period a nd on any condit ions, to

allow the comp etent authorit y to correct the defect.’

7 In fac t, Quinot su ggests t hat the cour ts’ preference for what he t erms a

‘generali sed approach’ t o remedies i n all constitut ional mat ters decid ed under

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