Imagine trying to bake a cake with an expired ingredient, one bad egg and you end up with a disaster instead of a dessert. That's exactly what happened when one member's expired appointment to the bid evaluation committee caused the cake to flop. When government and public entities issue tenders, a Bid Evaluation Committee (BEC) is responsible for the evaluation of the bids and weighs up each bid before recommending a successful bidder. This sounds straightforward, but a recent High Court judgment highlights a crucial point: if any member of that committee is not properly authorised or appointed, the whole process can unravel.
The judgment, in which we, the FWB Team, represented the applicants, concerned a dispute involving routine road-maintenance contracts. Amid the various issues debated, the Court zeroed in on how one member's expired appointment effectively undermined the Bid Evaluation Committee's composition.
In this case, the South African National Roads Agency (SANRAL) issued tenders for consulting engineering services for the routine road maintenance of several freeways in and around Tshwane, Johannesburg and Ekurhuleni. The incumbent contractor that had held these contracts for over two decades contested SANRAL's decision to award the new contracts to a different bidder, arguing, among other things, that SANRAL's Bid Evaluation Committee (BEC) was improperly constituted.
The Court found that if even one unauthorised person, whose term of appointment had merely expired, participates in the BEC's deliberations, the committee is considered improperly constituted. As a result, the committee's recommendations, and thus the tender awards, are invalid and fall to be set aside. As a non-member, he had the potential to influence the other members' views on the tenders. Thus, the Court found that his presence and participation caused the BEC not to be properly constituted and tainted the sitting of the BEC and any decision taken by it. Decision making committees, like the BEC or Bid Adjudication Committees, must be properly constituted in order for them to have the requisite authority to bind organs of state.
Our law is replete with examples of reviews succeeding because decision-making bodies were improperly constituted. For example, a decision by the Competition Commission was reviewed and set aside because one of the members of the Commission, the Commissioner, was absent from the meeting.
It was argued in this matter that it does not matter that one member's appointment to the BEC had expired, because a quorum was present, and enough qualified members were present at the critical meeting to carry the vote. This argument is inconsistent with basic administrative law. As Cora Hoexter & Glenn Penfold says in Administrative Law in South Africa (Juta, at 228) "as a general rule, and unless a quorum is specified, action must be taken by all of the members". The members have been selected for a purpose and that purpose would be defeated if one or more of the members were not present at the time of adjudication. Absent SANRAL being able to rely on any provision in any relevant document or regulation allowing a non-member of the BEC to participate in or advise the BEC in connection with the scoring process or attending committee meetings in an advisory capacity, it was clear that this egg had reached its expiration date and should have been kept out of the bowl.
On this ground alone, the Court reviewed and set aside the decisions of the BEC and the awarding of the tenders. Because the Court found the BEC to have been improperly constituted, the ultimate award (and any decisions flowing from the BEC's recommendation) had to be set aside. The tenders were remitted to SANRAL to start the tender process afresh.
In conclusion, a properly constituted BEC is crucial to fair public procurement processes. As this judgment shows, overlooking a seemingly minor detail (like an expired appointment) can nullify the entire process. The Court's message is clear: thorough compliance with the rules isn't optional, and a single rotten egg has the potential to unravel an entire procurement process.
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