Madibeng Local Municipality v DDP Valuers (Pty) Ltd and Another

Madibeng Local Municipality invited tenders in May 2013 for compilation of a new valuation roll and residual services for the period 1 July 2014 to 30 June 2018. The Municipality awarded the tender to Dijalo Property Valuers, despite DDP Valuers and Activa Valuation Services submitting significantly lower bids. DDP successfully challenged the award, and Makgoba JP reviewed and set aside the decision on 13 November 2015, remitting the matter to the Municipality for reconsideration. By this time, Dijalo had already submitted the valuation roll. The Municipality then decided to cancel the tender and appointed Activa under Regulation 32 of the Municipal Supply Chain Management Regulations to perform only residual services from 25 February 2016 to 30 June 2018, relying on a contract Activa had with Greater Taung Local Municipality. DDP challenged this decision, arguing the Municipality failed to reconsider the tender award as ordered and that the Regulation 32 appointment was invalid. The court a quo found in DDP's favour, but by the time the matter reached the SCA, Activa's appointment had expired on 30 June 2018, rendering the matter moot.

• Whether the application for leave to appeal should be dismissed on the ground that a decision on appeal would have no practical effect or result in terms of section 16(2)(a)(i) of the Superior Courts Act 10 of 2013
• Whether an application for leave to appeal should be referred to the full court under section 17(2)(d) for determination of the mootness question
• Whether a moot appeal should nevertheless be heard where it raises discrete legal issues of public importance
• Whether the matter raised reviewable legal issues concerning: (a) cancellation of tenders under PAJA; (b) procurement under Regulation 32 after tender cancellation; (c) interpretation of 'under a contract secured by another organ of state'; and (d) interpretation of 'demonstrable discounts or benefits' in Regulation 32

The application for leave to appeal was dismissed with costs.

The binding legal principles established by this judgment are: (1) Judges considering applications for leave to appeal to the Supreme Court of Appeal under section 17(2) of the Superior Courts Act must themselves determine whether the proposed appeal would have any practical effect or result as required by section 17(1)(b), and should not, save in exceptional circumstances, refer this anterior question to the full court under section 17(2)(d); (2) An application for leave to appeal must be dismissed where the matter is moot (i.e., the decision sought would have no practical effect or result) unless the matter presents a discrete legal issue of public importance that would affect matters in the future and on which adjudication is required; (3) A moot appeal will not be heard merely because parties propose legal questions in the abstract - the legal issues must actually arise on the facts and findings of the case; (4) There is no conflict in the case law regarding reviewability of tender cancellations under PAJA: the cancellation of a tender by an organ of state prior to its adjudication constitutes an exercise of executive authority and is not reviewable under PAJA, whereas a decision to cancel a tender during the tender process (including after award) is subject to principles of administrative justice and is reviewable under PAJA.

The court made several important obiter observations: (1) The purpose of section 16(2)(a) and related provisions is twofold: to reduce the heavy workload of appeal courts and to ensure that matters truly deserving attention are not delayed by burdening courts with matters that would have no practical effect; (2) Judges considering applications for leave to appeal should generally have little difficulty determining whether an appeal would have practical effect, and in cases of doubt they may request the record under Rule 6(6) or order oral argument under section 17(2)(d) if circumstances require; (3) Referring the mootness question to five judges of the full court is 'plainly counter-intuitive' as it defeats the very purpose of the mootness provisions; (4) The court cited with approval the principle from Radio Pretoria that 'Courts of appeal often have to deal with congested court rolls. They do not give advice gratuitously. They decide real disputes and do not speculate or theorise'; (5) The court noted that on a proper application of the law, a decision by an organ of state to cancel a tender after it has been awarded would generally be reviewable under PAJA, as principles of administrative justice continue to govern the relationship between the organ of state and tenderers in such circumstances.

This case is significant in South African administrative and procedural law for several reasons: (1) It clarifies the procedure to be followed when considering applications for leave to appeal that may be moot, emphasizing that judges considering such applications should determine mootness themselves rather than referring this question to the full bench; (2) It reinforces the principle that appeal courts should not be burdened with moot matters that waste judicial resources and delay cases deserving attention; (3) It confirms that even where a matter is moot, it will only be heard in exceptional circumstances where discrete legal issues of public importance requiring adjudication are raised; (4) It provides guidance on the application of sections 16(2)(a) and 17(1)(b) of the Superior Courts Act 10 of 2013; (5) It clarifies that there is no conflict in the jurisprudence regarding reviewability of tender cancellations under PAJA - cancellations before award are executive acts while cancellations during the tender process (including after award) are reviewable administrative action. The judgment serves as important guidance for both lower courts and practitioners on efficient case management and the proper use of appellate resources.