Republic v Public Procurement & Administrative Review Board & 2 others; Peesam Limited (Exparte) (Application E131 of 2023) [2023] KEHC 23398 (KLR) (Judicial Review) (13 October 2023) (Judgment)
Neutral citation:
[2023] KEHC 23398 (KLR)
Republic of Kenya
Application E131 of 2023
J Ngaah, J
October 13, 2023
Between
Republic
Applicant
and
Public Procurement & Administrative Review Board
1st Respondent
Accounting Officer Kenya Airports Authority
2nd Respondent
Kenya Airports Authority
3rd Respondent
and
Peesam Limited
Exparte
Judgment
1.The applicant has moved this Honourable Court in a motion dated 7 September 2023 for orders of certiorari and mandamus against the respondents. The orders have been framed thus:1.That an order of certiorari be and is hereby issued quashing the decision of the 1st respondent made on 30th August 2023 in its entirety and all consequential actions arising from the said decision2.That an order of certiorari be and is hereby issued quashing the 3rd respondent’s letter dated 24 July 2023 terminating proceedings for Tender No KAA/OT/JKIA/0105/2022-2023 for the provision of landscaping and environment management services at the Jomo Kenyatta International Airport-Nairobi.3.That an order of mandamus be and is hereby issued against the 2nd and 3rd respondents compelling them to proceed with the evaluation of the applicant’s tender submitted or 4th April 2023 at 7:33 AM in accordance with the provisions of the tender documents in respect of Tender No KAA/OT/JKIA/0105/2022-2023 together with the Public Procurement and Asset Disposal Act 2015, the Public Procurement and Asset Disposal Regulations 2020, and the Constitution of Kenya, 2010.”
2.The applicant has also asked for an order to be made on costs.
3.The application is based on a statutory statement dated 4 September 2023 and an affidavit sworn on even date by Samuel Mburu Nganga verifying the facts relied upon.
4.Mr. Nganga has sworn that he is the director of the applicant. It is his deposition thatthe 3rd respondent invited bids for Tender No KAA/OT/JKIA/0105/2022-2023 for the provision of landscaping and environment management services at Jomo Kenyatta International Airport. Following this invitation, and more particularly on 7 February 2023, the applicant downloaded a complete set of tender documents for purposes of submitting its bid for the tender.
5.On 21 February 2023, the applicant received an addendum from the 3rd respondent extending the closing date for the submission of tenders and the opening date for the submitted tenders from 23 February 2023 to 9 March 2023. On 7 March 2023, the applicant received another addendum extending the closing date for the submission of tenders and the opening date for the submitted tenders from 9 March 2023 to 23 March 2023. For the third time, on 17 March 2023, the applicant received an addendum extending the closing date for the submission of tenders and the opening date for the submitted tenders from 23 March 2023 to 4 April 2023.
6.The applicant submitted its initial bid on 3 April 2023 before subsequently amending it.
7.According to the applicant, the 3rd respondent's online application portal did not have an option for withdrawing submitted bids or for filing a notice of withdrawal of tender bids. That being the case, the applicant sought clarification from the 3rd respondent on how to file a notice to withdraw the tender bid the applicant had earlier submitted.The applicant was advised to file an amended version of the form of the tender. The amended version was to be considered as the final tender bid submitted by the applicant for consideration.
8.The 2nd and 3rd respondents evaluated the applicant's amended tender and found it to be responsive. The bid qualified at the preliminary stage; the technical stage and finally, the financial stage. Having surmounted these hurdles, the evaluation committee recommended the award of the tender to the applicant at the tender price of Sixty-Three Million, Seven Hundred and Eighty-Three, Eight Hundred and Twenty Kenya Shillings only (Kshs 63,783,820.00) inclusive of all taxes.
9.Vide a professional opinion dated 24 July 2023, the 3rd respondent's acting general manager in procurement and logistics section reviewed the procurement process and recommended the termination of the tender on account of non-responsiveness. On even date, the applicant received a letter from the 2nd respondent notifying the applicant of the termination of the subject tender on the ground that the applicant submitted two tender documents without any written notice of withdrawal. This was despite the fact that the 3rd respondent’s portal did not have a function for withdrawal or substitution of a bid or a provision for what the applicant has described as modification notice.
10.The applicant took its case to the 1st respondent and in its decision on the applicant’s application, the 1st respondent acknowledged that the 2nd respondent did not terminate the subject procurement process in accordance with section 63 of the Public Procurement and Asset Disposal Act, 2015. Even with this acknowledgment, the 1st respondent still upheld the termination of the tender.
11.It is the applicant’s case that the 1st respondent erred in failing to consider the fact that the 3rd Respondent's tender application portal did not have a provision for withdrawal of tender or for filing of a notice of withdrawal of tender.
12.It is also contended that it was irrational and illegal for the respondents to rely on technicalities to conclude the applicant's final tender form was non-responsive contrary to section 79 of the Public Procurement and Asset Disposal Act, 2015.
13.The applicant had a legitimate expectation that its tender bid submitted on 4 April 2023 was to be considered as its final bid having been advised to file the amended tender form, in the absence of the option to withdraw the initial tender. On previous occasions, the applicant had made similar amendments without filing any notice of withdrawal and the 3rd respondent considered the final tender bid. For instance, the applicant had been awarded the tender being KAA/OT/JKIA/0148/2021- 2022 for the provision of pest control management services at the Jomo Kenyatta International Airport Terminal 2 in which the applicant had apparently filed an amended tender without withdrawing the initial tender he had submitted.
14.James Kilaka, the 1st respondent’s acting secretary swore replying affidavit opposing the applicant’s application.
15.The affidavit has largely chronicled the events that began with the applicant’s filing of thee request for review which was dated 9 August 2023 registered on even date before the 1st respondent as application No 55 of 2023. These events culminated in the 1st respondent’s decision that was rendered on 30 August 2023 which decision is the subject of the instant proceedings.
16.Kilaka has defended the 1st respondent’s decision and urged that the applicant has failed to demonstrate any elements of illegality, irrationality, procedural impropriety or unfairness in the manner in which the 1st respondent considered and interrogated the applicant’s application before reaching its decision.
17.The 2nd and 3rd respondents did not file any response to the applicant’s application.
18.Having considered the applicant’s and the respondents’ submissions, one thing that comes out clearly is that the facts that form the background upon which the application is made are not in dispute.
19.The applicant was one of the bidders in a tender floated by the 3rd respondent for landscaping and environment management services more particularly described as “Tender No Tender No KAA/OT/JKIA/0105/2022 –2023 for Provision of Landscaping and Environment Management Services at Jomo Kenyatta International Airport, Nairobi.” The tender was floated sometimes in February, 2023.
20.It is not in dispute that only four tenderers submitted bids for the tender and out of these four, only the applicant was found to have submitted a responsive tender. The rest of the tenders were found to be non-responsive at the very preliminary stage of evaluation. The applicant’s bid was the only bid that was evaluated at the rest of the stages of evaluation which are, the technical stage and the financial stage. It was able to surmount these stages and, eventually, the evaluation committee found the applicant to be the lowest evaluated responsive bidder. The committee thus recommended the applicant for the award of the tender at the tender price of Kshs 63,783,820.
21.But the 3rd respondent’s acting general manager in procurement and logistics was of the opinion that the tender was non-responsive. The manager, who has been identified in the affidavits and pleadings as Ms. Lilian Okidi also noted that the applicant submitted two tender documents without any notice of withdrawal, substitution or modification contrary to condition No ITT 26.1 in the Tender Document.
22.Following Okidi’s opinion, the tenderers were notified of the termination of the tender on 24 July 2023.
23.Aggrieved by the decision of the 3rd respondent, the applicant took up the matter with the respondent and filed a request for review in accordance with section 167 (1) of the Public Procurement and Asset Disposal Act. This section reads as follows:167.Request for a review(1)Subject to the provisions of this Part, a candidate or a tenderer, who claims to have suffered or to risk suffering, loss or damage due to the breach of a duty imposed on a procuring entity by this Act or the Regulations, may seek administrative review within fourteen days of notification of award or date of occurrence of the alleged breach at any stage of the procurement process, or disposal process as in such manner as may be prescribed.
24.The respondent took up the matter as it is enjoined to under section 171 (1) of the Act and made its determination within the prescribed timeline. According to this decision the applicant had sought the following orders:a.That the Notice of Termination dated 24th July 2023 terminating the procurement proceedings arising from Tender No KAA/OT/JKIA/0105/2022- 2023 for the provision of landscaping and environment management services at the Jomo Kenyatta International Airport be annulled and set aside;b.That the procurement proceedings leading to the determination by the Respondents that the applicant’s submitted tender bid was non-responsive be reviewed by this Honourable Board;c.That the Board be pleased to order the respondents to evaluate the applicant’s tender bid submitted on 4th April 2023 at 7.33 a.m. in accordance with the provisions of the tender documents in respect of Tender No KAA/OT/JKIA/0105/2022-2023 together with the Public Procurement and Asset Disposal Act 2015, the Public Procurement and Asset Disposal Regulations 2020, the Fair Administrative Action Act 2015 and the Constitution of Kenya 2010;d.That the 2nd respondent be ordered to pay the Applicant the full costs of and incidental to these proceedings for its noncompliance that necessitated this Request for Review.”
25.In determining the applicant’s application, the 1st respondent singled out the following issues for determination:i.Whether the procuring entity terminated the subject procurement process in accordance with section 63 of the Act thereby ousting the jurisdiction of the board;ii.whether the applicant in submitting a second tender document in the subject tender without a written notice of substitution or withdrawal rendered its tender document non-responsive?iii.what orders should the Board grant in the circumstances?
26.On the first issue, the 1st respondent quoted section 63 of the Act in its decision and expressed what it understood that section to mean with respect to termination of procurement process. According to the 1st respondent, the procurement could validly be terminated if first, termination is based on any of the grounds under section 63 (1) of the Act; second, the accounting officer has given a written report to the Public Procurement Regulatory Authority within 14 days of the date of termination giving reasons for the termination and; third, the accounting officer has within 14 days of the date of termination given written notice to the tenderers in the tender communicating the reasons for the termination.
27.As far as the termination in issue is concerned, the 1st respondent held that the 3rd respondent terminated the tender on the ground that that none of the tenders submitted were responsive. This ground, according to the 1st respondent, is one of the grounds upon which a tender may be terminated under section 63 (1) of the Act. It, therefore, held that the 3rd respondent satisfied the first ground. It also held that a notification of the termination of the tender was given to the tenderers within the prescribed time and, therefore, the 3rd condition was also satisfied.
28.But as far as the second condition is concerned, the 1st respondent found that there was no evidence of a report made to the Public Procurement Regulatory Authority on the termination of the tender. Accordingly, the procuring entity did not terminate the subject procurement process in accordance with section 63 of the Act. The tender was, therefore, not validly terminated. Having so found, the 1st respondent came to the conclusion that it was seized of jurisdiction to dispose of the appeal before it and at the same time, in exercise of its powers under section 171 of the Act, it could order the procuring entity to comply and submit a written report to the Public Procurement Regulatory Authority. Indeed, the 1st respondent directed the procuring entity to act accordingly and submit its report. The order was expressed as follows in its decision:
29.On the second question for determination, the 1st respondent considered the procuring entity’s evidence that its online platform for submission of tenders has a function that supports withdrawal and substitution of tenders which the applicant failed to utilise when uploading the subsequent tender.
30.The 1st respondent considered the provisions of section 79 of the Act on the responsiveness of tenders and in particular subsection 1 thereof which reads as follows:79.Responsiveness of tenders(1)A tender is responsive if it conforms to all the eligibility and other mandatory requirements in the tender documents.
31.The 1st respondent noted that the particular requirement that was in issue was requirement No ITT 26.1 in the tender document; it provided as follows:
32.The 1st respondent also considered section 76 of the Act on the modification of tenders. This section reads as follows:76.Modification of bids(1)Before the deadline for submitting tenders, a person who submitted a tender may only change or withdraw it in accordance with the following—(a)the change or withdrawal shall be in writing; and(b)the change or withdrawal shall be submitted before the deadline for submitting tenders and in accordance with the procedures for submitting tenders.(2)After the deadline for submitting tenders, a person who submitted a tender shall not change, or offer to change the terms of that tender.
33.The 1st respondent noted that the applicant submitted two tender documents bearing different tender prices; the original tender had a tender price of Kshs 51,144,955.60 while the second tender and tender price of Kshs 63,783,820/=.
34.The 1st respondent established as a fact that the head of procurement had enquired whether there was any clarification sought by the applicant and whether there was any written notice by the applicant in the change of form of the tender. It noted that there was no such clarification and no notice of change or substitution was ever given by the applicant. It also established that at the opening of the tender, the recorded tender price by the applicant was Kshs 51,144,955.60 and not Kshs 63,783,820.
35.In coming to its decision, the 1st respondent noted as follows on this question:78.In the instant request, the applicant submitted 2 tenders i.e. original tender and subsequent tender without issuing a written notice of the withdrawal or substitution. The said tender documents also bear different tender prices. Which of these tender prices could validly be taken to be the applicant’s tender price in the subject tender in the absence of a notice of withdrawal or substitution.79.Both the Act and ITT 26.1 required a tenderer desirous of changing their already submitted tender to issue a written notice of substitution or withdrawal but none was issued in the present case. The effect of the multiple tenders without substitution or withdrawal notice is the confusion that arose on the applicant’s tender price. Whereas the tender opening committee picked the tender price in the original tender document, the evaluation committee picked the tender price in the subsequent tender. This sort of scenario undermines the competitiveness of any tender since different tender prices are associated with one tenderer to the disadvantage of the other tenderers participating in the same tender.80.Accordingly, the Board finds that the applicant in submitting a second tender document in the subject tender without a written notice of substitution or withdrawal rendered its tender document non-responsive.”
36.In interrogating the grounds upon which relief is sought in the statement, one thing that comes out clearly in this application is that the applicant has effectively escalated to this forum its grievances against the procuring entity before the 1st respondent. Its attack is mainly targeted at the procuring entity for terminating the procurement process.
37.Little wonder that in the motion before court, the 2nd and 3rd prayers are targeted at the 2nd and 3rd respondents.
38.The following contentions in the statutory statement add weight to this fact:"xivThe 2nd Respondent's conduct amounted to a breach of Article 227 of the Constitution which requires that public procurement be carried out in a system that is fair, equitable, transparent, competitive and cost-effective.xvi.It was irrational and illegal for the Respondents to rely on technicalities to conclude the Applicant's final tender form is non-responsive contrary to section 79 of the Public Procurement and Asset Disposal Act 2015.xvii.The Respondent are in breach of the doctrine of legitimate expectation and the doctrine of estoppel by terminating the procurement proceedings and determining that the Applicant's submitted tender bid was non-responsive on the basis that the Applicant submitted two tender - an initial tender and final tender - despite advising it to so since there was no withdrawal option on the online portal.xviii.The Applicant had legitimate expectation that its final tender submitted on 4th April 2023 was the final tender for consideration having been advised to do so and having won previous tenders - KAA/OT/JKIA/0148/2021-2022 for the provision of pest control management services at the Jomo Kenyatta International Airport Terminal 2 - which it amended by final amended tender form without filing Notice of Withdrawal and/or withdrawing initial tender forms.xix.The 2nd and 3rd Respondents' conduct amounts to breach of the rule of law of the Applicant's legitimate expectation and fair administrative action under Articles 10 and 47 of the Constitution as read together with the provisions of the Fair Administrative Action Act.xx.The respondents failed to appreciate that the tender application was done online hence misapplied the law by relying on clause ITT26 of the tender guideline and failing to consider ITT 23 which applies to physical tender rather than tender submitted online.”
39.The course adopted by the applicant is obviously contrary to section 175 of the Act according to which it is only the decision of the 1st respondent that may be subject to judicial review of this Honourable Court. The section reads as follows:175.Right to judicial review to procurement(1)A person aggrieved by a decision made by the Review Board may seek judicial review by the High Court within fourteen days from the date of the Review Board's decision, failure to which the decision of the Review Board shall be final and binding to both parties.
40.The court cannot proceed as if it is interrogating the decision of the procuring entity and overturn the decision of the Review Board as if this latter decision has been brought before this court on a second appeal.
41.And even assuming that that this court was entitled to address the decision of the procuring entity, it is trite that in exercise of its judicial review jurisdiction, the court will not assume appellate jurisdiction. It would not, therefore, seek to evaluate afresh the evidence presented before the procuring entity and substitute its decision with the court’s decision. Neither can it fault the Review Board on its findings on facts and interpretation of the law unless the findings are clearly inconsistent with evidence. Or the purported interpretation of the law clearly shows that the decision maker did not understand the law that regulates its decision making power and, further, the decision maker did not give effect to it. A decision tainted in such circumstances will be quashed not necessarily because the judicial review court would have reached different conclusions or interpreted the law differently but because no tribunal, given similar facts, would have reached similar conclusions on the facts or the law. In short, in judicial review circles, the decision would fall on the judicial review grounds of irrationality and illegality.
42.In Energy Regulatory Commission v S G S Kenya Limited & 2 others (2018) eKLR Civil Appeal No 341 of 2017 the Court of Appeal faulted the High Court for determining a judicial review matter as if it was an appeal, and for going into the merits of a decision already taken. The Appellate Court held it to be improper for the High Court to make value judgment regarding the evidence; to weigh the same, and to minutely examine it, to determine whether it reached a certain standard of acceptance. The Court found that the High Court had occasioned room for abuse of its power, by usurping the competences of the Public Procurement Administrative Review Board.
43.It was held that in a judicial review matter, the Court’s mandate is limited to procedural improprieties, and extends not to the merits of a decision. In the case before the Court of Appeal, the Board had been duly mindful of its own earlier decision in Avante International INC v IEBC (Review No 19 of 2017): it took into consideration the nature and weight of the opinion on technological change, which the procuring entity had acted upon; and the Board’s reasoning exhibited a fidelity to practicality and to good sense. Consequently, the Judge ought to have shown greater deference to the Board’s decision, and should have been more circumspect in its view of such a decision, bearing in mind the specializations of the Board.
44.And in OJSC Power Machines Limited, TransCentury Limited, and Civicon Limited (Consortium) v Public Procurement Administrative Review Board Kenya & 2 others [2017] eKLR Civil Appeal No 28 of 2016 it was held that:
45.Further in Biren Amritlal Shah & another v Republic & 3 others (2013) eKLR it was held:
46.Turning back to the grounds upon which relief is sought, I am not satisfied that the applicant has demonstrated that the 1st respondent’s decision is tainted by illegality or irrationality.
47.The decision cannot be faulted on the ground of illegality merely because the applicant thinks that the 1st respondent relied on what the applicant has described as technicalities to find the applicant’s bid non-responsive. The 1st respondent, as noted, considered the requirement No ITT 26.1 and section 79 on withdrawal and modification of tenders and found that the applicant’s bid had flouted both the requirements and the provision of the law. It does not matter that the applicant would regard the requirements under section 79 and in the tender document as ‘technicalities’ that, in its view, ought to have been overlooked. But the point is that, in finding that the applicant’s bid was non-responsive, the 1st respondent considered the law and the requirements that the tenderers were under obligation to meet.
48.As far as section 63 of the Act is concerned, the 1st respondent held that the procuring entity did not notify the Procurement Regulatory Authority of the termination of the tender but in its view, the omission should not have been a reason to award the tender to a non-responsive bidder. It instead opted to exercise its powers under section 173 of the Act and directed the accounting officer of the procuring entity to regularise the termination by issuing the requisite notice to the Regulatory Authority. This section reads as follows:173.Powers of Review BoardUpon completing a review, the Review Board may do any one or more of the following—a.annul anything the accounting officer of a procuring entity has done in the procurement proceedings, including annulling the procurement or disposal proceedings in their entirety;b.give directions to the accounting officer of a procuring entity with respect to anything to be done or redone in the procurement or disposal proceedings;c.substitute the decision of the Review Board for any decision of the accounting officer of a procuring entity in the procurement or disposal proceedings;d.order the payment of costs as between parties to the review in accordance with the scale as prescribed; ande.order termination of the procurement process and commencement of a new procurement process. (Emphasis added)
49.It can be noted that from this provision of the law that the 1st respondent has powers to not only give directions to the accounting officer to do anything in the procurement but also order termination of the procurement process. The direction for the procuring entity to regularize the termination of the procurement process by writing to the Regulatory Authority cannot, therefore, be said to have been illegal or irrational. That direction has a legal basis.
50.The grounds of irrationality and illegality upon which the applicant has pitched his quest for the judicial review reliefs were enunciated in Council of Civil Service Unions versus Minister for the Civil Service (1985) A.C. 374,410. In that case, Lord Diplock set out the three heads which he described as “the grounds upon which administrative action is subject to control by judicial review”. These grounds are illegality, irrationality and procedural impropriety. The first two would be of concern to the applicant’s application. Lord Diplock spoke of them as follows:
51.As I have noted before in this judgment, there is nothing to suggest that the 1st respondent did not understand correctly the law that regulates its decision-making power or that it did not give effect to it. Neither can it be said that its decision is so outrageous in its defiance of logic or of accepted moral standards that no sensible person who had applied his mind to the question to be decided could have arrived at it.
52.As far as the ground of legitimate expectation is concerned, the applicant had urged that:
53.Based on this contention the applicant urged that it was its legitimate expectation that it was going to receive similar treatment and that its tender was going to be considered without filing a notice of withdrawal or modification. But the 1st respondent refuted this allegation and stated in the alleged previous tender the applicant had submitted two similar tenders unlike in the present case where the tender amounts were varied. In any event, the applicant did not present the tender document in the previous tender for a comparison of the requirements. The ground of legitimate expectation would not be viable in these circumstances.
54.For reasons I have given, I am not satisfied that the applicant has established a case to persuade this Honourable Court to exercise its discretion in its favour and grant the reliefs sought. The suit is dismissed with costs. It is so ordered.
SIGNED, DATED AND DELIVERED AT NAIROBI ON 13 OCTOBER 2023NGAAH JAIRUSJUDGE