Republic v Public Procurement Administrative Review Board & another; Celmel Insurance Agency (Exparte) (Application E111 of 2024) [2024] KEHC 13707 (KLR) (Judicial Review) (18 October 2024) (Judgment)
Neutral citation:
[2024] KEHC 13707 (KLR)
Republic of Kenya
Application E111 of 2024
J Ngaah, J
October 18, 2024
Between
Republic
Applicant
and
Public Procurement Administrative Review Board
1st Respondent
Chief Executive Officer Social Helath Security
2nd Respondent
and
Celmel Insurance Agency
Exparte
Judgment
1.The applicant’s application is a motion dated 5 November 2024 filed under Articles 10, 27, 47 and 227 of the Constitution; Sections 8 and 9 of the Law Reform Act, Cap 26; Sections 7, 8, 9, 10 and 11 of the Fair Administrative Action Act, 2015; and Order 53 Rule 1 of the Civil Procedure Rules. The applicant seeks the following orders:The applicant has also sought for costs of the application.
2.The application is based on a statutory statement dated 4 September 2024 and an affidavit verifying the facts relied upon sworn on even date by Mr. Festus Wanjohi who has introduced himself as the applicant’s Chief Executive Officer.
3.According to these documents, Social Health Authority which, I will henceforth refer to as “the procuring entity” advertised and invited bids for a tender for provision of insurance services. The tender was more particularly described as “Tender number SHA/001/2024-2025 for the provision of Insurance Services”. I will refer to it as “the subject tender”.
4.Mr. Wanjohi has sworn that although the Applicant downloaded the tender, it could not submit a bid because, allegedly, the conditions in the tender did not comply with the requirements of the Constitution, the Public Procurement and Asset Disposal Act, 2015 and Public Procurement and Asset Disposal Regulations, 2020. I will hereinafter refer to these two legal instruments as “the Act” and “the Regulations” respectively.
5.The Applicant challenged the procuring entity’s decision to advertise what the applicant opines is an illegal tender by filing a request for review before the 1st Respondent, being Application No. 74 of 2024. The primary contention in the application was that the Applicant could not submit a tender because the 2ⁿᵈ Respondent included in the tender document what the applicant considered irregular and illegal qualifications which, in effect, locked out the Applicant from participating in the subject tender.
6.In a decision rendered on 30 August 2024, the 1st Respondent dismissed the application. The applicant was aggrieved by the 1st respondent’s decision and it is for this reason that it has exercised its rights under section 167(1) of the Act to initiate the instant proceedings.
7.The grounds upon which judicial review reliefs are sought are more or less the facts to which the applicant has deposed in the affidavit verifying facts relied upon. The applicant has not come out categorically to state the heads of judicial review upon which its application is based. However, as much as I can decipher from its statutory statement, illegality and procedural impropriety, appear to be the grounds on which the applicant relies for the judicial review reliefs sought. This I gather from paragraphs 7, 9 to 14 where it is averred as follows:
8.The respondents have opposed the application and, in that regard, they have filed replying affidavits. The 1st respondent’s affidavit has been sworn by Mr. James Kilaka who has introduced himself in the affidavit as a procurement professional and the Acting Secretary of the 1st Respondent. He states that he also heads the 1st Respondent’s secretariat.
9.Mr. Kilaka admits that the applicant challenged the procuring entity’s decision of advertising the subject tender. After all the parties to the request for review had been heard, the respondent delivered its decision on 30 August 2024 dismissing the application. To be precise, the 1st respondent’s orders were as follows:
10.The rest of the affidavit is largely in defence of the 1st respondent’s decision and, Mr. Kilaka has, more or less, reproduced the salient parts of the decision including the issues identified for determination and the 1st respondent’s determination of those issues. That being the case, it has been contended on the 1st respondent’s behalf thatApplicant has failed to single out any issue that it raised in the impugned proceedings that the 1st Respondent failed to address in its decision.
11.In the ultimate, it is contended that the Applicant has not provided proof of illegality, irrationality, procedural impropriety or unfairness in the manner in which the Respondent considered and interrogated the pleadings and the evidence with which it was presented.
12.Mr. Elijah G. Wachira swore a replying affidavit in which he identified himself as the acting chief executive officer of the 2nd respondent and, in that capacity, he is charged with the day to day running of the activities of the procuring entity in accordance with the provisions of section 14 of the Social Health Act.
13.According to Mr. Wachira, the subject tender was prepared in accordance with the specifications provided by the User Department and the Standard Tender Document for Provision of Insurance Services published by the Public Procurement Regulatory Authority. The subject tender was advertised on 2 August 2024 but before any tender was received, the procurement proceedings were suspended as a result of the request for review proceedings filed before the 1st respondent by the applicant.
14.Contrary to the applicant’s allegations, the requirements of the tender as captured in the tender document were consistent with the Constitution, the Act and Regulations. The tender was also consistent with Public Procurement Regulatory Authority Circular No. 3 of 2023 of 18 May 2023 on procurement of Insurance Services.
15.Mr. Wachira has also sworn that the procuring entity has adequate internal technical capacity with requisite expertise and experience to undertake brokerage services and, therefore, it was not necessary for it to invite bidders for provision of these services. Further, in the event the 2nd Respondent requires brokerage services in future, it shall advertise for the same.
16.Both the applicant, on the one hand, and the respondents, on the other hand, agree on what I consider to be facts material to the instant application. These facts are that the procuring entity floated a tender for provision of insurance services. The applicant contested the tender by way of a request for review which it filed before the 1st respondent under section 167(1) of the Public Procurement and Asset Disposal Act which reads as follows:The Request for review was dismissed.
17.In considering the applicant’s case, my attention has been drawn to paragraph 6 of the applicant’s affidavit verifying the facts relied upon with specific reference to the case that was before the 1st respondent. In that paragraph the applicant swore that:
18.In the proceedings before the 1st respondent, the applicant submitted on what it regarded as “irregular and illegal qualifications” as follows:
19.On its part, the 1st respondent captured the applicant’s contentions and identified one main issue for determination as follows:The other issues was on who should bear the costs of the application.
20.In addressing the primary question, the 1st respondent considered the provisions of the Constitution, the Act and the Regulations. In particular, the 1st respondent considered section 58 of the Act which provides, inter alia, that an accounting officer of a procuring entity shall use standard procurement and asset disposal documents issued by the Public Procurement Regulatory Authority in all procurement and asset disposal proceedings; section 60 of the Act which enjoins an accounting officer of a procuring entity to prepare specific requirements relating to the goods, works or services being procured that are clear, that give a correct and complete description of what is to be procured and, in addition, allow for fair and open competition among those who may wish to participate in the procurement proceedings; and, section 70 on the Standard Form Documents issued by the Public Procurement and Asset Disposal Authority and which section 58 of the Act makes reference to. Still on the subject of standard form documents, the applicant considered regulation 68 of the Regulations on the nature and form of standard tender documents.
21.After considering these provisions, the 1st respondent concluded, among other things, that the law requires the Accounting Officer of a Procuring Entity in consultation with the relevant user departments to prepare the specific requirements in a Tender Document and that the requirements to be provided in such a document must give a correct and complete description of what is being procured.
22.With particular reference to the Constitution, the 1st respondent invoked Article 227 thereof and noted that the Constitution embraces fairness, equity, transparency, competition and cost-effectiveness as principles of public procurement. These principles, the 1st respondent noted, are replicated in section 3(b) of the Act.
23.The respondent then cited several authorities including decisions by this Honourable Court and appellate court on what discrimination entails. One of the decisions which the 1st respondent cited was its own decision in an application in which the party named as the applicant was the same applicant in the instant suit and, apparently, the applicant had challenged the procurement process on grounds similar to those in support of the instant application; that the requirements in the tender document had been orchestrated to lock the applicant out of the tender.
24.It is worth quoting here what the 1st respondent said at paragraph 69 of its decision. It noted as follows:
25.Upon analysing the court decisions and its own decisions on the same subject, the 1st respondent came to the conclusion that discrimination constitutes a failure to treat all persons equally without reasonable distinction and that discrimination which the Constitution does not allow is that which is unjustifiable and without any rational basis. The 1st respondent also held that not every differentiation amounts to discrimination and that for a claim on the ground of discrimination to succeed, the claimant must provide proof there is either direct or indirect discrimination.
26.Further, where a Procuring Entity has a legitimate reason in stipulating a specified requirement in its Tender Document, this does not constitute discrimination. And where a Tender Document permits suppliers to submit their bids under joint ventures, an interested supplier cannot claim that a tender requirement is discriminatory simply because the supplier finds difficulty in complying with the specified requirement. With this analysis, the 1st respondent considered each of the requirements in the tender document that the applicant alleged to be discriminatory and determined what they entailed.
27.On the specific question whether the procuring entity required the services of insurances brokers, the 1st respondent noted that they did not require such services and in so determining, the 1st respondent accepted the submissions of the procuring entity’s counsel. The 1st respondent held as follows:
28.The 1st respondent further considered circular no. 03/2023 to which reference has been made by the applicant and came to the conclusion that the tender requirements were consistent with the circular and, in any event, it had not been suggested that that the requirements in the Tender Document varied with the provisions of the Insurance Act or other applicable laws. The 1st respondent then concluded that the requirements in the tender document were not discriminatory and, in particular, they were not in breach of the Constitution, the Act and the Regulations.
29.I have reproduced parts of the 1st respondents decision as much as they are relevant to these two important points; first, that the 1st respondent addressed itself to all the issues with which it was presented in the applicant’s request for review and, second, that that it is the same issues and arguments that the applicant has escalated to this Honourable Court for the court’s determination. As much as the applicant’s application is stated to be based upon the judicial review grounds of illegality and procedural impropriety, the applicant appears aggrieved not necessarily by the process by which the impugned decision was reached but by the decision itself and to that extent it has, in no uncertain terms, urged this Honourable Court to weigh in on the merits of the 1st respondent’s decision. For the avoidance of doubt, it has been submitted on behalf of the applicant as follows:
30.So, the applicant is clear that rather than consider the process by which the decision was reached, this Honourable Court ought to dwell on the merits of the decision. The question I am faced with, therefore, is whether as a judicial review court, the court has the jurisdiction to take the path that the applicant wants it to take.
31.Sicpa SA v Public Procurement Administrative Review Board & 2 others (Civil Appeal E474 of 2024) (2024] KECA 939 (KLR) which the applicant has cited in support of the argument for consideration of the merits of the 1st respondent’s decision is a case I decided before it was escalated to the Court of Appeal. In that case, both this Honourable Court and the Court of Appeal addressed the same question on the limits of a judicial review court entertaining merits of an impugned decision. No doubt, it is for this reason that the applicant has found it a proper case to augment its position.
32.To the extent that it is relevant to the question at hand, I will adopt my reasoning in in that case in this judgment. I begin by saying that weighing on the merits of the 1st respondent’s decision would, to a greater degree, involve evaluation of the evidence and coming to my own factual conclusions. To be precise, I cannot come to the conclusion that restricting the tender to insurers or underwriters to the exclusion of insurance brokers was a proper decision for the procuring entity to make without inquiring into the evidence of whether insurance services can be provided independent of insurance brokerage services. Secondly, and more importantly, it will require me to look beyond the decision of the 1st respondent and interrogate the procuring entity’s decision to prescribe certain requirements in the tender document as necessary requirements to be complied with by the prospective tenderers. If I was to do take this direction, I would, in effect, be assuming jurisdiction which I do not have. Section 175 (1) of the Act, is categorical that it is the 1st respondent’s decision that would be subject to judicial review and not the procuring entity’s decision. This section reads as follows:(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. (Emphasis added).
33.For these reasons, I would be reluctant to assume appellate jurisdiction in an application that has been camouflaged as a judicial review application. I reject the invitation by the applicant to evaluate the evidence afresh and make my own factual findings. I also reject the invitation by the applicant to interpret the law differently from the interpretation given to it by the 1st respondent with a view to substituting the latter’s decision with my own. That is not the province of a judicial review court.
34.As I noted in the Sicpa case (supra), judicial review is more about the interrogation of the process of reaching a decision rather the merits of the decision. If this was not the case, there would be no need for distinguishing appellate jurisdiction from judicial review jurisdiction.
35.One of the cases that is oft-cited in arguing that the scope of judicial review has expanded and, apparently, the breadth to which a judicial review court can now go in interrogation of the merits of a decision, in the wake of the enactment of the Fair Administrative Action Act, 2015, is the Supreme Court case of Saisi & 7 others v Director of Public Prosecutions & 2 others (Petition 39 & 40 of 2019 (Consolidated)) [2023] KESC 6 (KLR) (Civ) (27 January 2023) (Judgment). In that case the court held as follows:
36.In what I suppose was the Supreme Court’s emphasis that a judicial review court ought not be tempted to interrogate the merits of the impugned decision, the court noted at paragraph 76 of its decision as follows:
37.This is the position the Court of Appeal adopted in an earlier decision of Energy Regulatory Commission v S G S Kenya Limited & 2 others (2018) eKLR Civil Appeal No. 341 of 2017 where it held as follows:
38.The court further cited its own decision 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 where it was held:
39.At the risk of sounding repetitive, I noted in Sicpa case (supra) that a judicial review court will not let every decision pass only because its jurisdiction is limited to interrogating the process rather than the merits of a decision. Where it is obvious and apparent on the face of the record that the decision cannot be justified on the basis of the material presented before the subordinate court or tribunal or any other public body whose decision is the subject of judicial review proceedings, the court will not fold its hands and sit back on the pretext that it is only concerned about the process. A decision that is glaringly unsupported by the evidence or blatantly contrary to law will be impeached. In such a case, the decision will not stand, not necessarily because it is unmerited but because it is impeachable on grounds of illegality or irrationality, as the case may be. It would be the kind of decision that no reasonable tribunal, given the same facts or circumstances, would reach.
40.In Biren Amritlal Shah & anor vs. Republic & 3 others (2013) eKLR the Court of Appeal did not rule out the possibility of interfering with the decision of a tribunal in judicial review proceedings albeit in very exceptional circumstances. In that case it was held:
41.In my opinion, having considered all the issues represented in the material with which it was supplied, any other person, would, in all probability have reached the same decision that the 1st respondent reached. The responded not only considered the evidence before it but it also interpreted and applied the law as it understood it. Of course, whether this court agrees with the 1st respondent’s evaluation of the evidence and interpretation of the law is not a relevant question.
42.One other decision that is worth of mention is the Supreme Court’s decision in Dande & 3 others v Inspector General, National Police Service & 5 others (Petition 6 (E007), 4 (E005) & 8 (E010) of 2022 (Consolidated)) [2023] KESC 40 (KLR) (16 June 2023) (Judgment) in which the court held that in a case where it is alleged that fundamental rights have been violated, the court has a lee-way of interrogating the merits of the decision. The Court held as follows:
43.Thus, when a party approaches a court under the provisions of the Constitution, no doubt, by way of a constitutional petition, the court is under an obligation to undertake a merit review of the case without any limitation. On the other hand, in the case where a party brings a judicial review suit under the provisions of Order 53 of the Civil Procedure Rules, the court is restricted to the process and manner in which the decision complained of was reached and not the merits of the decision. I note, in his submissions, counsel for the applicant appreciates this distinction and has submitted thus:
44.With due respect to the learned counsel, I understand the Supreme Court to say that the dual approach applies only in circumstances where one has a choice to make between filing a judicial review application or a constitutional petition. A tribunal such as the 1st respondent, or any other tribunal for that matter, is deficient of either of these jurisdictions. In other words, a tribunal would not entertain a judicial review application or a constitutional petition. And even if the applicant was to argue that he has alleged contravention of several provisions of the Constitution, what is before court is a judicial review application and not a constitutional petition.
45.For reasons I have given, I am not satisfied that there is any merit in the applicant’s application. It is hereby dismissed with costs. Orders accordingly.
SIGNED, DATED AND UPLOADED ON THE CTS ON 18 OCTOBER 2024 NGAAH JAIRUSJUDGE