Sanral in court over tender

The Toll Collect Consortium has applied to the Durban High Court for a review of a decision by the SA National Roads Agency Limited (Sanral) to award Tolcon Lehumo a contract for the operation and maintenance of the N2 South Coast Toll Plazas in the province. Toll Collect has argued it was the cheapest bidder but Sanral disputes this, saying that value added tax was not added to Toll Collect’s bid, which it claims it was entitled to correct, and therefore awarded the contract to Tolcon. But Toll Collect maintains that the price it bid for either the five-year or the eight-year contract already included VAT.

The local company seeks an order for Sanral to reconsider the award of the contract and for the officials who originally adjudicated to be excluded from the reconsideration process. Both parties argued earlier this month before Durban High Court Judge Rashid Vahed, whose judgment is expected in the next few weeks. Tolcon, listed as the second respondent, has not opposed Toll Collect’s application. According to court papers, the bids were opened at a meeting on April 15 last year. When Sanral awarded the tender to Tolcon, Toll Collect requested reasons for this decision. Sanral at first said Tolcon’s bid was cheaper than Toll Collect’s.

Roads agency later said Toll Collect failed to achieve 75 percent and above in the evaluation for quality because of its inexperience in toll operations. It contended that Toll Collect had not submitted certain documents for the tender, in particular its BEE verification certificates. Toll Collect then asked for a copy of the record to explain how the evaluation of tenders was made and how the alleged point scores had been arrived at. Sanral eventually provided copies of a tender evaluation report dated May 2011. The report stated that Sanral was of the view that they should correct Toll Collect’s price by adding VAT to the amount tendered. It referred to Toll Collect falling short of the threshold in its quality assessment.Toll Collect’s senior counsel, Durban advocate PJ Olsen, instructed by Cox and Yeats Attorneys, had argued that when the tenders were opened Sanral clearly recorded that Toll Collect’s price for the eight-year contract option was just over R156 million. This amount, Olsen said, was referred to in its bid which also stated that the total price was inclusive of VAT. “Despite this clear offer, the authors of the evaluation and bid reports nevertheless deemed it appropriate to correct (Toll Collect)’s price by adding VAT to the total,” read Toll Collect’s court papers. Olsen argued that Sanral had the option to contact Toll Collect for verbal confirmation or clarity that its price included VAT. “A decision to correct (Toll Collect’s) price without seeking clarification from (it) rendered the process not fair and contrary to the constitution,” he said.

Sanral’s senior counsel, Sandton advocate BE Leech, argued that this application discloses no reviewable irregularity that warrants the setting aside of the tender award. “(Toll Collect) is little more than a disgruntled tenderer appealing to the court to re-assess and re-score the tenders in the vain hope that (it) will fare better second time around,” Leech said and called for the application to be dismissed. He maintained that Toll Collect could never have been awarded the tender because it did not score 75 percent or more on the quality assessment and therefore “has no interest in who was awarded the tender”.

He further argued that Sanral appointed an independent consulting engineer, Tolplan, to assist in the adjudication of the tender submissions. Tolplan compiled an evaluation report to submit to the tender evaluation committee that performed its own evaluation before awarding the tender. Toll Collect did not score above the threshold, he said, so it was not considered further.