Tug tenderer gets nod to sue Namport

Werner Menges

A TENDERER whose bid to supply a new tugboat for the Walvis Bay harbour was not accepted by the Namibian Ports Authority could now sue the State-owned harbour operator for damages.

The unsuccessful tenderer, Centani Investment CC, was given permission to sue Namport for damages in a judgement delivered in the Windhoek High Court this week.

In the judgement, Judge Shafimana Ueitele declared that the award of a tender to supply a new tugboat for the Walvis Bay harbour to a South African shipbuilder, Damen Shipyards Cape Town, was unlawful and irregular.

Judge Ueitele, however, decided not to set aside the decision to award the tender to the company.

Centani Investment CC had a constitutional right to participate in a procurement process that was fair, equitable, transparent, competitive and cost-effective, the judge said in his judgement. He found that the close corporation’s right to fair administrative action had been infringed when Namport’s top management decided not to accept a recommendation to award the tugboat tender to Centani Investment.

The Namport board instead relied on a report by former Walvis Bay port captain Mike van der Meer, who recommended that the tender of Damen Shipyards Cape Town be accepted, when it decided in August 2011 to award the tug supply contract to the company.

Centani Investment offered to deliver a new tug to Namport at a cost of N$85,1 million. At N$50,9 million, Damen Shipyards Cape Town’s tender price was N$34,1 million less than Centani Investment’s.

After receiving a recommendation on the tender from Namport’s tender committee, the parastatal’s executive committee decided in May 2011 that the tender should be awarded to Centani Investment, Judge Ueitele recounted events around the disputed tender in his judgement.

However, with a financial executive and Namport’s chief executive officer not satisfied with the tender board’s evaluation of the tenders and the executive committee’s decision, it was decided to get Van der Meer to evaluate the tenders again.

Namport’s board accepted a procurement policy in April 2006, the judge noted. In terms of that policy, a tender committee was established, with the making of recommendations on the award of tenders stipulated as one of its functions. Based on that policy, Namport’s board can only act on the recommendations of the tender committee and the executive committee, Judge Ueitele reasoned.

Van der Meer and a Namport manager who was also involved in the re-evaluation of the tenders after the initial decision to award the contract to Centani Investment had no power to make any recommendation to the executive committee and the committee could therefore not lawfully accept any recommendation other than that of the tender committee, Judge Ueitele stated.

Namport has gone ahead and implemented its tender decision while Centani Investment sued the parastatal in the High Court. With the tug-boat supplied by Damen Shipyards Cape Town delivered in the meantime, Judge Ueitele said that in his view it would not only have been disruptive to now set aside the tender but would also have been totally impractical and would give rise to a host of problems.

As a result of this, the court was required to be innovative to minimise and injustice, he remarked.

He also indicated that it has been accepted that Centani Investment’s financial loss would relate mainly to the profit it would have realised on a contract to supply the tug.

Centani Investment was represented by senior counsel Vas Soni, instructed by Lucius Murorua. Esi Schimming-Chase and senior counsel Theo Frank, instructed by the firm Kirsten & Co Inc, represented Namport.