Thursday, 29 May 2008

PROVISIONS OF PUBLIC PROCUREMENT AND DISPOSAL ACT 2005 OVERTUNED

By DAVID MUTUNGA

Republic v Public Procurement Administrative Review Board and
another Ex parte Selex Sistemi Integrati [2008] eKLR
(www.kenyalawreports.org )

 High Court, at Nairobi

 Nyamu J

 May 2, 2008

 The High Court has overturned the provisions of the Public
Procurement and Disposal Act, which provide that if a party is
dissatisfied with the decision of the Public Procurement
Administrative Review Board and prefers to challenge the same through
Judicial Review, that Review should be determined within thirty days.

 Selex Sistemi Integrati participated in a tender which had been
announced by Kenya Civil Aviation Authority and which the Authority
cancelled before the results of the tender had been announced.
Aggrieved by the decision of the Civil Aviation Authority to
terminate the tender without giving reasons for the decision to
terminate the tendering process, Selex Sistemi lodged an appeal for
administrative review with the Public Procurement Administrative
Review Board challenging the Civil Aviation Authority's decision. The
Board upheld the decision of the Aviation Authority by stating that
the Authority was right in terminating the tendering process.

 Jurisdiction

 Section 36 of the Public Procurement and Disposal Act 2005 provides
that a procuring entity may at any time terminate procurement
proceedings without entering into a contract and that such
termination shall not be reviewed by the Review Board or a Court.The
Act further states under section 100(4), that if judicial review is
not declared by the High Court within thirty days from the date of
filing, the decision of the Review Board shall take effect.

 Selex Sistemi on 20th December 2007 made an application for Judicial
Review challenging the decision of the Public Procurement
Administrative Review Board in which the Board upheld termination of
the procurement proceedings.

 When the application for judicial review came up for hearing the
Court's attention was drawn to a Notice of Preliminary Objection made
by the Civil Aviation Authority that the court had no jurisdiction to
hear a judicial review application, which had not been determined
within thirty days and further that the limitation clause was put in
the Public Procurement and Disposal Act to ensure speedy
determination of Public tendering process. Further the Civil Aviation
Authority contented that speedy determination of the public tendering
process was in the nature of public interest and therefore the court
was bound by the provisions of the Act limiting the time frame within
which the court could determine an application for judicial review
arising from the Public Procurement and Disposal Act.

 Selex Sistemi opposed the objection on grounds that section 36(1),
(6) and section 100(4) of the Public Procurement and Disposal Act
2005 was defective and unconstitutional as neither the Law Reform Act
and order 53 of the Civil Procedure Act which govern applications for
judicial review nor the Constitution puts a time limit on the High
Court within which to determine an application for judicial review.
Selex Sistemi contented that determination of judicial review
proceedings within thirty days in the instant case was impracticable
and as such section 100(4) does not apply to situations where it is
impracticable to complete judicial review proceedings within thirty
days.

 Issues

 The court was faced with the challenge of determining whether
section 100(4) Public Procurement and Disposal Act 2005 ousts the
jurisdiction of the court in judicial review, whether the said
section is therefore unconstitutional and whether the public interest
of finality in procurement procedures outweigh judicial adjudication.

 In a 58 page ruling Justice Nyamu stated that judicial review plays
an important role in our society which is to check excesses,
omnipotence, arbitrariness, abuse of power and also accountability
and maintenance of constitutionalism and the rule of law. In
reiterating the words of an American Chief Justice Marshall in the
celebrated case of Marbury v Madison, Justice Nyamu stated that
judicial review provides the best means of enforcing the peoples will
as declared in the Constitution without resort to drastic remedy of
Revolution. Without judicial review, the legislative branch would
enjoy a practical and real omnipotence and would reduce to nothing
what is deemed the greatest improvement on political institutions- a
written constitution. He stated that the High Court has jurisdiction
to review legislation in order to establish whether it complies with
the Constitution, and further that judicial review enables the High
Court to review acts, decisions and omissions of public authorities
in order to establish whether they have exceeded or abused their
power.

 Justice Nyamu said that the Constitution from where the Court
derives its judicial review powers is the supreme law of the land and
if any other law is inconsistent with the Constitution that law shall
to the extent of the inconsistency be void. He stated that section 36
(6) of the Public Procurement and Disposal Act 2005 purports to oust
jurisdiction of the Court that had been granted by the constitution
to determine all matters of judicial review. He further noted that
section 100 (4) of the Public Procurement and Disposal Act 2005
authorised challenge of the Review Board's decisions by way of
judicial review yet at the same time imposing a time bar within which
the Court can express its opinion.

 Justice Nyamu stated that Legislative provisions that suggest a
curtailment of the courts' power of review, give rise to a tension
between the principle of legislative mandate and the judicial
fundamental of access to courts.Judges must search for critical
balance and deploy various techniques in trying to find it. The Court
has to look into the ouster clause as well as the challenged decision
to ensure that justice is not defeated.He further stated that
statutory provisions tending to oust the jurisdiction of the Court
should be construed strictly and narrowly.

 Justice Nyamu stated that though the intention of the Public
Procurement and Disposal Act 2005, of efficiency and speed in
determination of Public procurement is fundamental, the court must
put all public interest considerations in the scales other than
finality and efficiency considerations. He stated that fairness,
transparency and accountability were core values of our modern
society and could not be sacrificed at the altar of finalising the
public procurement decisions. He stated that the court must look into
each and every case and its circumstances and balance the public
interest with that of a dissatisfied applicant.

 Justice Nyamu held that speed is the hallmark of judicial review as
leave to make application for judicial review is filed under
certificate of urgency, and therefore finality is the very nature of
judicial review.

 As to whether section 100 (4) of the Public Procurement and Disposal
Act 2005 was unconstitutional, Justice Nyamu stated that the
constitution envisages hearing of a case within a reasonable time
with due regard to practicality.A reasonable time is not defined but
it is an issue of construction by the judge who presides over a
case.A reasonable time would depend on the circumstances of the case
and other relevant factors that the court must consider. He stated
that due to the backlog, the judge/population ratio, the thirty days
stated under section 100 (4) is not reasonable in Kenya.

 The judge stated that section 100 (4) of the Public Procurement and
Disposal Act 2005 offends provisions of section 77 (9) of the
constitution which provides what a reasonable time should be for any
judicial task or function. He stated that the legislature by
providing that the Courts must hear and determine a judicial review
case within thirty days and the enthusiastic implementation of the
same by the executive was a deliberate encroachment to the strictly
operational independence of the judicially which is an independent
arm of the government and therefore section 100(4) was
unconstitutional.

 The judge ruled that ouster clauses which attempt to prevent the
judicial determination where the targeted body has no jurisdiction or
acted in excess of jurisdiction are incapable of ousting judicial
review jurisdiction of the Court. He stated that for an ouster clause
to be effective, it should be clear and unambiguous and that section
100 (4) of the Public Procurement and Disposal Act 2005 was vague,
ambiguous and indefinite therefore incapable of ousting the
jurisdiction of the Court.

 Supremacy of the Constitution

 Justice Nyamu held that the Court cannot blindly apply the so called
ouster clauses. He stated that unlike the English judges who must
always obey, or bow to what parliament legislates, because parliament
is the supreme organ in that legal system, in Kenya the Constitution
is supreme and the judges' first loyalty is to the Constitution and
in deserving cases the judge is at liberty to strike down laws that
violate the Constitution. He said that where jurisdictional issues
are involved ouster clauses, no matter how tightly worded would not
prevail and the court has the jurisdiction to declare any decisions
as nullities.

 The court in overruling the preliminary objection finally stated
that section 100 (4) of the Public Procurement and Disposal Act
purports to allocate judicial time in advance which constitute
usurpation of judicial function, and therefore unconstitutional. It
further stated that procurement matters are substantially contractual
and civil in nature and therefore the High court has unlimited
jurisdiction in both civil and criminal matters which cannot be
limited by the legislature or the executive by ouster clauses.

 Finally the court stated that it could have struck section 100 (4)
down for the reason that it is unconstitutional had a constitutional
application been made for that purpose.

 Download Case
<http://kenyalaw.org/Downloads_FreeCases/Procurement_Act_and_court_calendar.pdf>

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