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Court of AppealAllowedCivil Appeal No. 24 of 2017

Rentco East Africa Limited, Lantech Africa Limited, Toshiba Corporation Consortium v Public Procurement Administrative Review Board & another [2017] KECA 395 (KLR)

Court of Appeal of Kenya
28 July 2017
10,443 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~42 min to read original · ~4 min brief

The bottom line

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Kenya's Court of Appeal confirmed that a government body cannot ignore a binding procurement ruling — KenGen's tender termination was void and the bidder won.

What this practically means

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Executive summary

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The Court of Appeal at Nairobi (Makhandia, Ouko & Murgor, JJ.A) allowed the appellant consortium's appeal against a judgment of Odunga, J of 20th December 2016 which had quashed, by certiorari, a decision of the Public Procurement Administrative Review Board. The dispute arose from KenGen's Tender KGN-GRD-09-2015 for leasing 50 MW wellhead geothermal power generation units, awarded to the appellant after the Board dismissed OJSC Power Machines' first Request for Review and the High Court dismissed OJSC's judicial review. While leave in that judicial review operated as a stay, and pending the Board's binding decision, KenGen terminated the tender award. The appellant's second Request for Review succeeded before the Board, which declared the termination null and void and directed completion of the procurement process; the High Court quashed that decision on the narrow ground that the Request was filed outside the 7-day limitation period. The Court of Appeal held that the Board's first decision and the interim stay orders bound KenGen, that its termination was ultra vires and a nullity, and that no limitation period could attach to a challenge to a void act. The Court restated the scope of certiorari, prohibition and mandamus, criticised the learned Judge for deciding the case on limitation alone without addressing the judicial review parameters, and noted the post-2010 shift towards merit review under the Fair Administrative Action Act. It also condemned KenGen's about-turn as an abuse of process. The Court set aside the High Court judgment, reinstated and upheld the Board's decision of 24th March 2016 under section 173(b) of the Public Procurement and Asset Disposal Act, 2015, and awarded the costs of the appeal and of the High Court to the appellant, to be paid by KenGen.

Key legal issues

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01

Effect of the leave-stay orders and the Board's first decision on KenGen's power to terminate the tender

Holding

The Board's first decision that the award to the appellant was proper, read with the interim stay orders of Mumbi Ngugi, J, bound KenGen; its termination of the tender was of no legal effect and a nullity.

Reasoning

The Board had found no flaw in the evaluation and directed the procuring entity to proceed with the procurement process, which in context meant concluding the transaction with the appellant. The interim orders stayed implementation and/or execution of any contract concerning the tender, binding the world at large. The termination was therefore without jurisdiction, admitted as such by KenGen's counsel, and being a nullity, no limitation period could attach to a challenge to it.

p. 11
02

Jurisdiction of the Review Board over a late Request for Review against a void act

Holding

Because the termination was a nullity, the Board had jurisdiction to entertain the appellant's Request for Review irrespective of when it was filed.

Reasoning

The High Court held the Request for Review filed on 4th March 2016 was out of the 7 days prescribed by Regulation 73(2)(c)(i) of the 2006 Regulations, divesting the Board of jurisdiction. The Court of Appeal disagreed: where the triggering act is void and non-existent in law, no timeline could attach to a complaint arising from it. The Board therefore had jurisdiction under section 28 of the 2015 Act and Regulation 40.

p. 11
03

Misdirection by the High Court in confining itself to the limitation question

Holding

The learned Judge erred in deciding the case solely on limitation without considering whether the parameters of certiorari, prohibition and mandamus were met.

Reasoning

Citing Kenya National Examinations Council v Republic Ex parte Geoffrey Gathenji Njoroge, the Court restated the scope of the three judicial review orders and held the Judge was required to consider the availability of each order sought. The Judge also failed to consider the post-2010 shift towards merit review under the Fair Administrative Action Act, and ran contrary to his own approach in the OJSC judicial review decided a month earlier.

p. 8
04

Abuse of process by the procuring entity's change of position

Holding

KenGen's about-turn, having vehemently defended the award to the appellant before the Board and the High Court, undermined the administration of justice and amounted to abuse of the court process.

Reasoning

KenGen had sworn detailed affidavits demonstrating the appellant's selection was on merit and supported the award in Review No. 38 of 2015 and Judicial Review No. 284 of 2015. It could not renege on that position; doing so showed contempt for binding decisions of the Board and the High Court and promoted impunity, justifying the Board's intervention.

p. 15

Legal principles established

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  • A decision of the Review Board, in the absence of an appeal or review, is final, and a party which disobeys the decision of the Review Board, the High Court or the Court of Appeal acts in breach of the Act and any such contrary action is null and void.
  • An act done without jurisdiction is a nullity in law, requiring no order of court to set it aside, and no limitation timeline can attach to such a non-existent act.
  • The Review Board is a specialized statutory tribunal with very wide, appellate-type powers, better equipped than the High Court to handle procurement disputes; its decisions within its jurisdiction should not be lightly interfered with.
  • An order of stay of execution granted on leave in judicial review is a conservatory remedy under Article 23(3)(c) of the Constitution, operating in rem to keep the subject matter in situ pending final determination, and binds the world at large.
  • Under the Constitution of 2010 and the Fair Administrative Action Act, judicial review has shifted to include aspects of merit review through proportionality, rationality and reasonableness, though the reviewing court may not substitute its own decision for that of the administrator.
  • A party to proceedings cannot make particular submissions to achieve a result and then change its position once that result is achieved; such an attempt is an abuse of process.

Court orders

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  1. 1.Appeal allowed
  2. 2.Judgment of Odunga, J delivered on 20th December 2016 set aside
  3. 3.The quashed decision of the Public Procurement Administrative Review Board made on 24th March 2016 reinstated and upheld pursuant to section 173(b) of the Public Procurement and Asset Disposal Act
  4. 4.Costs of the appeal and those before the High Court awarded to the appellant, to be paid by the 2nd respondent
On appeal from
High Court of Kenya at Nairobi
H.C.J.R. No. 154 of 2016 (High Court Civil Appl. No. 15 of 2016)
Jurisdiction invoked
Section 3A and rule 29 of the Court of Appeal Rules; appeal against a High Court judicial review decision

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Rentco East Africa Limited, Lantech Africa Limited, Toshiba Corporation Consortium v Public Procurement Administrative Review Board & another [2017] KECA 395 (KLR)", Case Analysis (2017). Civil Appeal No. 24 of 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2017/395/eng@2017-07-28

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.