Central Bank of Kenya & another v Okiya Omtatah Okoiti & 6 others [2018] KECA 260 (KLR)
The bottom line
#Kenya's Court of Appeal upheld the CBK's currency printing tender award to De La Rue, dismissing activist Omtatah's constitutional challenge while sparing him costs.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether the appeals ought to be struck out for want of joinder of essential or necessary parties
- 2.The applicable law to the tender (PPDA 2005 or PPADA 2015)
- 3.Whether the 15% preference margin was lawfully granted to the 2nd appellant
- 4.Costs
Key legal issues
#Joinder of necessary parties to the appeal
The appeals were properly constituted; all persons named by the 1st respondent in his petition were served and participated, and in any event the strike-out application was time-barred under rule 84.
Rule 77(1) requires service of the notice of appeal on all persons directly affected. Here it was the 1st respondent who chose the parties to the petition; all of them were enjoined and participated in the appeal. He could not profit from his own omission by complaining that non-bidders such as Crane AB were not served. Further, rule 84 bars a strike-out application more than thirty days after service of the notice or record of appeal.
The applicable procurement statute to the tender
The applicable law was the PPADA 2015, not the repealed PPDA 2005; the Judge's contrary finding had no rational basis.
The impugned tender was issued on 24th October 2017 to prequalified candidates and was a stand-alone restricted tender under section 93 of the PPADA, read with the Third Schedule (a proceeding commences when the first advertisement is published or, if none, when documents are first given). The tender documents themselves referred to the PPADA, and both the Review Board and the same Judge in Judicial Review Nos. 6 and 7 of 2018 had found the PPADA applicable. The Judge's reliance on the 2014 pre-qualification advertisement to found PPDA jurisdiction was untenable.
Lawfulness of the 15% preference margin granted to De La Rue International
The margin was lawfully applied under section 155(3) of the PPADA on the basis that goods would be partially produced or assembled in Kenya through local affiliates, and sub-contracting was permitted under Addendum No. 3.
The 2nd appellant never claimed citizen-contractor status; the preference was grounded on local manufacture/assembly through its Kenyan affiliates. Addendum No. 3 was legitimately issued in response to bidders' clarifications before bids were made and allowed sub-contracting with the procuring entity's express authority, which was obtained and approved. In a specialized and complex procurement, eligibility for preference and consent to sub-contract could properly be sought before award. Allegations of rigging or collusion were unproven.
Reliance by the High Court on expunged tender documents
The Judge contravened Article 50(4) of the Constitution and misdirected himself by considering expunged documents; without them the petition failed.
Having himself expunged the tender documents as irregularly obtained, the Judge nowhere indicated that he discounted them, and the Court was satisfied he relied on them. The binding Supreme Court decision in Njonjo Mue precludes any consideration of expunged documents; a lower court cannot declare that decision per incuriam. Reliance on them vitiated the judgment.
Costs in public interest litigation
The 1st respondent, though unsuccessful, was not penalised in costs because the petition was bona fide public interest litigation; each party to bear its own costs.
Allegations that the 1st respondent litigated on behalf of Crane AB were unproved. Public interest litigation tends to be exempted from costs awards (Jasbir Singh Rai; Biowatch principle), and the petition, though unsuccessful, was neither frivolous, vexatious nor malicious.
Legal principles established
#- Once documents have been expunged from the record, a court cannot consider or be led by them, per the binding Supreme Court precedent in Njonjo Mue & Another v Chairperson of IEBC
- The Court of Appeal is bound by Supreme Court decisions and cannot declare them per incuriam
- A procurement proceeding commences when the first advertisement relating to it is published; but a restricted tender issued to prequalified candidates under section 93 of the PPADA is a distinct proceeding governed by the law in force when the tender documents were issued
- An affidavit made in one proceeding is admissible in a subsequent proceeding against the party who made it; withdrawal of a suit does not withdraw the evidentiary value of affidavits filed in it
- A strike-out application under rule 84 cannot be brought after the expiry of thirty days from service of the notice of appeal or record of appeal
Court orders
#- 1.The Judgment and Decree of the High Court in Petition No. 597 of 2017 dated 9th April 2018 is set aside
- 2.The said petition is dismissed
- 3.No order as to costs in respect of the proceedings both in the High Court and in this Court
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- High Court of Kenya at Nairobi
- Petition No. 597 of 2017
- Jurisdiction invoked
- First appeal to the Court of Appeal under the Court of Appeal Rules (rule 29 mandate to re-evaluate evidence); appeal against High Court judgment in constitutional petition
- Consolidated with
- Civil Appeal No. 119 of 2018
Relief refused
#Striking out of the appeal for want of joinder of bidders (Crane AB, Oberthur Fiduciaire, Giesecke & Devrient)
All parties named by the 1st respondent were enjoined; in any event rule 84 bars a strike-out application brought more than thirty days after service of the notice or record of appeal
Declaration that the tender award was unconstitutional and unlawful and order to re-evaluate bids
Petition failed; the Judge relied on expunged documents and misdirected himself on the applicable law, so the High Court judgment was set aside
Costs
No order as to costs in respect of the proceedings both in the High Court and in this Court (each party to bear own costs); the 1st respondent was not penalised in costs as the litigation was genuine public interest litigation
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
On the whole, the appeal succeeds. The Judgment and Decree of the High Court in Petition Number No. 597 of 2017 dated 9th April, 2018 is hereby set aside and substituted with an order dismissing the said petition with no order as to costs in respect of the proceedings both in the High Court and in this Court.
Upon the documents being expunged, the petition, in our view, had no legs left to stand on.
It is not for us nor is it our place to declare decisions of the Supreme Court, per incuriam. We are bound by such decision, although we may at times not agree with them.
The departure of the Judge from that position and to revert to the PPDA in determining the impugned decision, therefore, has no rational explanation or basis.
Having initiated the petition and named the parties who all have been enjoined in this appeal, the 1 st respondent cannot turn around and blame the appellants for not bringing into the appeal parties he himself felt would not be affected by his petition.
From the above provision, the 1st respondent is barred from applying to strike out the appeal at this stage.
The litigation undertaken in this case by the 1 st respondent though unsuccessful in this Court cannot be termed as frivolous, vexatious or malicious.
Issues in the judgment
#The judgment alternately dates commencement of the PPADA as 7th January 2016 and 7th January 2017 in different passages
The withdrawn petition is referred to variously as Nairobi HC Petition No. 568 of 2017 and No. 578 of 2017
The tender issuance date appears as both 24th October 2017 and 17th October 2017
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Central Bank of Kenya & another v Okiya Omtatah Okoiti & 6 others [2018] KECA 260 (KLR)", Case Analysis (2018). Civil Appeal No. 116 of 2018. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2018/260/eng@2018-10-12
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.