Background
1. The Application before this Court is the Applicant’s Notice of Motion application dated 8th October, 2024 brought under Under Sections 8 and 9 of the Law Reform Act, Cap 26, Sections 7, 8, 9, 10 and 11 of the Fair Administrative Actions Act, Order 53 Rule 1 of the Civil Procedure Rules.
2. The application seeks the following orders;
i) An order of Certiorari to remove into the High Court and quash the Respondent’s decision dated 24th September 2024 in Public Procurement Administrative Review Board’s Request for Review No. 87 of 2024 in respect of Tender No. SNSC/427D/2024/2025 for the Provision of General Insurance Services.
ii) An order of Mandamus directing the Respondent to hear and determine on its merits Request for Review No. 87 of 2024 in respect of Tender No. SNSC/427D/2024/2025 for the Provision of General Insurance Services.
iii) An order that costs of this application be borne by the Respondent and the Interested Parties.
3. The Application is supported by a statutory statement dated 4th October, 2024 and verifying affidavit sworn by George Olola on 4th October, 2024.
4. The Applicant’s case is that 2nd Interested Party invited bids for Tender No. SNSC/427D/2024/2025 for the Provision of General Insurance Services (hereinafter ‘the Tender’).
5. Prior to the tender the subject matter of this application, the Applicant had participated in the 2nd Respondent’s tender number SNSC/427B/2023/2024 for the provision of General Insurance Services. However, through a letter dated 4th July 2024, the 1st Interested Party informed the Applicant that the tender had been terminated due to what it termed as ‘detected material governance issues’.
6. On 9th July 2024, 2nd Interested Party re-tendered Tender No. SNSC/427D/2023/2024 for the Provision of General Insurance Services and on 25th July 2024, the 1st and 2nd Interested Parties issued an addendum in which it introduced a completely new tender document and extended the tender opening date from 26th July 2024 to 31st July 2024. The Applicant participated in the Tender and offered to provide the brokerage services at the tender sum of Kshs.45,058,755/-.
7. In light of the fact that the existing insurance covers were lapsing on 31st August 2024 and the 2nd Respondent had not concluded the tendering process, the Applicant being the holding broker wrote to the 2nd Respondent on 26th August 2024 requesting for instructions to extend the covers so as not to leave the 2nd Respondent exposed.
8. Through notification of intention to award dated 12th August 2024 and served upon the Applicant through EMS on 27th August 2024, the 1st Respondent informed the Applicant that its tender was unsuccessful for the reason that the Applicant’s tender failed to meet mandatory requirement by submitting a different referenced tender document.
9. The Applicant having being aggrieved by the decision proceeded to challenge the 1st Interested Party’s decision in Request for Review No. 87 of 2024 filed on 3rd September 2024. The Interested Parties filed their responses to the Request for Review which included a notice of preliminary objection challenging the Review Board's jurisdiction to hear and determine the Request for Review. parties filed their respective submissions on the Request for Review and the preliminary objection
10. In a decision delivered on 24th September 2024, the Respondent struck out the Request for Review on the following grounds;
a) The same was filed outside the 14 days’ statutory timelines stipulated under section 167 (1) of the Act read with Regulation 203 (2) (c) (ii) of Regulations 2020 and thus divested the Board of its jurisdiction to hear and determine the Request for Review, and
b) The contract dated 1st September 2024 was signed after the lapse of the standstill period provided under section 135 (3) of the Act is valid and accordingly, the Board is divested of jurisdiction to entertain the Request for Review by dint of section 167 (4) (c) of the Act.
11. The Applicant posits that in arriving at the impugned decision, the Respondent misinterpreted sections 87, 135 (3), 167 (1) and 167 (4) (c) of the Act as read with Article 227 (1) of the Constitution resulting to its improperly fettered discretion and failure to exercise its jurisdiction under section 173 of the Act and therefore acted ultra vires the Act. This is in contravention of Artifices 10, 47, 159 (d) and 272(1) of the Constitution of Kenya and the principles articulated under section 3 of the Act.
12. It is the Applicant’s case that the Respondent in striking out its Request for Review is unfair, unreasonable and violates the Applicant’s legitimate expectation contrary to under Article 47 of the Constitution and the Fair Administrative Action Act.
13. The Applicant deponed that The Respondent further held that the contract, signed by the 2nd and 3rd Interested Parties on 1st September 2024 was signed after the lapse of the standstill period provided under section 135 (3) of the Act, is valid and accordingly the Board is divested of jurisdiction to entertain the request for review by dint of the provisions of section 167 (4) (c) of the Act.
14. The Applicant further deponed that that the notification was posted on 13th August 2024 and therefore the time for filing the Request for Review started running on 14th August 2024 and lapsed on 27th August 2024.
15. The Applicant further argues that Respondent in arriving to it’s decision, failed to comprehend and misapplied the provisions of section 2 (3) of the Kenya Information and Communications Act as read with Regulation 3 of the Kenya Information and Communication (Postal and Courier) Regulations and erroneously came to the conclusion that the request for review was filed out of the 14-day statutory period and therefore time barred.
16. The Applicant avers that Respondent acted unreasonably within the Wednesbury’s principle of unreasonableness and also acted in error of fact in the interpretation of the Postal Waybill as to the date of service of the notification of award and in the end arrived at an unfair and unreasonable decision.
17. The Applicant filed written submissions dated 1st November, 2024 where they submit their application has merit and this court should thus grant it the Judicial review reliefs as sought. It makes reliance to the case of Council of Civil Service Unions v Minister for the Civil Service [1984] 3 ALL ER 935 where the court held: -
“Judicial review has I think developed to a stage today when without reiterating any analysis of the steps by which the development has come about, one can conveniently classify under three heads the grounds upon which administrative action is subject to control by judicial review. The first ground I would call "illegality," the second "irrationality" and the third "procedural impropriety…”
18. On the misinterpretation 87, 135 (3), 167 (1) and 167 (4) (c) of the Act as read with Article 227 (1) of the Constitution resulting in arriving at the impugned decision, the Applicant cites the case of Republic –vs- Public Procurement Administrative Review Board; Kenya Power & Lighting Company Limited (Interested Party) Ex Parte Transcend Media Group Limited [2018] eKLR, Nyamweya J, as she then was, held as follows on the meaning of error of law;
“In determining whether or not the 1st Respondent acted in error of law, regard is made to the description of illegality by Lord Diplock in Council of Civil Service Union v Minister for the Civil Service [1985] AC 374 at 410 as a failure by a public body to understand correctly the law that regulates its decision making power, or a failure to give effect to that law.”
19. The Applicant on whether the Review Board had jurisdiction submits that section 167 (1) of the Act. Section 167 (1) of the Act provides as follows;
“Subject to the provisions of this Part, a candidate or a tenderer, who claims to have suffered or to risk suffering, loss or damage due to the breach of a duty imposed on a procuring entity by this Act or the Regulations, may seek administrative review within fourteen days of notification of award or date of occurrence of the alleged breach at any stage of the procurement process, or disposal process as in such manner as may be prescribed.”
20. Thus the Applicant argues that the Respondent erroneously relied on Regulation 3 (a) (i) of the Kenya Information and Communication (Postal and Courier) Regulations as it argues that the notification of intention to award dated 12th August 2024 was delivered to the Applicant’s office on 27th August 2024. By dint of the provisions of section 57 of the Interpretation and General Provisions Act, the 14-day window under section 167 (1) of the Act commenced on 28th August 2024 and ended on 12th September 2024.
21. It is also its submission that it’s the request for review on 3rd September 2024 was within the fourteen (14) days period stipulated under section 167 (1) of the Act. In view of the foregoing and therefore the Respondent’s decision was an error of law and it cites the case of Public Procurement Administrative Review Board v Four M Insurance Brokers Limited & 3 others (Civil Appeal E1009 of 2023) [2024] KECA 79 (KLR) (9 February 2024) (Judgment), the Court of Appeal held as follows;
“We accordingly find that the time for filing the request for review under Section 167 (1) of the Act started running a day after the 28th September 2023 when the record reflects that the 2nd respondent became aware of the breach, and that the Request for Review was filed within the 14 days standstill period in consonance with Section 167 (1) of the Act read with Regulation 203 (2) (c) (iii) of Regulations 2020.”
22. The Applicant in its submissions also cites the case of African Merchant Assurance Co. Ltd (AMACO) v Public Procurement Administrative Review Board; Madison General Insurance Kenya Ltd & 2 others (Interested Parties) [2020] eKLR, where the Board held as follows;
“116. The import of the above decision of Justice Nyamweya is that (a) the trigger for purposes of entering into a procurement contract with the successful bidder is the giving/issuance of notification by the procuring entity, (b) the date of receipt of a notification is NOT a factor to be considered under Section 135 of the Act with respect to when a contract is to be executed by a procuring entity unlike in the case of filing a request for review application, and (c) the standstill period under section 135 of the Act starts running from the time of sending of the notification and not on receipt of the notification.”
23. The Applicant contends that the above decision is contrary to the spirit of S. 135 (3) of the Act as the purport of the said decision is to deny a tenderer the opportunity to challenge the decision of a procuring entity after the execution of a contract, which contract may have been executed in bad faith and to defeat the cause of justice. This is in violation of the provisions of the Fair Administrative Action Act and Article 47 of the Constitution.
24. The Applicant further submits that the correct interpretation of section 135 (3) of the Act is as held by the Review Board in its decision in African Merchant Assurance Co. Ltd (AMACO) v Public Procurement Administrative Review Board; Madison General Insurance Kenya Ltd & 2 others (Interested Parties) [2020] eKLR is:-
“This Board observes that one of the most important functions that a letter of notification serves is to enable an aggrieved tenderer to exercise its right to administrative review within fourteen (14) days from the date of receiving such letter of notification. The issuance of notification to bidders is not deemed to be the date of the letters of notification, but the date when bidders receive their respective letters of notification.
It is also required of a procuring entity to notify the successful and unsuccessful bidders of the outcome of their bids simultaneously, so that all bidders receive their respective letters of notification around the same time for the fourteen-day stand-still period to start running…”
25. It is the Applicant’s submission that the Respondent is bound by the stare decisis rule in as far as the decision in African Merchant Assurance case is concerned.
26. It is the Applicant’s submission that section 167 (4) of the Act to the Court of Appeal’s interpretation of section 167 (1) of the Act is envisaged in the case of Republic v Public Procurement Administrative Review Board & 2 others Ex-Parte Kemotrade Investment Limited [2018] eKLR where the court adopted test of discoverability and held as follows: -
“The answer then to the question when time started to run in the present application can only be reached upon an examination of the breach that was alleged by the 2nd Interested Party in its Request for Review, and when the 2nd Interested Party had knowledge of the said breach.”
27. It’s also the Applicants’ submission that if the execution of the contract complied with section 135 (3) of the Act, which is denied, the notification of intention to award dated 12th August 2024 was null and void ab initio for being in contravention of the provisions of section 87 (3) of the Act as read together with Regulations 82 (3) of the Regulations.
28. It further submits that The Board abdicated its mandate under section 28 (1) of the Act and fettered its jurisdiction.
29. Section 87 (3) of the Act enjoins the accounting officer of the procuring entity to disclose to all the unsuccessful tenderers the details of the successful tenderer and the tender price. The 1st Interested Party did not indicate in the notification dated 12th August 2024 the specific reasons why the Applicant was unsuccessful. The 1st Interested Party also failed to indicate in the said letter, who the successful tenderer was, the successful tenderer’s tender sum and the reasons why it was successful this is in contravention of the provisions of section 87 (3) of the Act and Regulation 82 (3). It cites the case of PPARB No. 55 of 2024; Lakeparm Cleaners Ltd -vs- Kenya University Teaching & Referral Hospital & 2 Others, wherein the Board held as follows;
“The above Notification Letter discloses that (i) the Applicant was unsuccessful in the subject tender and (ii) the reasons why the Applicant was unsuccessful.
However, the said letter fails to disclose the following details equally required under the Act and Regulations 2020 (i) the identity of the successful tenderer (ii) the tender price offered by the successful tenderer; and (iii) the reasons for the tenderer emerging successful.
From the foregoing the Notification Letter issued to the Applicant did not contain all the information contemplated under the Act and the Regulations…Accordingly, the Board finds that the Procuring Entity issued Notification Letters that were not compliant with Section 87 of the act and Regulations 82 of the Regulation 2020”
30. The Respondent failed to exercise its jurisdiction under section 173 of the Act and therefore acted ultra vires the Act and acted Unreasonable as defined by the Wednesbury’s principle of unreasonableness.
31. The Applicant thus submits that it’s application has merit prays that this honorable court to grant the prayers for certiorari and mandamus with costs.
The Respondent’s case;
32. In opposition to the Applicants’ Application, the Respondents filed a Replying Affidavit dated 1st November, 2024 sworn by James Kilaka and written submissions dated 5th November, 2024.
33. The Respondent deponed that the Applicant on 3rd September 2024, the Ex parte Applicant herein filed a Request for Review Application No. 87 of 2024 dated 3rd September 2024 before the Respondent (hereinafter “Request for Review No. 87 of 2024”) seeking the following orders:
a) An order annulling and setting aside the award of the Tender to ‘successful tenderer’, if any.
b) An order quashing the 1st Respondent’s decision contained in the letter dated 12th August 2024 declaring the Applicant’s bid unsuccessful.
c) A declaration that the Respondents unfairly evaluated the Applicant’s tender at the mandatory evaluation stage.
d) An order directing the Respondents to re-instate and re-evaluate the Applicant’s tender at the mandatory evaluation stage taking into consideration the Board’s directions in this application.
e) An order awarding costs of the request for review to the Applicant.
f) Any other relief that the Review Board deems fit to grant under the circumstances.
34. Thereafter the Respondent in exercise of the powers conferred upon it under the Public Procurement and Asset Disposal Act (hereinafter referred to as “the Act”) considered the parties’ pleadings, documents, written and oral submissions, the list and bundle of authorities together with the confidential documents submitted to the Board pursuant to Section 67(3) (e) of the Act and found the following issues called for determination:
a) Whether the Board has jurisdiction to hear and determine the instant Request for Review
In determining the first issue, the Board will make a finding on the following sub-issues:
i Whether the instant Request for Review was filed within the statutory period of 14 days in accordance with Section 167(1) of the Act read with Regulation 203(2)(c) of Regulations 2020 to invoke the jurisdiction of the Board.
ii Whether the contract dated 1st September 2024 between the Procuring Entity and the Interested Party was signed in accordance with Section 135(3) of the Act thus ousting the jurisdiction of the Board by dint of Section 167(4)(c) of the Act.
Depending on the determination of the first issue;
b) Whether the 2nd Respondent’s Evaluation Committee evaluated the Applicant’s tender in accordance with the provisions of the Tender Document as read with provisions of the Constitution, the Act and Regulations 2020;
c) What orders should the Board grant in the circumstances?
35. On 24th September 2024, further proceeded to make the following orders:
A. The Applicant’s Request for Review dated 3rd September 2024 and filed on even date be and is hereby struck out for want of jurisdiction.
B. Given our findings herein, each party shall bear its own costs in the Request for Review.
36. The Respondent avers that in determining the first sub-issue of the first issue as to whether Request for Review No. 87 of 2024 was filed within the statutory period of 14 days pursuant to Section 167(1) of the Act so as to invoke the Respondent’s jurisdiction, the Respondent noted that Section 167 of the Act read with Regulation 203 of Regulations 2020 identifies the benchmark events for the running of time to be the date of notification of the award or date of occurrence of the breach complained of.
37. The Respondent deponed that it took note of the issue in contention as to (i) postage of the letter of notification of the outcome of evaluation of the Applicant’s bid in the subject tender on 13th august 2024 as evidence by the Original EMS Shipment Waybill No. EE110047699KE submitted by the 1st Interested Party herein and (ii) allegation of receipt of the said letter by the Applicant on 27th August 2024. Additionally, the Respondent took cognizance of Regulation 3 of the Kenya Information and Communications (Postal and Courier Services) Regulations, 2010 that speaks to service of documents using the postal office.
38. The Respondent further depones that the it was it’s finding on a balance of probabilities, that the 1st and 2nd Interested Parties had demonstrated how and when the notification letter was transmitted and when time began to run for purposes of computing time as provided under Section 167(1) of the Act and therefore the Request for Review No. 87 of 2024 as filed was time barred.
39. It is the Respondents case that whether the contract dated 1st September 2024 between the 2nd and 3rd Respondent had been signed in accordance with Section 135(3) of the Act thus ousting the jurisdiction of the Respondent by dint of Section 167(4)(c) of the Act, that its finding and decision is within the doctrine of stare decisis within the confines of the Constitution, the Act, Regulations 2020, the Fair Administrative Actions Act and the rule of law in its findings in Request for Review No. 87 of 2024.
40. The Respondent avers that the Applicant has failed to demonstrate any elements of illegality, irrationality, procedural impropriety and/or unfairness in the manner in which the Respondent considered and interrogated the evidence, documents, pleadings, and information before it in arriving at its Decision in Request for Review No. 87 of 2024.
41. The Respondent submits that the Applicant has failed the I’s test as was found in the Pastoli v Kabale District Local Government Council and Others [2008] 2 EA 300 and has not also demonstrated how it acted ultra vires contrary to Section 173 of the Public Procurement and Asset Disposal Act and cited the case of Kenya Pipeline Company Limited case V Hyosung Ebara Company Limited & 2 Others [2012] Eklr where the Court pronounced itself as follows:
“The Review Board is a specialized statutory tribunal established to deal with all complaints of breach of duty by the procuring entity. By Reg. 89, it has power to engage an expert to assist in the proceedings in which it feels that it lacks the necessary experience. S. 98 of the Act confers very wide powers on the Review Board. It is clear from the nature of powers given to the Review Board including annulling, anything done by the procurement entity and substituting its decision for that of the procuring entity that the administrative review envisaged by the Act is indeed an appeal. From its nature the Review Board is obviously better equipped than the High Court to handle disputes relating to breach of duty by procurement entity. It follows that its decision in matters within its jurisdiction should not be lightly interfered with.
Having regard to the wide powers of the Review Board we are satisfied That the High Court erred in holding That the Review Board was not competent to decide whether or not the 1st Respondent’s tender had met the mandatory conditions. The issue whether or not the 1st Respondent’s tender was rightly rejected as unresponsive was directly before the Review Board and the Board had jurisdiction to deal with it.
In conclusion, it is manifest that the application for Judicial Review was not well founded. The 1st Respondent did not establish that the Review Board had acted without jurisdiction or in excess of jurisdiction or in breach of rules of natural justice or that the decision was irrational. The Judicial Review was not confined to the decision making process but rather with the correctness of the decision on matters of both law and fact. So long as the proceedings of the Review Board were regular and it had jurisdiction to adjudicate upon the matters raised in the Request for Review, it was as much entitled to decide those matters wrongly as it was to decide them rightly.
The High Court erred in essence in treating the judicial review application as an appeal and in granting judicial review orders on the grounds which were outside the scope of Judicial Review jurisdiction.”
42. The Respondent in its submission cites the case of Kenya Pipeline Company Limited case V Hyosung Ebara Company Limited & 2 Others [2012] eKLR where the Court pronounced itself as follows:
“The Review Board is a specialized statutory tribunal established to deal with all complaints of breach of duty by the procuring entity. By Reg. 89, it has power to engage an expert to assist in the proceedings in which it feels that it lacks the necessary experience. S. 98 of the Act confers very wide powers on the Review Board. It is clear from the nature of powers given to the Review Board including annulling, anything done by the procurement entity and substituting its decision for that of the procuring entity that the administrative review envisaged by the Act is indeed an appeal. From its nature the Review Board is obviously better equipped than the High Court to handle disputes relating to breach of duty by procurement entity. It follows that its decision in matters within its jurisdiction should not be lightly interfered with.
Having regard to the wide powers of the Review Board we are satisfied That the High Court erred in holding That the Review Board was not competent to decide whether or not the 1st Respondent’s tender had met the mandatory conditions. The issue whether or not the 1st Respondent’s tender was rightly rejected as unresponsive was directly before the Review Board and the Board had jurisdiction to deal with it.
In conclusion, it is manifest that the application for Judicial Review was not well founded. The 1st Respondent did not establish that the Review Board had acted without jurisdiction or in excess of jurisdiction or in breach of rules of natural justice or that the decision was irrational. The Judicial Review was not confined to the decision making process but rather with the correctness of the decision on matters of both law and fact. So long as the proceedings of the Review Board were regular and it had jurisdiction to adjudicate upon the matters raised in the Request for Review, it was as much entitled to decide those matters wrongly as it was to decide them rightly.
The High Court erred in essence in treating the judicial review application as an appeal and in granting judicial review orders on the grounds which were outside the scope of Judicial Review jurisdiction.”
43. The Respondent submit that it acted within the powers conferred to it by Section 173 of the Public Procurement and Asset Disposal Act in reaching its decision in the request for review and that its decision does not meet the threshold of unreasonableness, illegality and neither was it arrived at with procedural impropriety and that the applicant has not demonstrated the test.
44. The Respondent prays that the Notice of Motion dated 8th October, 2024 be dismissed with costs to the Respondent however section 175(7) of the PAD Act forbids award of costs to any party in the event the Board`s decision is quashed by the High Court.
1st and 2nd Interested Parties case;
45. In opposition to the Applicants’ Application, the 1st and 2nd Interested Parties (hereinafter referred to as IP’s) filed a Replying Affidavit dated 17th October, 2024 sworn by Moses Onyango Odhiambo and written submissions dated 24th October, 2024.
46. The 1st and 2nd IP’s aver that communication of intention to award was made on 12th day of August, 2024 and posted on 13th day of August, 2024 after which the standstill period lapsed on the 27th day of August, 2024 and award made unchallenged.
47. The 1st and 2nd IP’s deponed that the Applicant participated in a wrong bid in that, they submitted a bid for Tender No. SNSC/427D/2023/2024 for the period of 2024-2025 while the procuring entity 2nd Interested party advertised for Tender Reference No. SNSC/237D/2024/2025 for the period 2024-2026 and that further the Applicants request for review was filed outside the 14 days of statutory timelines stipulated under section 167 (1) of the Public Procurement and Asset Disposal Act Cap. 412 C read with Regulation 203 (2( C ) (iii) of Regulations 2020.
48. The 1st and 2nd IP contend that Contract dated 1st day of September 2024 was signed after the lapse of the stand still period provided under section 135 (3) of the Act is valid and accordingly, the Board is divested of jurisdiction to entertain the Request for Review by dint of section 167 (4) ( C ) of the Act therefore the provisions of sections 173 of the Act was inapplicable in the circumstance of the case before this Honourable court.
49. The 1st and 2nd IP’s further deponed that the Respondent did not violate Articles 10, 47, 159 (d) and 272 (1) of the Constitution of Kenya and the principles articulated under Section 3 of the Act and neither did it wrongly interpret sections 87 and 135 (3) of the Act including the provisions of section 2(3) of the Kenya Information and Communications Act as read with Regulation 3 of the Kenya Information and Communication (Postal and Courier) Regulations.
50. It is the 1st and 2nd IP’s submission that Section 167 (1) of the Public Procurement and Asset Disposal Act, 2015 envisages that an aggrieved party may seek administrative review within 14 days of notification of award or date of occurrence of an alleged breach at any stage of the procurement process. In this case, the Applicant ought to have moved this Respondent within 14 days after notification of award.
51. They cite the case of African Merchant Assurance Co. Ltd (Amaco) v Public Procurement Administrative Review Board; Madison General Insurance Kenya Ltd & 2 others (Interested Parties) [2020] eKLR where the court held that the 14 days’ standstill period for purposes of communication of the notification of awards in procurement processes starts to run from the time of sending the notification and not from the time of receipt of the notification.
52. They also submit that upon the lapse of the standstill period in this matter lapsed on 28th August, 2024 and thus 1st and 2nd Interested Party entered into a valid contract with the 3rd Interested Party on 1st September, 2024 and the Application for Review was Application was statute barred, the Respondent’s jurisdiction had been ousted.
53. The 1st and 2nd IPs further submit that the Applicant has failed to show this court how the Respondent acted illegally while making its decision and rely on the case of Republic v Muithali & another; Kaida (Interested Party) (Environment and Land Judicial Review Case 29 of 2022) [2024] KEELC 43 (KLR) (15 January 2024) (Ruling) the Honourable court cites the case of Kenya National Examination Council v Republic Ex Parte Geoffrey Gathenji Njoroge & 9 others [1997] eKLR where the Court of Appeal held:
“that an order of certiorari can only quash a decision already made and an order of certiorari will issue if the decision is without jurisdiction or in excess of jurisdiction or where the rules of natural justice are not adhered to or any other reasonable cause. It is trite law that the remedy of Judicial Review is not concerned with the merits of the case but the decision-making process. In order for an applicant to succeed in an application for Judicial Review, he must satisfy the court that a public officer has acted unprocedurally, that his decision was unreasonable and that the impugned decision was illegal.”
54. The 1st and 2nd IPs prays that the Application be dismissed with costs.
The 3rd Interested Party’s case;
55. In opposition to the Applicants’ Application, the 3rd Interested Party (hereinafter referred to as 3rd IP’s) filed grounds of opposition dated 7th November, 2024 stating the following grounds: -
a. The applicant filed its review application with the respondent out of the statutory time limits set out in Section 167 (1) of the Public Procurement and Asset Disposal Act (the Act) and the respondent decision in which it upheld the 3rd interested party’s preliminary objection is correct in law and unimpeachable.
b. The jurisdiction of the respondent was in any event ousted in view of Sections 167 (4) (c) and 135 of the Public Procurement and Asset Disposal Act, 2015 given that the 1st and 3rd interested parties had lawfully executed a valid and enforceable contract whose performance had commenced by the time the applicant lodged its review with the respondent.
c. The application is essentially an appeal against the decision of the respondent which is not the province of judicial review.
d. Other reasons to be set out in the replying affidavit sworn on behalf of the 3rd interested party sworn on 7th November 2024.
56. The third IP also filed Replying Affidavit dated 7th November, 2024 sworn by Linda Njenga and written submissions dated 8th October, 2024.
57. The third IP deponed that it participated in a competitive tender for provision of general insurance services (the tender) where the 2nd interested party was the procuring entity. The 3rd interested party emerged as the successful bidder. It received a notification of the award dated 12th August 2024 for the tender which it accepted
58. The 3rd IP further deponed that it learnt from the 2nd interested party that the latter sent the notification of award to it and also notified the unsuccessful bidder of the outcome of the tender process on 13th August 2024 by way of registered post and on 1st September 2024 which was 4 days after the lapse of the 14 days standstill period, the 2nd and 3rd interested parties executed a valid contract for provision of life assurance services (the contract).
59. The 3rd IP posits that Applicant filed a request for review against the tender on 3rd September 2024 which was 21 days after the date of notification and 2 days after the 2nd and 3rd interested parties executed the contract. This prompted the 3rd interested party to lodge with the Respondent the preliminary objection dated 17th September 2024 whereby the Respondent upheld its preliminary objection and 2nd and 3rd interested parties have been performing the contract since 1st September 2024.
60. The 3rd IP submits the Applicant filed its review application with the respondent out of the statutory time limits set out in Section 167 (1) of the Public Procurement and Asset Disposal Act (the Act) and the respondent decision in which it upheld the 3rd interested party’s preliminary objection is correct in law and unimpeachable.
61. The 3rd IP further submits that it not contested that the letter of notification was sent through registered post on 13th August 2024 and thus the respondent correctly ruled that time started running on 14th August 2024 (one day after the notification was received for postage). The last day for filing the review was on 28th August 2024.
62. The 3rd IP in its submission cites the case of PPARB No. 24 of 2023 - ADCC International East Africa Limited v Accounting Officer National Housing Corporation and Others where it held as follows-
“This Board takes the view that the benchmark date for computing the limitation period within which the instant Request for Review would be filed is the date when the Applicant became aware of the letter of notification. In the absence of proof that the Procuring Entity contacted the Applicant to collect the notification letter on 20th March, 2023 as alleged, it is reasonable to assume that the Applicant was notified on 31st March, 2023 when the letter was received and stamped at the post office.”
63. It is also its submission the jurisdiction of the respondent is ousted in view of Sections 167 (4) (c) and 135 of the Public Procurement and Asset Disposal Act, 2015 given that the 1st and 3rd interested parties have lawfully executed a valid and enforceable contract whose performance had commenced by the time the applicant lodged its review with the respondent and continues to be performed to date.
64. The 3rd IP also makes reliance on the Court of Appeal case of Municipal Council of Mombasa vs. Republic & Umoja Consultants Ltd [2002] eKLR where the court stated as follows on the scope of judicial review:
“…and as the Court has repeatedly said, judicial review is concerned with the decision-making process, not with the merits of the decision itself… The court would only be concerned with the process leading to the making of the decision. How was the decision arrived at? Did those who made the decision have the power, i.e. the jurisdiction to make it? Were the persons affected by the decision heard before it was made? In making the decision, did the decision-maker take into account relevant matters or did he take into account irrelevant matters? These are the kind of questions a court hearing a matter by way of judicial review is concerned with, and such court is not entitled to act as a court of appeal over the decider; acting as an appeal court over the decider would involve going into the merits of the decision itself-such as whether there was or there was not sufficient evidence to support the decision – and that, as we have said, is not the province of judicial review…”
65. The third IP further submits that the application is essentially an appeal against the correctness of the decision by the respondent which is not the province of judicial review and relies on the case of Republic vs Public Procurement Administrative Review Board Ex-parte Giant Forex Bureau De’ Change Limited and 2 Others [2017] eKLR the court held as follows-
…The applicant approached this court on grounds of bias, unreasonableness and irrationality. It has however not established that the Review Board was biased or that it acted unreasonably or irrationally. The applicant might have been wrong in its decision and appreciation of the doctrine of subrogation. That misapprehension, or error of law or fact, however, is not an issue within the judicial review purview of this court. This proposition was upheld by the Court of Appeal in the cited KENYA PIPELINE COMPANY LIMITED (supra) case in the following words-
…In conclusion, it is manifest that the application for Judicial Review was not well founded. The 1st Respondent did not establish that the Review Board had acted without jurisdiction or in excess of jurisdiction or in breach of rules of natural justice or that the decision was irrational. The Judicial Review was not confined to the decision-making process but rather with the correctness of the decision on matters of both law and fact. So long as the proceedings of the Review Board were regular and it had jurisdiction to adjudicate upon the matters raised in the Request for Review, it was as much entitled to decide those matters wrongly as it was to decide them rightly.
The High Court erred in essence in treating the judicial review application as an appeal and in granting judicial review orders on the grounds which were outside the scope of Judicial Review jurisdiction.”
66. The 3rd IP prays that application dated 8th October 2024 be dismissed with costs.
Analysis and Determination:
67. From the pleadings, the statutory statement, the responses, the rival submissions by the parties and the authorities’ referred to, this court identifies the following as the issues for determination;
Whether the applicant is entitled to the orders as sought;
68. Republic V Public Procurement Administrative Review Board & Another Ex Parte Gibb Africa Ltd & Another [2012] eKLR set out the established reach of judicial review in Kenya thus;
“The reach of judicial review is now well established. In the case of COUNCIL OF CIVIL SERVICE UNIONS V MINISTER FOR THE CIVIL SERVICE [1984] 3 ALL ER 935Lord Diplock summarized the scope of judicial review thus: -
“Judicial review has I think developed to a stage today when without reiterating any analysis of the steps by which the development has come about, one can conveniently classify under three heads the grounds upon which administrative action are subject to control by judicial review.
The first ground I would call "illegality," the second "irrationality" and the third "procedural impropriety.” …
By "illegality" as a ground for judicial review I mean that the decision-maker must understand correctly the law that regulates his decision-making power and must give effect to it. Whether he has or not is par excellence a justiciable question to be decided, in the event of dispute, by those persons, the judges, by whom the judicial power of the state is exercisable.
By "irrationality" I mean what can by now be succinctly referred to as "Wednesbury unreasonableness"
(Associated Provincial Picture Houses Ltd, v. Wednesbury Corporation [1948] 1 K.B. 223). It applies to a decision which is so outrageous in its defiance of logic or of accepted moral standards that no sensible person who had applied his mind to the question to be decided could have arrived at it. Whether a decision falls within this category is a question that judges by their training and experience should be well equipped to answer, or else there would be something badly wrong with our judicial system.
I have described the third head as "procedural impropriety" rather than failure to observe basic rules of natural justice or failure to act with procedural fairness towards the person who will be affected by the decision. This is because susceptibility to judicial review under this head covers also failure by an administrative tribunal to observe procedural rules that are expressly laid down in the legislative instrument by which its jurisdiction is conferred, even where such failure does not involve any denial of natural justice.”
69. Section 167 (1) of the Public Procurement and Asset Disposal Act, 2015 envisages that an aggrieved party may seek administrative review within 14 days of notification of award or date of occurrence of an alleged breach at any stage of the procurement process.
70. In the case In the case of African Merchant Assurance Co. Ltd (AMACO) v Public Procurement Administrative Review Board; Madison General Insurance Kenya Ltd & 2 others (Interested Parties) [2020] eKLR, where the court held: -
“50. The 2nd Interested Party has not shown that this analysis was in error or unreasonable to warrant this Court’s intervention, given that under section 167(1) of the Act, there are two instances when time will start to run for purposes of filing a request for review with the Respondent. These are the date of notification of the award, or the date of occurrence of the alleged breach at any stage of the procurement process or disposal process. For purposes of filing a request for review, the receipt of the notification is in the regard the trigger in terms of time starting to run.
…
57. Section 135 of the Act provides that it is the giving of notification which is the trigger of time for purposes of entering into contract with a successful bidder, while under section 87 of the Act is clear that it is the procuring entity that is required to give this notification. The Respondent relied on the date of receipt of the notification by the 1st and 3rd Interested Parties as the material act in determining the date when a contract is to be signed. The receipt of a notification by a bidder is however not a factor that is to be considered under section 135 of the Act with respect to when a contract is to be executed by a procuring entity, unlike in the case of filing for Requests for Review. The obvious mischief that was intended to be avoided by this distinction was the intentional delay that may be caused in entering into contracts by unsuccessful bidders.
58. The standstill time under section 135 of the Act therefore starts to run from the time of sending of the notification, and not the receipt of a notification. The Respondent, having applied an erroneous criterion, and having failed to interrogated and make a determination of the material factor as to when time started to run for the standstill time, thereby erroneously assumed jurisdiction to hear and determine the 1st and 3rd Interested Parties Request for Review. It therefore follows that the decision made by the Respondent was unlawful for this reason.”
71. In the case of African Merchant Assurance Co. Ltd (Amaco) v Public Procurement Administrative Review Board; Madison General Insurance Kenya Ltd & 2 others (Interested Parties) [2020] eKLR the court held that the 14 days’ standstill period for purposes of communication of the notification of awards in procurement processes starts to run from the time of sending the notification and not from the time of receipt of the notification.
72. Regulation 3 of the Kenya Information and Communication (Postal and Courier) Regulations provides as follows; “A postal article shall be considered—
a) to have been delivered to the addressee—
i. when it is delivered into a private letter box or bag of the addressee;
ii. when it is left at the house, or office of the addressee as set out thereon, or with the employee, agent or any other person authorized to receive it; or
iii. where the addressee is a guest or is a resident at a hotel, hostel or lodging, when it is left with the proprietor or manager of the hotel, hostel or lodging or with his agent; or
b) to have been received by a postal licensee when it is deposited into a posting box or handed over to an employee or agent of a postal service operator authorized to receive it.”
73. It is the Applicants’ case that the notification was not delivered into its letter box or bag. The parcel was delivered to the Applicant’s office through EMS courier services and therefore Regulation 3 (a) (ii) applies instead of Regulation 3 (a) (i) as held by the Respondent.
74. The Applicant’s case is that the notification of intention to award dated 12th August 2024 was delivered to the Applicant’s office on 27th August 2024.
75. Regulation 3 of the Kenya Information and Communication (Postal and Courier) Regulations provides as follows;
“A postal article shall be considered—
b) to have been received by a postal licensee when it is deposited into a posting box or handed over to an employee or agent of a postal service operator authorized to receive it.”
76. It is this court’s finding that the notification has a postal stamp which is the trigger date and not any other date as alleged by the Applicant.
77. This court is guided by the case of the African Merchant Assurance Co. Ltd (AMACO) v Public Procurement Administrative Review Board; Madison General Insurance Kenya Ltd & 2 others (Interested Parties) [2020] eKLR, where the Board held as follows at paragraph 116;
“The import of the above decision of Justice Nyamweya is that (a) the trigger for purposes of entering into a procurement contract with the successful bidder is the giving/issuance of notification by the procuring entity, (b) the date of receipt of a notification is NOT a factor to be considered under Section 135 of the Act with respect to when a contract is to be executed by a procuring entity unlike in the case of filing a request for review application, and (c) the standstill period under section 135 of the Act starts running from the time of sending of the notification and not on receipt of the notification.”
78. It is this court’s finding that the notification of the award was done on 13th August, 2024 when the award letter was posted to the bid winner and the regrets sent to their counterparts who had lost the bid as set out in Way bill from postal corporation of Kenya.
79. The 1st and 2nd Interested Party have clearly demonstrated that the way bill receipt that they received from Postal Corporation of Kenya was duly stamped on 13th August, 2024 and it was even noted on the face of it that it was received and accepted on 13th August, 2024.
80. The Respondent in its Decision dated 24th September 2024 observed that the Ex parte Applicant’s copy of the EMS Shipment Waybill revealed that though the date and time of acceptance as handwritten thereon appeared to read 26/8/24, the date of stamp affixed thereon indicted 13.08.24 as the postage date and not on 26th August 2024.
81. The Ex parte Applicant had between 14th August 2024 and 27th August 2024 to seek administrative review before the Respondent. It didn't. The Request for Review was filed outside the 14 days’ statutory period prescribed under Section 167(1) of the Act.
82. Consequently, it is this court’s finding that the Respondent did not act illegally or irregularly in arriving at the decision that it was divested of jurisdiction to hear and determine Request for Review and I so hold.
83. This court finds no fault in the Respondents’ decision that would justify the review of the Respondents impugned decision.
The effect of signing a contract;
84. In Public Procurement Administrative Board v Four M Insurance Brokers Limited & 3 others (Civil Appeal E1009 of 2023) [2024] KECA 79 (KLR) (9 February 2024) (Judgment)
“On the second limb of jurisdiction relating to the existence of a signed contract, we note that the learned Judge of the superior Court held as follows on this issue:-“…217.In Republic vs. Public Procurement Administrative Review Board ex-parte Madison General Insurance Kenya Limited; Vice Chancellor Kenyatta University & Another (Interested Parties) (2022) eKLR where Justice Ngaah held as follows:-“it could be that indeed the contract was invalid, but in my humble view, considering the provisions of Section 167(4)(c) once a contract has been signed, the appropriate forum before which the question of validity of a signed contract can be determined is this Honorable Court.It does not necessarily follow that an aggrieved party is left without a remedy merely because a contract is signed. Grievances arising out of a signed contract will certainly be addressed but not before the Public Procurement Administrative Review Board. They will be addressed before the court which only has the jurisdiction to determine such disputes related to the alleged grievances.”218.The Board lacked jurisdiction to hear and determine the application by the 2nd Respondent under Section 167(4) of the Act, to entertain the application given that there was already a signed contract – signed on 2nd October 2023, between the ex-parte Applicant and the 3rd and 4th Respondent.219.Given that the Contract was executed between the Applicant and the 4th Respondent, on 2nd October 2023, the Board lacked jurisdiction to adjudicate over any request for review filed after the execution of a contract pursuant to the provisions of Section 167(4)(c) of the Act and I so hold…”
49.As already observed, the appellant’s jurisdiction emanates from Section 167(1) of the Act. Section 167(4) provides matters that shall not be subject to the jurisdiction of the appellant and, Section 167(4) (c) of the Act specifically, ousts the appellant’s jurisdiction where a contract is signed in accordance with Section 135 of the Act. Section 135 in this regard sets out various requirements to be met in the creation and signing of procurement contracts, and an ordinary and purposive interpretation of section 167(4) is that the appellant is required to inquire into whether a procurement contract has been signed in accordance with section 135 of the Act when deciding on whether it has jurisdiction to hear and determine a request for review filed before it in cases where a contract has already been signed, and its jurisdiction is only ousted once this preliminary inquiry establishes that the provisions on creation of a procurement contract under Section 135 of the Act have been met, or where it makes an error as to the existence of this statutory precondition.
50.Indeed in the case of Ederman Property Limited v Lordship Africa Limited & 2 others [2019] eKLR, where a similar question arose as to whether the Appellant had properly declined jurisdiction in a case where a contract had been signed, this Court stated thus: -“…The learned Judge who heard the motion identified as an important question the determination of whether the 2nd respondent committed an error of law when it declined jurisdiction to entertain the application for review because a contract had already been entered into and the application was filed outside fourteen (14) days.……..The review body is not allowed to consider a review where a contract has been signed in accordance with Section 135 of the Act. The learned Judge considered the manner in which the 2nd respondent on receiving the request for review had entertained it where it found that it had no jurisdiction to entertain the request for review in the face of a contract that had been signed between the appellant and the 3rd respondent. The Judge reviewed a number of decisions on the issue of jurisdiction which the 2nd respondent had found it lacked. The Judge distinguished the provisions of Section 167(4) (c) of the Act and Section 135 of the Act. Section 135 states that a contract shall be confirmed through the signature of a contract document incorporating all agreements between the parties and such contract shall be signed by the accounting officer or an officer authorized in writing by the accounting officer of the procuring entity of the successful tenderer. Section 135(3) provides that………..Having reviewed the provisions of the said Sections 135 and 167 of the Act, the Judge found at paragraph 73 of the judgment that:“In this case, the review board makes no reference to whether or not the contract allegedly signed was in accordance with Section 135 of the Act. From the above cited case law, it is clear that the review board should have first determined whether the contract in question was signed in accordance with Section 135 of the Act. This is so because the mere fact that a contract has been signed does not necessarily deprive the respondent of the jurisdiction to entertain the request for review. In other words, before the review board makes a determination that it has no jurisdiction to entertain the request by virtue of sect 167 (4) (c) of the Act, it has the duty to investigate whether the contract in question was signed in accordance with Section 135 of the Act and the failure to do so in my view would amount to improper deprivation of jurisdiction; in my further view improper deprivation of jurisdiction is as bad as action without or in excess of jurisdiction”….We fully agree with the conclusion reached by the Judge in this respect. It was the duty of the 2nd respondent to satisfy itself that the 3rd respondent had followed the law on procurement and rules of natural justice in awarding the tender to the appellant and finding that the 1st respondent’s tender bid was unsuccessful…”
51.We adopt and agree with this reasoning. Put another way, section 164(7) implies a jurisdiction on the part of the appellant to entertain an application as to whether a contract is signed in accordance with Article 135, and is meant to address the obvious mischief of the signing of illegal procurement contracts so as to oust the jurisdiction of the appellant.”
85. In the instant suit, it is not in dispute that the 1st and 2nd Interested Party entered into a contract with the 3rd Interested Party on 1st September, 2024 in accordance with Section 135(3) of the Act.
86. From the impugned decision this court has satisfied itself that the Respondent addressed its mind to the issue of the contract. From the decision it is clear that the Respondent considered whether or not the contract allegedly signed was in accordance with Section 135 of the Act and determined that the contract in question was signed in accordance with Section 135 of the Act.
87. The earliest that a contract could be lawfully signed in the subject tender was on or about the 28th August 2024 after the lapse of the 14 days standstill period and as such, the contract dated 1st September 2024 was valid having been signed 3 days after the lapse of the standstill period provided under Section 135(3) of the Act as a result of which The Respondent was divested of jurisdiction to entertain the Request for Review by dint of Section 167 (4)(c) of the Act And I so hold.
Disposition:
88. The Ex Parte Applicant has not demonstrated any elements of illegality, irrationality, procedural impropriety and/or unfairness in the manner in which the Respondent arrived at its Decision in Request for Review.
Order;
The Application is dismissed with costs.