Global engineering, management and specialist technical services group Aurecon welcomes the judgment of the Supreme Court of Appeal (SCA) of South Africa in the matter between the company and the City of Cape Town which, according to MD Albert Geldenhuys, vindicates the company from any fraudulent or corrupt tendering allegations.

The matter concerned the High Court application by the City of Cape Town to set aside its own decision to award Aurecon the tender for the decommissioning of the Athlone power station following allegations of corruption and apparent irregularities in the awarding of the tender, which appeared in the media in August 2012.

Subsequent to the publication of these allegations, the City of Cape Town commissioned auditors EY to investigate the process followed in the awarding of the tender to Aurecon and to determine whether this process had complied with relevant legislation and the city’s own procurement policies.

Aurecon stated that, although this investigation did not find any evidence of fraudulent, dishonest or corrupt behaviour on either the part of Aurecon or the City of Cape Town and its officials, the city nevertheless decided to launch an application in the Western Cape Division (WCD) of the High Court to review and set aside the awarding of the tender to Aurecon, as well as any contract that might have come into existence as a result of the tender award.

The WCD decided the matter in favour of the City of Cape Town in a judgment handed down in April 2014.

“The effect of this judgment was that a consulting engineering company that had prepared, for example, a scope of work for the provision of professional services pertaining to a particular project, was then excluded from tendering for a subsequent contract for the professional services provided for in such scope of work,” said the company.

Aurecon filed an application for leave to appeal the judgment that was granted in the WCD because of the significance of the issues raised in the application pertaining to the consulting engineering industry as a whole.

Aurecon’s appeal was heard by the full bench of the SCA on August 21 and judgment was delivered on December 9.

According to Geldenhuys, the decision to appeal the ruling of the WCD was not one that was taken lightly.

He noted that, although the company was reluctant to pursue a litigious course of action against a long-standing and highly valued client, it was evident that if the company did not act, the judgment would have a significant negative effect on the practice of consulting engineers in South Africa and on the accepted norms and practices that underpin the consulting engineering industry.

In the judgment handed down by the SCA, Aurecon’s appeal was upheld with costs and the order of the WCD was set aside.

“The SCA found support in the Treasury Guidelines for the contention that barring engineers with intimate knowledge of a particular project because of their prior involvement therewith from tendering would lead to unnecessary and wasteful expenditure and would not be in the best interest of taxpayers or organs of the state.

“It noted further that such engineers should be encouraged to participate in any competitive tender process in order to put such knowledge to good use,” Aurecon said in a statement.