Sizwe sama Yende

Rogue officials who manipulate procedures and wrongfully award tenders will be personally held liable and pay back public money from their own pockets. 

The Bloemfontein Supreme Court of Appeal (SCA) has affirmed this when it ordered that officials of the Nelson Mandela Metro Bay pay back R7.7 million after they appointed a communications and marketing strategy consulting company without following tender procedures.

This order was first issued by the Eastern Cape Division of the High Court in Gqeberha in April 2022, but officials lodged an appeal.

The officials who have since left the municipality were municipal manager Mpilo Sakile Mbambisa, former acting city manager Mamisa Chabula-Nxiweni (deceased), former Integrated Public Transport System (IPTS) project manager Mhleli Mlungisi Tshamase, former chief finance officer, Trevor Harper, former chief operations officer, Mzwake Clay, former director of communications Roland Williams, and former executive director of infrastructure and engineering Walter Shaidi.

They got into trouble when they appointed Erastyle (Pty) Ltd as a consultant in the development of a comprehensive communication and marketing strategy, valued at some R6 million, for the IPTS. 

Erastyle was appointed without a public tender process and in breach of the municipality’s supply chain management policy.

After this appointment, the municipality made unlawful payments to Erastyle.  The payments were made in three batches of R5 263 179.89, R1 390 800 and R984 197.21.

The council instituted an action in the High Court against Erastyle and the officials and obtained an order declaring Erastyle’s appointment as unlawful and invalid in terms of s 172(1) of the Constitution.

The High Court directed Erastyle and the officials to repay money because the payments constituted irregular expenditure under the Municipal Finance Management Act. 

The officials, however, opted not to testify in court. Only three of the officials lodged an appeal against the High Court’s order. 

They argued that:

·      The municipality delayed unreasonably in approaching the court to declare the impugned appointment unconstitutional and invalid;

·      The High Court’s interpretation of section 32 of the MFMA was wrong as the municipalitywas not entitled to recover irregular expenditure unless it proved that it has sustained loss or damage, which it failed to do; and that the Municipality received value in that Erastyle had rendered services to it pursuant to the impugned appointment.