The Special Tribunal has ordered Easyway, Tarmac, Pave and Projects CC to pay the Special Investigating Unit (SIU) R68.8m.
The tribunal made this order on September 5. It also declared the R167.9m contract entered into between Limpopo’s Mogalakwena local municipality and Easyway in 2018 was invalid and set aside.
The SIU said on Wednesday the company fraudulently misrepresented its grades and projects it had undertaken, thereby inducing the municipality to award the tender to it.
“The order follows a successful application by the SIU to review and set aside the award of the tender for the supply, delivery, installation and/or construction of borehole development, storage reservoirs and bulk gravity supply pipelines, which was awarded to Easyway in February 2018,” SIU spokesperson Kaizer Kganyago said.
The R68.8m is the profit Easyway derived from the contract. The justification for the return of the ill-gotten spoils, said the SIU, was that fraud — in an unfair and non-transparent manner — excluded other competitors in the selection process.
The tribunal upheld the SIU’s evidence that Easyway deliberately lied in its bid documents. The company claimed to have completed three projects, each valued at more than R50m, for various municipalities.
The SIU investigation, supported by affidavits from municipal managers, proved these claims were false. In one instance, Easyway inflated the value of an actual project from R6.1m to more than R50.8m. In another, it claimed it had completed a project that never existed.
The SIU’s investigation found Easyway would not have scored the minimum points required to qualify for the tender had it not made false claims.
The tribunal held that Easyway’s contractor grading legally disqualified it from undertaking a contract of this value (R167.9m), which was about 29% above its permitted threshold.
“By supplying contract prices that were above the minimum required in the bid documents and engineering projects that never existed, Easyway has incontestably and deliberately misrepresented to the municipality that it was a qualified bidder when it knew the converse to be correct,” judge Brian Mashile said.
The evaluation process by the municipality’s bid evaluation committee was found to be unfair and non-transparent, as it failed to score bids according to its own specifications properly and could not justify why a higher-scoring bidder was overlooked.
“The award should not have been made in the first place, and no contract should have been concluded between the municipality and Easyway,” Mashile said.
The Tribunal ruled that Easyway must also pay for the SIU’s legal costs for this application.
The SIU was authorised by Proclamation R180 of 2021 to investigate and recover the loss the state has suffered due to the contract.
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