The High Court has ordered the Ministry of Interior to re-advertise a Sh12.5 billion police car leasing tender that had been awarded by Harambee House in controversial circumstances.
The ministry had sought to lease 1,290 vehicles.
Officials had initially issued the advert in May 2019, and in September the same year, just before they were to announce the winners, they cancelled it, citing high prices quoted by bidders.
The decision, they said, was informed by a market survey conducted by the ministry that showed taxpayers would have lost Sh1.04 billion if the tender had been awarded.
Advertising of vehicle-leasing tenders was taken over by the ministry from the Treasury, which had been doing it since 2014.
The previous tender was awarded in 2015 and expired on October 15, 2019. The contract has been extended for an indefinite period.
CMC Motors moved to the Public Procurement Administrative Review Board (PPARB), claiming that the ministry had flouted the law in cancelling the tender midstream.
PPARB dismissed the application on September 18, 2019 and ruled that the ministry had acted legally.
Aggrieved by PPARB’s decision, CMC moved to the High Court to challenge the decision on September 20, 2019. But as the High Court process was underway, the ministry re-advertised the tender, applied restricted tendering and selected a winner on October 1.
In his ruling, Justice John Mativo said PPARB’s decision was sound but he faulted the decision to re-advertise the tender before 14 days had lapsed after the PPARB decision as per the law.
“The Ministry of Interior admits awarding the contract, but explains that this was done before the stay orders were served upon it. This explanation was not contested, hence I find no difficulty accepting it. The major challenge is the admission that the retendering was done before the expiry of 14 days,” noted the judge.
“Differently put, the Ministry of Interior cannot enter into a valid contract before expiry of 14 days after the decision of the review board nor can it re-advertise the same procurement before the expiry of the 14 days, as it happened in this case. It follows that the purported re-advertisement and the alleged notification of the successful party or purported awarding of the tender by the ministry is illegal,” he added.
He dismissed the ministry’s defence that by the time it was served with the court injunction, the tender had already been opened, evaluated and a successful bidders notified.
“No documents were exhibited to support the averment nor was the alleged successful bidders disclosed or enjoined in the proceedings,” he stated.
The judge, who issued the judgment on Friday, said the new tendering process must adhere to the provisions of the Constitution, Public Procurement and Asset Disposal Act, Fair Administrative Action Act and Public Finance Management Act.
On September 30, Justice Mativo had stopped the ministry from concluding the process of leasing motor vehicles from local assemblers after a petition by CMC.
The injunction was served on October 2, 2019.
In the application, CMC argued that Interior Principal Secretary Karanja Kibicho re-advertised the tender through restricted tendering before the expiry of the 14 days set in law.
CMC had also argued that the reasons for dismissing its case were unreasonable as the PPARB failed to look into some matters it was bound to consider.
CMC told Justice Mativo that the ministry breached the company’s rights and legitimate expectations.
The tender has Lots 1 to 8, divided into various vehicle models.
CMC argued that the board failed to call to its attention that Lot 7 for heavy-duty, utility passenger vehicles and 4×4s was not in Phase II of the leasing programme but was introduced in the new phase.
It added that because of this, there was going to be a difference in the total leasing price.
The company said there was no proper actuarial price matrix that took into account all parameters of the lease programme, something the board was bound by the law to consider.
The parameters included motor vehicle specifications, insurance, driver training, service centres, vehicle replacements and out-of-contract prices.