Dear Corruption Watch
My neighbours and I have been deprived of sanitation and a water service because of what we believe was a corrupted tender process.
Can we sue the council or the tender adjudication committee for the damages?
Could the other bidders who lost also institute a claim for damages?
Dear Seeking Recourse,
Let's start with the second part of the question: can the other bidders who were not awarded the tender sue the government? That answer will help us determine whether citizens can sue.
An unsuccessful bidder could sue under the law of delict, which regulates all the cases where one person wrongfully causes harm or loss to another. Under the law of delict, a claim will only be successful if the bidders can show that the government acted corruptly or fraudulently – there was a bribe, or members of the council had shares in the winning company. The bidder must prove that it would have been awarded the tender if there had been no corruption. If the government was merely negligent or incompetent – it did not understand the bids properly, or acted in a procedurally unfair manner – the bidder cannot sue in delict. Note that it can be difficult to prove corruption in court.
Second, the bidder could sue under the Promotion of Administrative Justice Act. It allows people affected by administrative acts to have those acts set aside. If you disagree with, for example, the award of a tender, you can use the act to have that decision invalidated.
The advantage of the act over the law of delict is that the award of the tender will (probably) be invalidated. The committee will then have to re-advertise the bid.
Residents can apply to have the tender invalidated under the act and force the government to appoint a new (hopefully competent) company the next time round.
A direct suit for damages will be more tricky. As far as we know, no one has ever tried to litigate such a case. We suspect that a court would be unlikely to award significant damages because of the financial burden it would impose on the government. The best way to fight corruption is through prosecution rather than suing for damages.
Take a stand and report corruption. This article originally appeared in The Sunday Times Business Times on 1 April 2012.