Wakilii

Rhino Engineering Works Limited v Otuke District Local Government (Application 24 of 2024)

Tribunal · [2024] UGPPDPAAT 22 · 2024 Application Granted — Procurement Cancelled AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Direct application to the Tribunal for review of procurement evaluation and disqualification of bid
Decision
Procurement cancelled; Respondent may re-tender if it wishes

Observed later treatment

No later-treatment classification is recorded for this judgment.

Citator coverage is limited to judgments in the Wakilii corpus and source-matched treatment records. Absence of a signal is not an assertion that the case remains good law.

AI-generated summary. This summary was generated by AI from the full text of the judgment. It may contain errors or omissions—always read the source judgment before relying on it.

Holding

The Tribunal held that the Applicant had locus standi to bring a direct application based on demonstrated belief that the Accounting Officer could not handle the complaint impartially. The evaluation was conducted unlawfully: the Evaluation Committee was not properly nominated or appointed in accordance with statutory requirements, the Accounting Officer illegally usurped the independence of the Procurement and Disposal Unit, and the Contracts Committee of another district was used without proper written agreement. The disqualification of the Applicant's bid at the financial comparison stage was based on extraneous criteria not specified in the bidding document, constituting an illegal amendment of evaluation criteria. The procurement was cancelled.

Outcome

Procurement cancelled; Respondent may re-tender if it wishes

Facts

Otuke District Local Government initiated a tender for low-cost sealing of two roads under open domestic bidding. Three bidders submitted bids. On May 3, 2024, the Respondent issued a Notice of Best Evaluated Bidder indicating Unified Investment Company Ltd as the best evaluated bidder at UGX 302,405,425. The Applicant's bid was disqualified on the stated ground that the Applicant had presented fraudulent claims and misinformation to the district in a previous contract. The Applicant contended that this reason was unrelated to the financial evaluation criteria and amounted to an illegal amendment. The Applicant filed a direct application to the Tribunal on the ground that it believed the Accounting Officer had a conflict of interest arising from a previous contractual dispute over additional works and payment. The Respondent contended that post-qualification assessment revealed contractual dishonesty by the Applicant in a previous contract and that the matter was under investigation by the Inspector General of Government. At the hearing, the Senior Procurement Officer informed the Tribunal that there were two sets of Evaluation Committees, neither with appointment letters, and that she had protested the use of the second committee which conducted the evaluation.

Issues

  1. Whether the Applicant has locus standi before the Tribunal?
  2. Whether the evaluation of the bids in the impugned procurement was conducted lawfully?
  3. What remedies are available to the parties?

Orders

  • Application allowed.
  • Award of contract to Unified Investment Company Ltd set aside.
  • Procurement for low-cost sealing of Church Road and Civic Road under Procurement Reference Number OTUK915/WRK/23-24/00004 cancelled.
  • Respondent may re-tender the procurement if it so wishes.
  • Tribunal's suspension order dated May 13, 2024 vacated.
  • Each party to bear its own costs.

Rules and key headnotes

Public Procurement — Locus Standi — Direct Application to Tribunal — Conflict of Interest
A bidder may bring a direct application to the Public Procurement and Disposal of Public Assets Appeals Tribunal under sections 89(9) and 91(1)(c) of the Public Procurement and Disposal of Public Assets Act and regulation 9(5) of the Administrative Review Regulations 2023 where the bidder demonstrates grounds for believing that the Accounting Officer has a conflict of interest or that the matter cannot be handled impartially by the procuring entity. The bidder bears the burden of particularising the incidences constituting the belief of partiality. Conflict of interest is both actual and perceived incompatibility between private interest and public or fiduciary duties, assessed from the perspective of what a reasonable person would conclude while viewing the transaction from a distance.
Public Procurement — Evaluation Committee — Appointment and Nomination Requirements
Under sections 32(a) and 37(2) of the Public Procurement and Disposal of Public Assets Act, members of an Evaluation Committee must be recommended by the Procurement and Disposal Unit and approved by the Contracts Committee. An Accounting Officer who appoints an Evaluation Committee without recommendation from the Procurement and Disposal Unit illegally usurps the independence and powers of that Unit contrary to section 38 of the Act. An evaluation conducted by an improperly appointed Evaluation Committee is illegal, null and void.
Public Procurement — Use of Another Entity's Contracts Committee — Written Agreement Requirement
The use of the Contracts Committee of another procuring and disposing entity must be under a written agreement in accordance with section 39 of the Public Procurement and Disposal of Public Assets Act and regulations 16 and 18 of the Public Procurement and Disposal of Public Assets (Procuring and Disposing Entities) Regulations 2023. Use of another entity's Contracts Committee without compliance with these requirements is illegal.
Public Procurement — Post-Qualification — Scope and Timing
Post-qualification evaluation under regulation 11(1) of the Public Procurement and Disposal of Public Assets (Evaluation) Regulations 2023 can only be conducted on the best evaluated bidder. A bidder who is not the best evaluated bidder is not eligible for or subject to post-qualification. A claim that a bidder was disqualified at the post-qualification stage when that bidder was not the best evaluated bidder is untenable in law.
Public Procurement — Evaluation Criteria — Amendment and Application of Extraneous Criteria
The criteria used for evaluation must be in accordance with the criteria specified in the bidding document. Application of criteria extraneous to the evaluation criteria stated in the bidding document constitutes an illegal amendment of the evaluation criteria contrary to section 71(3) of the Public Procurement and Disposal of Public Assets Act and regulation 5(2) of the Public Procurement and Disposal of Public Assets (Evaluation) Regulations 2023. Disqualifying a bidder at the financial comparison stage for reasons unrelated to the financial comparison criteria specified in the bidding document is unlawful.
Public Procurement — Disqualification Based on Contractual Dispute — Non-Discrimination Principle
To disqualify a bidder merely on account of a contractual dispute from a previous contract, where there is no evidence that the demand itself is dishonest or fraudulent, violates the cardinal principles of non-discrimination, transparency, fairness, and maximisation of competition in public procurement.
Public Procurement — Due Diligence — Timing and Application
Under regulation 26 of the Public Procurement and Disposal of Public Assets (Procuring and Disposing Entities) Regulations 2023, a procuring entity may undertake due diligence on a bid at any time from commencement of evaluation to before signing of the contract. However, where a procuring entity relies on due diligence as a basis for disqualification, there must be proof that the due diligence test was carried out and indication of how the findings were factored into or considered before disqualification. Reliance on due diligence without such proof is untenable.

Legislation cited (22)

Cases cited (4)

  • Magombe Badiru v Sironko District Local Government (Application No. 22 of 2024)
  • Kacyber Security Technologies Ltd v Mbarara City Council (Application No. 18 of 2024)
  • Abasamia Hwolerane Association Ltd v Jinja City Council (Application No. 18 of 2021)
  • Elite Chemicals Limited v Uganda Coffee Development Authority (Application No. 8 of 2021)

Full judgment

↓ Download PDF

The original judgment as reported. Read the original PDF before relying on any passage.

Rhino Engineering Works Limited v Otuke District Local Government (Application 24 of 2024) 2024 UGPPDPAAT 22 (30 May 2024)
Source: this page presents Wakilii’s issue analysis and metadata for a publicly reported Ugandan judgment. Any AI-generated summary is marked as such. Judgment text is sourced from the Uganda Legal Information Institute (ulii.org). Wakilii is not affiliated with ULII.