Manong and Associates (Pty) Ltd v City of Cape Town and Another (457/09) [2010] ZASCA 169; 2011 (2) SA 90 (SCA) ; 2011 (5) BCLR 548 (SCA) ; [2011] 2 All SA 383 (SCA) (1 December 2010)

Key Facts

Issues

• The court reviewed the cross-appeal regarding the misjoinder of Futuregrowth in the Setsing project. It affirmed the lower court's finding that Futuregrowth had no connection to the project and that joining other entities would have been unnecessary, as the complaint of racism against them was baseless.
• The court evaluated whether the appellant's allegations of racial discrimination by the City of Cape Town and Futuregrowth in the allocation of municipal contracts (including the Khayelitsha CBD and Setsing projects) were valid under the Promotion of Equality and Prevention of Unfair Discrimination Act 4 of 2000. The evidence demonstrated the complaints were unfounded, with the court finding no racial bias in the respondents' actions.
• The court assessed whether the Equality Court's decision to make no costs order against the unsuccessful complainant was justified. It concluded the litigation was contrived, with the complainant's unfounded allegations and improper conduct warranting a reversal of the costs order, requiring the appellant to pay the respondents' costs, including those of two counsel.

Holdings

• The cross-appeal by the first respondent in the broader Khayelitsha enquiry is upheld with costs. The court below erred in inverting the burden of proof, incorrectly concluding the CCT engaged in racial discrimination when the evidence did not support this.
• The appellant is ordered to pay the respondents' wasted costs from the 20 August 2010 appeal postponement, caused by the sudden illness of its senior counsel.
• The appellant's appeals regarding its exclusion from the CBD project and the misjoinder in the Setsing project are dismissed with costs, including two counsel's fees. The court found the complaints unfounded and the litigation conduct justified the costs order against the complainant.
• The court below's findings (para 36) and costs order (para 64) are set aside. The applicant's general discrimination complaint against the CCT in Khayelitsha is dismissed with costs, and it is ordered to pay respondents' costs related to the CBD project and Setsing project.
• Cross-appeals by the first and second respondents on the costs order are upheld with costs. The Equality Court's failure to account for the complainant's contrived case and improper litigation conduct justified reversing the original costs order.

Remedies

• The cross-appeals by the first and second respondents, in relation to the costs order in both cases, are upheld with costs, including the costs of two counsel.
• The appellant is ordered to pay the respondents' wasted costs occasioned by the postponement of the appeal on 20 August 2010.
• The finding of the court below set out in para 36 and the costs order contained in para 64 of the judgment dated 12 November 2008 are set aside and substituted. The applicant's complaint of discrimination is dismissed with costs, including the costs of two counsel and reserved costs from 18 August 2007.
• The cross-appeal by the first respondent in respect of the broader Khayelitsha enquiry is upheld with costs, including the costs of two counsel.
• The appellant's appeals in respect of its exclusion from the CBD project and the upholding of the second respondent's plea of misjoinder in the Setsing project are dismissed with costs, including the costs of two counsel.

Legal Principles

• The judgment applied a purposive interpretation of PEPUDA, focusing on its goal to prevent unfair discrimination and promote equality. The court criticized the Equality Court below for not aligning its analysis with the Act's objectives, particularly in evaluating the respondent's affirmative action policies.
• The court clarified that in discrimination cases under the Promotion of Equality and Prevention of Unfair Discrimination Act (PEPUDA), the complainant bears the burden to prove discrimination on a balance of probabilities. The Equality Court below incorrectly shifted this burden to the respondent (City of Cape Town), which was identified as an erroneous approach.
• The case emphasized that the standard of proof for discrimination claims under PEPUDA is the balance of probabilities. The court found that the complainant failed to meet this standard, as its allegations lacked sufficient evidence and were not substantiated.
• The court held that in constitutional litigation, costs orders should not deter legitimate complaints, but frivolous or vexatious claims may incur costs. The Equality Court's failure to consider the complainant's contrived allegations and improper litigation conduct justified reversing the original costs order and awarding costs to the respondents.

Precedent Name

• Biowatch Trust v Registrar, Genetic Resources
• Affordable Medicines Trust & others v Minister of Health & others
• Weare v Ndebele NO
• Naylor & another v Jansen
• National Coalition for Gay and Lesbian Equality & others v Minister of Home Affairs & others
• Cape Law Society v Feldman

Cited Statute

• Preferential Procurement Policy Framework Act 5 of 2000
• Broad Based Black Economic Empowerment Act 53 of 2003
• Promotion of Equality and Prevention of Unfair Discrimination Act 4 of 2000

Judge Name

• Ebrahim
• Cloete
• Navsa
• Mhlantla
• Van Heerden

Passage Text

• The company must at the very least show that it was treated differently to other engineering consultants in relation to COT or CCT projects. The company had to show that in the totality of City projects, it received disproportionately fewer contracts so in relation to other consultants. Since the very premise of the company's case was race it had to establish a prima facie case that the differentiation was race-based.
• From the minutes of site meetings and the evidence referred to in paras 30 and 31 it is palpably clear that the concerns expressed by Barnard, about the quality of the work done by the company in respect of the first phase, were genuine and justified. They certainly were not contrived. The conclusion of the court below that these concerns were never communicated to the company is therefore incorrect.
• In our view, it would indeed be appropriate to set aside the costs order made by the court below and to hold the company liable for the respondents' costs, including the costs of two counsel. The same result should ensue in respect of the costs in this court.