Former Prasa Group CEO Lucky Montana “simply ignored procedures, bypassed committees and manipulated documents” to advantage Siyangena Technologies in the award of contracts worth about R5.5bn, said the Supreme Court of Appeal (SCA) in a judgment on Tuesday.
After recent allegations of attempts to persuade Prasa to settle, the judgment is a vindication of the high court’s 2018 order, which set aside the contracts as unlawful. The SCA also rejected Siyangena’s argument on appeal that it was “innocent” of what had happened inside Prasa.
“The high court inferred an ‘existence of corruption ... from the fact that a multitude of irregularities exist’ and the ‘absence of a candid explanation from the tenderer [Siyangena]’. That remains the only plausible inference on a conspectus of all uncontroverted evidence,” said acting justice Mahendra Chetty on behalf of a unanimous bench of five justices.
Prasa went to court in 2018 to set aside its own contracts with Siyangena, which were for the supply and maintenance of an integrated security access management system at a number of train stations. The approach to court was taken after a “board of control” took over in 2014 and Montana resigned “under a cloud” in 2015.
The board of control set out in its court papers — an affidavit from head of legal Martha Ngoye — extensive irregularities with the tender awards, said the SCA, and the Pretoria high court agreed — finding that in awarding the contracts, Prasa had breached the constitutional requirement to act “in accordance with a system which is fair, equitable, transparent, competitive and cost-effective”.
Prasa proceeded to contract with Siyangena on the pretext that it would not be able to secure an alternative contractor ... before the commencement of the 2010 Fifa World Cup.
— Justice Mahendra Chetty
Recounting how the initial contract was awarded, Chetty described how a pilot project to upgrade certain train stations ahead of the 2010 Fifa World Cup was extended, initially to seven sites at a cost of R90.9m in 2010.
The “haste” with which it was done was evident by the fact that Siyangena requested an appointment letter within two days from the date of its proposal. Concerns raised by the senior manager for projects and by supply chain management were “brushed aside”, said the judgment. The contract was concludedafter “private meetings” between Prasa officials and Siyangena, including Montana, said the judgment.
“Prasa proceeded to contract with Siyangena on the pretext that it would not be able to secure an alternative contractor ... before the commencement of the 2010 Fifa World Cup,” said Chetty, adding Prasa documents were manipulated to conceal a prior commitment to Siyangena to the exclusion of other contractors.
Siyangena then piggybacked on its original contract, for extensions — and in this way contracts were “allowed to bypass any vetting under the procurement system”. Montana “simply ignored procedures, bypassed committees and manipulated documents”, said the judgment.
“When the tender documents did find their way to the board for approval, the minutes concealed irregularities and contained misrepresentations,” said Chetty.
Siyangena was not an “innocent party”, said the judgment. Chetty said he was satisfied the high court was “ineluctably driven” to conclude Siyangena was “complicit, alternatively involved” in the corruption in relation to the contracts.
However, like the high court, the SCA acknowledged that Siyangena had done work of value for Prasa. The appeal court therefore also confirmed the high court’s order that an independent engineer should value the works Siyangena claimed to have carried out — if Prasa underpaid it would make up the shortfall, if it overpaid, Siyangena would be liable to recompense Prasa.
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