HEADLINE: SIU BLUNDERS UNMASKED
BLURB: The investigating unit has been slapped with a punitive costs order for a Covid case against Vigario Consulting
The Special Investigating Unit (SIU), whose flashy website proclaims it is “the state’s preferred and trusted anti-corruption, forensic investigation and litigation agency”, isn’t always successful. In fact, it lost a recent case quite spectacularly, with a punitive costs order underlining the gravity of its mistakes.
The case involved Vigario Consulting, a company that had secured a Covid-era contract to supply surgical masks to the Mpumalanga department of health (DoH). In an attempt to have the contract set aside as unlawful, the SIU had taken the matter to the special tribunal — a court that adjudicates civil matters brought by the SIU.
This dispute, one of many related to the supply of Covid-related equipment, put the spotlight on the way the DoH had obtained masks from Vigario — and on the quality of the SIU case.
In her ruling, tribunal president judge Lebogang Modiba explained that the SIU interviewed various DoH officials about how the masks were procured. But, disturbingly, she said the SIU had “ignored key aspects of their explanations and/or defences”.
“This is inconsistent with the duty upon the SIU to conduct its investigations in the interests of justice and not simply to catch out and haul before this tribunal organs of state, state officials, entities and/or other persons implicated in procurement maladministration.”
Modiba added that the unit also “failed to investigate key issues to properly establish some of the SIU’s grounds of review”.
A punitive costs order was ‘the most appropriate way of expressing the tribunal’s disapproval’
The SIU’s case was that the procurement was irregular and had to be set aside because it didn’t comply with the relevant regulations, the masks weren’t “centrally procured, warehoused and distributed” as required by a National Treasury note, and the price exceeded the prescribed maximum.
But, said Vigario, the DoH deputed its official, Tshegofatso Moralo, to liaise on the supply question. As he was held out as the person Vigario had to deal with, the company said it was entitled to assume that all internal DoH procedures had been followed. (Last month, the SIU successfully applied for Modiba to interdict the Government Employees Pension Fund from paying out benefits to Moralo pending the finalisation of six cases — the Vigario case was not one of them — relating to allegedly irregular Covid contracts in which he was involved.)
A case with ‘no merit’
In this case, the judge found the SIU allegations that the DoH, specifically Moralo, procured masks directly from Vigario without using correct procedures had “no merit”, and said it was disturbing that the SIU hadn’t dealt with explanations by DoH officials.
She also found it disturbing that the SIU didn’t consider the “overriding” exceptions, saying it should know about these “considering the plethora of Covid-19-related procurement contract reviews it has litigated” before the tribunal.
Vigario was registered on the central supplier database at the time the company approached the DoH about supplying masks, and no case was made that the agreed price exceeded the prescribed price. The SIU also failed to point out to the tribunal that Moralo had listed three other entities from which quotations were obtained, but that Vigario was the only one that could provide the quantities required.
Modiba found several SIU claims weren’t substantiated. For example, it had said Vigario wasn’t registered as a medical supplier with the South African Health Products Regulatory Authority (Sahpra), but no case was made out that the three-ply masks supplied to the DoH were “medical devices”, or that Vigario wasn’t registered with Sahpra. She said several allegations by the SIU hadn’t been investigated and that it had failed to disclose some of the documents on which its action was based.
Dismissing the case, Modiba agreed that a punitive costs order against the SIU was justified: it hadn’t investigated the disputed contract properly and, during its investigation, it also “failed to act in the interests of justice”. Its case was “wholly unfounded” and it “utterly fail[ed] to make out a case” for the order it requested the tribunal to make. Its presentation was shoddy and a punitive costs order was “the most appropriate way of expressing the tribunal’s disapproval” of the SIU’s conduct, she concluded.
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