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[2017] ZAWCHC 53
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Normandien Farms (Pty) Limited v South African Agency for Promotion of Petroleum and Exploitation SOC Limited and Others (24294/2016) [2017] ZAWCHC 53 (3 May 2017)
IN
THE HIGH COURT OF SOUTH AFRICA
(WESTERN
CAPE DIVISION, CAPE TOWN)
CASE
NO: 24294 /2016
In
the matter between:
NORMANDIEN
FARMS (PTY) LIMITED
First
Applicant
v
THE
SOUTH AFRICAN AGENCY FOR PROMOTION
OF
PETROLEUM AND EXPLOITATION S.O.C
(STATE
OWNED COMPANY)
LIMITED
First
Respondent
RHINO
OIL AND GAS EXPLORATION SA (PTY) LTD
Second
Respondent
THE
MINISTER OF MINERAL
RESOURCES
Third
Respondent
Coram:
Dlodlo J
Date
of Hearing: 22 March 2017
Date
of Judgment: 03 May 2017
JUDGMENT
DLODLO,
J
[1] This
is an application seeking to set aside the acceptance by the first
respondent of the application
for an Exploration Right in terms of S
79 of the Mineral Resources Development Act 28 of 2002 (‘the
MPRDA’) read with
Regulation 28 (2) of the Regulations
published in terms of S 107 of the MPRDA lodged by the second
respondent. There are other
ancillary reliefs sought by the applicant
in this application. The application is opposed by the second
respondent. The first respondent
has given no notice to oppose the
application but it has filed an affidavit described as an explanatory
affidavit.
[2] The
applicant is owner of various farms situated in Northern
Kwazulu-Natal to which the Exploration Right
application lodged by
the second respondent in terms of S 79 of the MPRDA, relates. These
farms are,
inter alia
: (i) The Albany No. 8944, situated in
the Dannhauser registration division and in Dannhauser Magisterial
district; (ii) Subdivision
3 of the farm The Neck No. 10548 situated
in the administrative district of Natal Province and in the Newcastle
magisterial district;
(iii) The remainder of the farm Mardedash No.
2, No. 9401, situated in the Dannhauser magisterial district; (iv)
The farm Buffelshoek
No. 15469, situated in the Newcastle
registration division and in the Newcastle magisterial district; (v)
Portion of the farm Konigsberg
No. 16293, situated in the Newcastle
registration division and in Newcastle magisterial district; (vi) The
farm Woodburn No. 15470,
situated in the Newcastle registration
division and in the Newcastle magisterial district. The applicant
conducts timber farming
on the above properties and has (reportedly)
also established a bottling plant, bottling water for commercial sale
in this country.
[3] The
first respondent is a state owned company and it is also known as The
Petroleum Agency S.A. (‘PASA’).
PASA has been designated
by the Minister of Mineral Resources – the third respondent
herein, as the agency to perform the
functions in Chapter 6 of the
MPRDA on behalf of the Ministry. The second respondent is a company
with limited liability registered
and incorporated in accordance with
the company laws of the Republic of South Africa and has its
registered office and principal
place of business in Cape Town,
Western Cape. The third respondent (the Minister of Mineral
Resources) was appointed in terms of
S 3(2) of the MPRDA as the
custodian of the Nation’s mineral and petroleum resources –
I am told no relief is sought
against the Minister and that he was
merely joined by virtue of his interest in the application.
FACTUAL
BACKGROUND
[5] The
application for an Exploration Right was lodged by the second
respondent in terms of S 71 of the
MPRDA on 15 May 2016 and was
accepted by PASA in terms of S 79 of the MPRDA on 15 May 2016. S 10
(1) of the MPRDA provides in peremptory
terms that ‘
within
14 days after accepting an application lodged in terms of S 79, PASA
must make known and publish this fact in the prescribed
manner.’
The manner of publication is set out in Regulation 3, being the
Regulation published in terms of S 107 of the MPRDA. The notices
in
terms of S 10 (1) of the MPRDA are dated 20 April 2015 but were only
sent to certain magistrates courts on 5 May 2016.
[6] By
virtue of the fact that the application for an Exploration Right has
been accepted on 15 April 2016,
it would appear to be now impossible
to now comply with the peremptory terms of S 10. The notices of
acceptance of the application
were sent to the following magistrates’
courts by fax; (i) the Dannhauser Magistrates Office (Majuba); (ii)
the Zululand
Magistrates Office (Inkanyezi); (iii) the Emseleni
Magistrates Office (Uthungulu); (iv) the Hlabisa Magistrates Office
(Umkhanyakude);
(v) the Estcourt Magistrates Office (Uthukela); (vi)
the Colenso Magistrates Office (Umzinyathi). Some of the farms
belonging to
the applicant are situated within the Danuhauser
Magisterial division (as mentioned above) and some in the Newcastle
Magisterial
Division. According to the founding papers, in respect of
the Newcastle Magisterial division, no notice had been sent to it at
all. This, the second respondent does not contest. On the contrary it
is admitted.
[7] In
respect of the Dannhauser Magisterial division, a notice was
apparently sent but, notwithstanding
the fact that it records that a
list of the farms involved would accompany such notice, and that it
would be exhibited on the Notice
Board, there is no confirmation from
the Magistrates office to the effect that it was in fact displayed on
the notice board and
there is no reference to the farms.
[8] The
documentation supplied by PASA makes it apparent that it had elected
to resort to the publication
of the acceptance of the application on
the Notice Boards of the Magistrates Courts in the areas where the
immovable properties
are situated as required in terms of Regulation
3 (3) (b) of the MPRDA Regulations. There can be no denying that S 79
(1) (b) of
the MPRDA provides that the application must be submitted
in the prescribed manner.
[9] The
applicant requested PASA to provide all documentation pertaining to
the lodgement of the application
in compliance with Regulations
mentioned above. However, such documents were only supplied to the
applicant pursuant to an application
having been submitted by the
applicant in terms of the
Promotion of Access to Information Act 2 of
2000
. The applicant placed reliance on the documents so supplied to
it in support of its contention that there has not been compliance
with the Regulations.
[10] The
second respondent has, in terms of
Regulation 21
of the Regulations
published in terms of the National Environmental Management Act 107
of 1998 (‘NEMA”) obtained a
Scoping report which was
submitted and accepted by PASA on 31 August 2016. As things now
stand, the second respondent is in the
process of complying with the
provisions of Regulation 23 of NEMA Regulations by compiling and
submitting an Environmental Impact
Assessment Report and an
Environmental Management Programme. The latter was actually due for
submission on 5 January 2017 for approval
by PASA by 7 January 2017.
The latter state of affairs is confirmed in the letter by the second
respondent dated 9 December 2016
serving as Annexure ‘MLH18’
in the founding papers. The applicant contends that it has not
received any notice at all,
nor did it have any knowledge of the fact
that an application for an Environmental Right had been lodged with
PASA. The applicant
reportedly only became aware thereof on 7
December 2017.
[11] It
is of importance to mention that the Minister has published
Regulations in terms of S 107 (1) of
the MPRDA. These Regulations
prescribe the manner in which the acceptance must be made known and
the manner in which interested
persons must be called upon to
comment. It is mentioned in passing that S 79 (1) (b) of the MPRDA
provides that the application
must be lodged in the prescribed
manner. Such prescribed manner is in turn defined in Regulation 28
read with Regulation 2 of the
MPRDA Regulations. Needless to state
that these Regulations are couched in peremptory terms and the word
‘
must’
is used throughout.
[12] From
the documents in the possession of PASA which have been supplied to
the applicant as aforementioned,
the latter gathers that the Notices
which PASA purportedly has issued and transmitted to the Magistrates
Courts are defective in
the following respects:-
(a) No
notice was sent to the Newcastle Magistrates Office in respect of the
properties owned by the applicant
there; (b) The notice was sent to
the Dannhauser Magistrates Office in respect of the immovable
properties owned by the applicant
situated in that Magisterial
district. But this notice is defective in that there is no list
annexed thereto of the immovable properties
involved and no evidence
exists that the Notice was displayed on the Notice Board of the
Magistrates Office concerned; (c) Regarding
all other notices (save
for the Estcourt Magistrates Office, there is no evidence that
attached thereto was a list of the immovable
properties involved, and
no evidence exists that the notices were displayed on the Notice
Board of the relevant offices.
THE
LEGAL FRAMEWORK
[13] The
Minister was appointed in terms of S 3 (2) of the MPRDA as the
custodian of the Nation’s Mineral
and Petroleum Resources. He
may grant, issue, refuse, etc. an Exploration Right in terms of the
MPRDA. The Minister has designated
these obligations in terms of the
MPRDA to PASA in terms of S 70 of the MPRDA. PASA mainly performs the
functions referred to in
Chapter 6 of the MPRDA (ss 69 to 90).
[14] The
obligations set out in S 71 of the MPRDA entail the receipt of
applications for Exploration Rights
(s 71 (b)), to evaluate the
Exploration applications and to make recommendations to the Minister
(S 71 (c)) with regard to the
acceptance of environmental reports and
conditions of environmental authorisations (S 71 (i)). S 79 of the
MPRDA provides that
any person who wishes to apply to PASA for an
Exploration Right must lodge an application at the office of the
designated agency
situated in Cape Town in the prescribed manner,
with a prescribed non-refundable application fee.
[15] In
terms of S 79 (2) of the MPRDA, PASA is obliged, within 14 days of
the receipt of the application
for an Exploration Right, to accept
the application for an Exploration Right if there has been compliance
with the provisions of
S 79 (2) of the MPRDA read with the
Regulations. Section 79 (1) of the MPRDA provides that the
application for an Exploration must
be lodged in the prescribed
manner, which is prescribed by Regulation 28 of the Regulations
published in terms of the MPRDA read
with Regulation 2. Section 79
(4) of the MPRDA provides that in the event of PASA having accepted
the application, it is obliged
within 14 days from the date of
acceptance to notify the applicant (second respondent) in writing,
and consult with any affected
party and to submit an environmental
management program. The provisions of S 10 of the MPRDA are
implicated in this matter. I set
out such provisions
infra
:
‘
10.
Consultation with Interested and Affected parties.
1. Within
14 (Fourteen) days after acceptance of the application lodged in
terms of Section 16, 22 or 27,
the Regional Manager must in the
prescribed manner-
(a) make
known that an application for a prospecting right, mining right or
mining permit has been accepted
in respect of the land in question;
and (b) call upon interested and affected persons to submit their
comments regarding their
application within 30 (Thirty) days from the
date of the notice.
2. If
a person objects to the granting of a prospecting right, mining right
or mining permit, the regional
manager must refer the objections to
the regional mining development and environmental committee to
consider the objections and
to advise the Minister thereon.’
[16] Chapter
6 of the MPRDA, including S 69, contains the provisions pertaining to
Petroleum and Production.
Section 69 (2) (a) of the MPRDA provides
that for the purpose of Chapter 6, inter alia, SS 9 and 10, 37,
Chapter 7 and Schedule
ii apply with the necessary changes. In terms
thereof, S 69 (2) (a), S 10 of the MPRDA (relevant herein) applies to
the application
for an Exploration Right referred to in Chapter 6 of
the MPRDA. Consequently, S 10 is applicable when an application is
made for
an Exploration Right.
[17] I
set out
infra
the provision of Regulation 3 of the
Regulations:
‘
(3)
CONSULTATIONS WITH INTERESTED AND AFFECTED PERSONS
(1) The
Regional Manager or designated Agency as the case may be must make
known by way of Notice that an
Application contemplated in Regulation
2 has been accepted in respect of the land or offshore area as the
case may be.
(2) The
notice referred to in sub-regulation (1) must be placed on a notice
board at the office of the Regional
Manager or designated agency, as
the case may be that is accessible to the public.
(3) In
addition to the notice referred to in sub-regulation (1), the
Regional Manager or designated
agency, as the case may be, must also
make known the application by at least one of the following methods-
(a) publication
in the applicable Provincial Gazette;
(b) notice
in the Magistrate's Court in the magisterial district applicable to
the land in question; or
(c) advertisement
in a local or national newspaper circulating in the area where the
land or offshore area
to which the application relates, is situated.”
(4) A
publication, notice or advertisement referred in sub-regulation (3)
must include-
(a) An
invitation to members of the public to submit comments in writing on
or before a date specified in
the publication, notice or
advertisement, which date may not be earlier than 30 days from the
date of such publication, notice
or advertisement;
(b) A
name and an official title of the person to whom any comments must be
sent or delivered; and
(c) The
–
(i) work
postal and street address and, if available an electronic mail
address;
(ii) work
telephone numbers; and
(iii) facsimilee
number if any of the persons contemplated in paragraph (b) .’
[17] Section
F of the guidelines pertaining to the application to be submitted in
terms of S 10 (1) (a) of
the MPRDA reads as follows:
‘
F.
SECTION 10 (1) (A): NOTIFICATION BY THE REGIONAL MANAGER
To
comply with this provision, the Regional Manager or designated
agency, as the case may be,
(1). Must
as prescribed in Regulation 3, make known by way of a notice, that an
application contemplated
in Regulation 2 has been accepted in respect
of the land or offshore area, which notice must be placed on a notice
board at the
office of the Regional Manager or designated agency as
the case may be, and in addition also make the application known by
at least
one of the following methods-
a. Publication
in the applicable Provincial Gazette;
b. Notice
in the magistrates court in the managerial district applicable to the
land in question; or
c. Advertisement
in a local or national newspaper circulating in the area where the
land or offshore area
to which the application relates, is situated.
Since
the intention of the Act is to make the application known in order to
afford communities and interested and affected parties
an opportunity
to raise comments and concerns before the application can be
processed further, the prescribed notifications do
not preclude the
Regional Manager from placing notices at other venues such as the
relevant local Municipality, the Department
of Traditional Affairs,
or on the Departments official website, or from causing the
application to be brought to the attention
of other directly affected
parties I identified in the consultation process.’
Regulation
86 of the Regulations published in terms of the MPRDA provides inter
alia the following:
‘
86 ENVIRONMENTAL
IMPACT ASSESSMENT
(1) The
Exploration and production activities related to petroleum are
subject to the requirements of the
National Environmental Management
Act and
any relevant specific Environmental Management Act.’
In
terms of S 80 (1) (c) of the MPRDA, an Exploration right will only be
granted if the Minister has issued an Environmental Authorisation.
[19] Another
important provision relevant to this matter is Regulation 22 of NEMA
which provides the following:
‘
22.
A competent authority must within 43 days of receipt of a scoping
report-
(a) Accept
the scoping report with or without conditions and advise the
Applicant to proceed or continue
with the task contemplated in the
plan of study for environmental impact assessment; or
(b) Refuse
the environmental authorisation if-
(i) The
proposed activities are in conflict with a prohibition contained in
legislation; or
(ii) If
the scoping report does not substantially comply with appendix 2 to
these Regulations and the Applicant
is unwilling or unable to ensure
compliance with these requirements within the prescribed period.’
Section
10 (2) read with S 69 (2) (b) of the MPRDA provides that if a person
objects to the granting of an exploration right the
Regional Manager
must refer the objection to the Regional Mining Development Committee
to consider the objections and to advise
the Minister thereon.
DISCUSSION-APPLICATION
OF LEGAL PRINCIPLES
[20] Relying
on
Gamevest (Pty) Ltd v Regional Land Claims Commissioner,
Northern Province and Mpumalanga and Others
2003 (1) SA 373
(SCA), Mr De Waal prefixed his submissions by stating the following:
‘
The
two challenges fall to be rejected on the following basis:
5.1
the
actions complained about are either “administrative actions”
within the meaning of S 1 of PAJA in which event the
applicant is
obliged, by virtue of S 7 (2) of PAJA, to exhaust the internal appeal
conferred by S 96 of the MPRDA; or
5.2 the
actions complained about are merely preliminary steps taken en route
to administrative act, ie the
granting or refusal of the exploration
right, in which event they are not reviewable until the final
decision is taken.’
The
alternative argument presented on behalf of the second respondent is
that its application complied with the prescribed requirements
in all
respects save for one, namely that the MPRDA Regulation 28 (2) (f)
calls for the provision of ‘
a certified copy or copies of
the title deed or deeds, where applicable, in respect of the area to
which the application relates.’
In Mr De Waal’s
contention, this provision was intended to cater for pre-existing
‘
old order’
mineral rights, which would be
reflected in the title deeds of landowners. Expanding on his
contention Mr De Waal explained
that holders of such rights were
afforded a period of one year after implementation of the new
legislative regime (in terms of
the MPRDA and regulations) to ‘
use
it or lose it’
i.e. to exercise their exclusive rights to
apply for new order rights, failing which they would forfeit the
opportunity to do so.
[21] The
argument presented on behalf of the second respondent is that
(concerning the second challenge)
it is not necessary to determine
whether the first notification process was compliant because PASA
elected (in addition to that
process) to implement the notification
method provided for in MPRDA regulation 3 (3) (a) – publication
of the notice in the
Provincial Gazette. In Mr De Waal’s
submission, this completely cures any defect which may have existed
in respect of the
first process. As to the 14 day period which sets
time limit within which the acceptance must be made known, Mr De Waal
opines
that non-compliance therewith does not result in invalidity of
the acceptance. As far as the third challenge is concerned it is
contended on behalf of the second respondent that EIA Regulation 16
(2) (a) merely requires that the application for an exploration
right
must be accepted before the application for environmental
authorisation may be submitted.
[22] Maybe
the most convenient manner of dealing with this matter is first and
foremost to make a determination
whether the obligations of PASA
amount to administrative decisions or not. Indeed, it is apparent
from S 96 of the MPRDA, particularly
S 96 (3), that there are
internal remedies that must be exhausted. There is for instance an
appeal to the Minister in the event
of an administrative decision
having been taken by,
inter alia
, PASA. See
Bengwenyama
Minerals (Pty) Ltd and Others v Genovah Resources (Pty) Ltd and
Others
2011 (4) SA 113
(CC) at para. 55. In
Dengetenge v
Southern Sphere
2014 (5) SA 138
(CC) at para. 68, the
Constitutional Court observed:
‘
[68] Section
7 (2) (a) does not preclude any person from applying to court for the
review of an administrative
act unless the person has exhausted his
or her internal remedies. It precludes a court from reviewing any
administrative action
in terms of PAJA unless any internal remedy
provided for in any other law has first been exhausted.’
It
is, however, instructive to mention that the obligations of PASA in
terms of S 79 (1) of the MPRDA (namely that the application
must
comply with Regulation 3 of the MPRDA) are prescriptive in form and
they do not constitute administrative decisions. Similarly,
the
provisions of SS 10 (1) (a) and 10 (1) (b), read with Regulation 3,
also do not involve any administrative decision at all
and they
remain prescriptive. Importantly, the MPRDA read with the Regulations
promulgated thereunder, make provision for various
phases and these
can be categorised into seven phases altogether. I have no intention
to specifically refer and deal with individual
phases. They have been
referred to and pointed out above. The prescribed manner referred to
in S 79 (1) (b) of the MPRDA is a reference
to Regulation 28 of the
MPRDA read with Form M in Annexure 1 to the Regulations. All that is
required from PASA is to ascertain
whether the requirements have been
met. This involves a mere scrutiny of the documents submitted. It
does not involve any decision-making.
The submission of the Scoping
Report by the second respondent to PASA also does not involve any
decision-making. PASA exercises
a discretion whether to accept or
refuse the Scoping Report. Although the latter involves the making of
a decision, it is not the
kind of decision that would adversely
affect the rights of any interested party at that stage (as is
required in S 1 of PAJA).
It is and remains a mere phase in the
process required for environmental authorisation.
[23] Mr
Roberts referred to
Gamevest (Pty) Ltd
supra
, a
decision which related to the lodgement of an application for a
Restitution of Land Right. In the latter case the Supreme Court
of
Appeal stated the following at para 11 of the judgment:
‘
[11] It
is patently clear that the fundamental right created by s 33 (1) and
(2) of the Constitution is that
of lawful and procedurally fair
administrative action. I emphasise the words ‘administrative
action’, because they
emphasise the very first question to be
asked and answered in any review proceeding: what is the
administrative act
which is
sought to be reviewed and set aside? Absent such an act, the
application for review is stillborn.’
Indeed
there is no neat definition in our law of what an administrative act
is for the purpose of justiciability. In
Hira and Another v
Booysen and Another
1992 (4) SA 69
(SCA) at 93A-B, the Supreme
Court of Appeal talking about what is required for common-law review
stated that the non-performance
or wrong performance of a statutory
duty or power by the person or body entrusted with the duty or power
will entitle persons injured
or aggrieved thereby to approach the
court for relief. The court went on to explain that where the
duty/power is essentially a
decision-making one and the person or
body concerned has taken a decision, a review is available. One bears
in mind that the Supreme
Court of Appeal in
Nedbank v Mendelow NNO
2013 (6) SA 130
(SCA) at 138 made the following observation
pertaining to the distinction between an administrative act or a mere
clerical or administrative
act:
“
[24]
As
I said in Kuzwayo v Representative of the executor in the estate of
the late Masinela, not every act of an official amounts to
administrative action that is reviewable under PAJA or otherwise. I
found there that the act of signing a declaration by a
director-general
of the department of housing to the effect that a
site permit be converted into the right of ownership, and the signing
of the
deed of transfer giving effect to that declaration, were
simply clerical acts.
[25]
Administrative
action entails a decision, or a failure to make a decision by a
functionary and which has a direct legal effect on
an individual.
A decision must entail some form of choice or evaluation. Thus while
both the Master and the Registrar of
Deeds may perform administrative
acts in the course of their statutory duties, where they have no
decision-making function, but
perform acts that are purely clerical
and which they are required to do in terms of the statute that so
empowers them, they are
not performing administrative acts within the
definition of PAJA or even under the common law.”
See
also in this regard
President of the Republic of South Africa v
South African
Football Union
2000 (1) SA 1
(CC) at para.
141. In
Manok Family Trust
v Blue Horison Investments
2014 (5) SA 50
(SCA) at 508, the Supreme Court of Appeal observed as
follows:
Counsel
correctly accepted in his heads of argument, and before us, that the
regional commissioner’s decision-to the effect
that the
criteria set out in ss (1) of s 11 had not been met, i.e. that there
had been no dispossession of the claimed land, which
decision was
conveyed to Kgoshi Manok in the letter of June 2000 –
constituted administrative action (see Gamevest (Pty)
Ltd v Regional
Land Claims Commissioner, Northern Province and Mpumalanga, and
Others
2003 (1) SA 373
(SCA)
(2002 (12) BCLR 1260)
para 7), capable
of being reviewed. In Oudekraal Estates (Pty) Ltd v City of Cape Town
and Others
2004 (6) SA 222
(SCA) ([2004]
3 ALL SA 1
;
[2004] ZASCA
48)
, a case which concerned the question whether, or in what
circumstances, an unlawful administrative act might simply be
ignored,
this court said the following:
‘
Until
the Administrator’s approval (and thus also the consequences of
the approval) is set aside by a court in proceedings
for judicial
review it exists in fact and it has legal consequences that cannot
simply be overlooked. The proper functioning of
a modern State would
be considerably compromised if all administrative acts could
be given effect to or ignored depending
upon the view the subject
takes of the validity of the act in question. No doubt it is for this
reason that our law has always
recognised that even an unlawful
administrative act is capable of producing legally valid
consequences for so long as the
unlawful act is not set aside’.
[24] It
is plainly apparent that the obligations on PASA in respect of the
receipt of the application,
the acceptance of the application, are
couched in peremptory terms in that the word ‘must’ is
used at all times. See
S 79 (2) of the MPRDA. Similarly Regulation 28
(2) quoted
supra
is also couched in peremptory terms and the
word ‘
must’
feature prominently. S 10 is couched
in peremptory terms providing what PASA is obliged to do after
accepting the application.
The same applies to Regulation 3. Mr
Roberts submitted that the actions of PASA (by virtue of the fact
that it has not complied
with peremptory requirements) has the effect
that the actions taken by it are unlawful and should be set aside on
the basis of
an illegality. He contended that it follows, that the
processes (in particular the process of the Scoping Report in terms
of NEMA),
also constitute an illegality and should be set aside. It
would follow that if PASA has not passed muster in having failed to
comply
with the peremptory obligations set out hereinabove, all
further processes constitute illegalities. This court was referred to
Weenen Transitional Local Council v Van Dyk
2002 (4) SA 653
(SCA) where the following reasoned observation is made:
‘
[13] It
seems to me that the correct approach to the objection that the
appellant had failed to comply with
the requirements of s 166 of the
ordinance is to follow a common-sense approach by asking the question
whether the steps taken
by the local authority were effective to
bring about the exigibility of the claim measured against the
intention of the legislature
as ascertained from the language, scope
and purpose of the enactment as a whole and the statutory requirement
in particular (see
Nkisimane and Others v Santam Insurance Co Ltd
1978 (2) SA 430
(A) at 434A-B). Legalistic debates as to whether the
enactment is peremptory (imperative, absolute, mandatory, a
categorical imperative)
or merely directory; whether ‘shall’
should be read as ‘may’; whether strict as opposed to
substantial
compliance is required; whether delegated legislation
dealing with formal requirements are of legislative or administrative
nature,
etc may be interesting, but seldom essential to the outcome
of a real case before the courts. They tell us what the outcome
of the court’s interpretation of the particular enactment is;
they cannot tell us how to interpret. These debates have a
posteriori, not a priori significance. The approach described above,
identified as ‘…a trend in interpretation away
from the
strict legalistic to the substantive’ by Van Dijkhorst J in
Ex Parte Mothuloe (Law Society, Transvaal, Intervening)
1996 (4) SA
1131
(T) at 1138D-E, seems to be the correct one and does away with
debates of secondary importance only.
[14] It
seems to be clear that the object of s 105 (1A) was to inform all the
ratepayers in the particular
borough of the council’s estimates
of its income and expenditure for the next financial year, and of the
amount of the assessed
rates. The estimates are to be made available
for inspection at the municipal office for a period of at least seven
days after
the publication of the notice. There can be no doubt, as
the Court a quo rightly, concluded, that where, upon inspection of
the
estimates, ratepayers should discover that the matters required
by s 105 (2) – (6) to be taken into account in arriving at
the
estimates have not properly been accounted for or that provision was
made in the estimates for expenditure which is not authorised
by the
ordinance, they would be entitled to approach a court for relief by
way of interdict or mandamus. I am also of the view
that in
appropriate cases the council’s decision as regards estimates
and assessments can be taken on review. The object
of the notice
required by s 105 (1A) is clearly not to place the ratepayer in mora
or to demand payment, but to afford an opportunity
to object to the
estimates and assessment.’
Similarly
in
Democratic Alliance v Ethekwini Municipality
2012 (2) SA
151
(SCA) the Supreme Court of Appeal talking to this aspect of our
law said the following:
‘
[21] This
conclusion does not mean, however, that these decisions are immune
from judicial review. The fundamental
principle, deriving from the
rule of law itself, is that the exercise of all public power, be it
legislative, executive or administrative-is
only legitimate when
lawful (see e g Fedsure para 56). This tenet of constitutional law
which admits of no exception, has become
known as the principle of
legality (see e g Cora Hoexter Administrative Law in South Africa
117). Moreover, the principle of legality
not only requires that the
decision must satisfy all legal requirements, it also means that
the decision should not be arbitrary
or irrational (see e g
Pharmaceutical Manufacturers Association of SA and Another: In re Ex
parte President of the Republic of
South Africa and Others
[2000] ZACC 1
;
2000 (2)
SA 674
(CC)
(2000 (3) BCLR 241)
in para 85; Affordable Medicines
Trust and Others v Minister of Health and Others
[2005] ZACC 3
;
2006 (3) SA 247
(CC)
(2005 (6) BCLR 529)
at paras 74-75).
[22] Departing
from these well-established principles, the appellant contended that
the impugned decisions
were illegal in that they fell foul of
statutory requirements and that they also failed to meet the
rationality test. As to the
former, it is not the appellant’s
case that the decisions were not taken in accordance with procedural
requirements that
are prerequisites to their validity, ie that they
suffered from what has become known as a ‘manner and form’
deficiency
(see e g King and Others v Attorneys’ Fidelity Fund
Board of Control and Another
2006 (1) SA 474
(SCA)
(2006 (4) BCLR
462
;
[2006] 1 ALL SA 458)
paras 17-18). The objection is that the
decisions were not preceded by a process of public participation
required by statute.’
[25] As
far as the interdictory relief sought is concerned I am of the view
that a clear
right
for an interdict has been established by virtue of the undisputed
failure to comply with the peremptory provisions of S
10 of the
MPRDA. S 5 of the MPRDA provides for serious inroads upon the
rights of a surface owner, if an exploration right
is granted. In the
Bengwenyama Mineral
case
supra
at page 139, the
following pertaining to harm was said:
‘
These
different notice and consultation requirements are indicative of a
serious concern for the rights and interest of landowners
and lawful
occupiers in the process of granting prospecting rights. It is
not difficult to see why:
The
granting and execution of a prospecting right represents a grave and
considerable invasion of the use and enjoyment of the land
on which
the prospecting right is to happen. This is so
irrespective of whether one regards a landowner’s right
as
ownership of its surface and what is beneath it in all the fullness
that the common law allows; or as use only of its
surface, if
what lies below does not belong to the landowner, but somehow resides
in the custody of the State. The
purpose of the
notification and subsequent consultation must thus be related to the
impact that the granting of a prospecting right
will have on the
landowner or lawful occupier.’
Although
reference is made to a prospecting right, we all know the object of
the MPRDA. As set out, the object of this legislation
and the notice
referred to, is equally applicable to the application for an
exploration right. It of course apparent that the Scoping
Report has
been accepted by PASA in terms of Regulation 22 of NEMA without
notice to the applicant. This much is fully explained
in the founding
affidavit. It has not been disputed. On the contrary there is an
admission in this regard.
[26] It
is common cause that the second respondent has been directed by PASA
to submit an Environmental Impact
Report and Environmental Management
Programme within 106 days in terms of Regulation 23 of NEMA. Upon
receipt of the Environmental
Impact Report and Environmental
Management Programme, PASA would consider whether to accept the
report and make recommendations
to the Minister. See Regulation 24 of
NEMA and S71 (c) of the MPRDA. In terms of S 80 of the MPRDA the
Minister has the right to
grant an exploration right. The applicant
correctly fears that seeing that the Scoping Report had been
accepted, that alone has
somewhat exacerbated the situation in that
the second respondent is obliged to submit the Reports sooner. Indeed
the processes
set out in NEMA are time-related. The longer it takes,
the more difficult it obviously would be to stop the process and
various
affected landowners may claim prejudice. It is important to
point out that in the event of the Environmental Impact Report and
the Environmental Management Programme having been submitted to PASA,
the applicant would be precluded from either objecting thereto
or to
provide its input pertaining to environmental issues. I agree that
the applicant has been prejudiced in that it never had
the
opportunity to object to the acceptance of the application and for
that matter to be referred to the Regional Development and
Environmental Committee (in terms of S 10 (2) of the MPRDA). It was
for instance precluded from employing its own experts to provide
an
input which could have been submitted to PASA and ultimately to the
Minister. The founding papers reveal that the applicant
incurred a
capital investment of in the region of R40 million to set up a water
bottling plant on the farm Albany. It is feared
that if the
exploration right is granted, it could well affect such operation and
the water extracted from the earth. See,
inter alia
,
Allpay
Consolidated Investment Holdings (Pty) Limited & Others v Chief
Executive Officer South African Social Security Agency
2014 (10)
SA 604
(CC) at page 614 – 616;
Grey’s Marine Houtbay
(Pty) Limited & Others v Minister of Public Works
[2005] ZASCA 43
;
2005 (6) SA
313
(SCA).
[27] As
far as the interdictory portion of the applicant’s case is
concerned, this court bears in mind
that in determining whether an
application for an interim interdict has crossed the threshold of
proving a clear right or a right
(
prima facie
established
though open to some doubt) the proper approach is and remains to take
the facts set out by the applicant together with
any facts set out by
the respondent which the applicant cannot dispute and to consider
whether, having regard to the inherent probabilities,
the applicant
should (not could) on those facts obtain final relief at the trial.
The requirement of a right prima facie established
involves two
stages. Once such right has been assessed, the part of requirement
referring to the doubt involves a further enquiry
in terms whereof
the court looks at the facts set up by the respondent in
contradiction of the applicant’s case in order
to see whether
serious doubt is thrown on the applicant’s case. If there is a
mere contradiction or unconvincing explanation,
then the right will
be protected; where there is serious doubt, the applicant cannot
succeed. See
Spur Steak Ranches Ltd v Saddles Steak Ranch,
Claremont
1996 (3) SA 706
(C). It is trite that the different
requirements should not be considered separately or in isolation but
they must be considered
in conjunction with one another in order to
determine whether this court should exercise its discretion in favour
of the grant
of the interim relief sought. I need to mention that
there is no comprehensive rule that can be laid down for the exercise
of judicial
discretion in granting or refusing an interdict. The
court must decide on the circumstances of each individual case. It is
not
necessary to itemise the requisites for the interim relief. These
have become common knowledge in legal circles. I merely point
that
these considerations are of course not individually decisive, but
that they remain interrelated. For an example, the stronger
the
applicant’s prospects of success, the less his need to rely on
prejudice to himself. Conversely, the more the element
of ‘
some
doubt’
, the greater the need for the other factors to
favour him. As pointed out above, the court considers the affidavits
as a whole,
and the interrelation of the aforegoing considerations,
according to the facts and probabilities. See
Olympic Passenger
Service (Pty) Ltd v Ramlagan
1957 (2) SA 382
(D) at 383 D-G.
[28] The
relief sought in paragraphs 1, 2, 3 and 4 of the Notice of Motion
only involves PASA although it
might affect the second respondent.
PASA (which does not oppose this application) has, however, filed an
affidavit deposed to by
its acting Chief Executive Officer. This
affidavit is styled as ‘
Explanatory Affidavit’
. It
must be pointed out that pursuant to the institution of the current
application (wherein failure to comply with certain peremptory
requirements is relied on) PASA caused a Notice to be published in
the KwaZulu-Natal Provincial Gazette on 21 December 2016. This
is
seen by the applicant as an attempt to comply with the provisions of
Regulation 3 (3) (a) of the Regulations published
in terms of
the MPRDA. This publication which is clearly an after-thought on the
part of PASA itself constitutes an illegality
regard being had on the
provisions of S 10 (1) of the MPRDA. The latter section states in
peremptory terms that the publication
must take place within 14 days
after the acceptance of the application for an Exploration Right. Now
we know that the application
for an Exploration Right was accepted on
15 April 2016. How can publication envisaged in S 10 (1) of the MPRDA
take place more
than 8 months after the acceptance of the
application? A mention must be made that the provision of SS 10 (1)
(a) and 10 (1) (b)
of the MPRDA read with Regulation 3 of the
Regulations promulgated thereunder has as its object, an information
process whereby
all landowners are notified of the acceptance of the
Exploration application. The fact that prescribed method has not been
adhered
to is failure to comply with peremptory provisions of the
law. PASA has therefore committed an illegal act. The applicant has
had
to deal with PASA’s Explanatory affidavit. Effectively PASA
despite the fact that it filed no notice to oppose the relief
sought
herein, it has opposed the application by filing the Explanatory
affidavit.
[29] In
African Christian Democratic Party v Electoral Commission
supra
(CC) at 317 para 25, the Constitutional Court guidingly observed as
follows:
‘
[25] The
question thus formulated is whether what the applicant did
constituted compliance with the statutory
provisions viewed in the
light of their purpose. A narrowly textual and legalistic approach is
to be avoided as Olivier JA urged
in Weenen Transitional Local
Council v Van Dyk:
It
seems to me that the correct approach to the objection that the
appellant had failed to comply with the requirements of s 166
of the
ordinance is to follow a common-sense approach by asking the question
whether the steps taken by the local authority were
effective to
bring about the exigibility of the claim measured against the
intention of the Legislature as ascertained from the
language, scope
and purpose of the enactment as a whole and the statutory requirement
in particular (see Nkisimane and Others v
Santam Insurance Co Ltd
1978 (2) SA 430
(A) at 434A-B). Legalistic debates as to whether the
enactment is peremptory (imperative, absolute, mandatory, a
categorical imperative)
or merely directory; whether “shall”
should be read as “may”; whether strict as opposed to
substantial
compliance is required; whether delegated legislation
dealing with formal requirements are of legislative or administrative
nature, etc may be interesting, but seldom essential to the outcome
of a real case before the courts. They
tell
us what the outcome of the court’s interpretation of the
particular enactment is; they cannot tell us how to interpret.
These
debates have a posteriori not a priori
significance. The approach described above, identified as
“…a
trend in interpretation away from the strict legalistic to the
substantive” by Van Dijkhorst J in Ex parte
Mothuloe (Law
Society, Transvaal, Intervening)
1996 (4) SA 1131
(T) at 1138D-E,
seems to be the correct one and does away with debates of secondary
importance only.’
Similarly,
the Supreme Court of Appeal in
City
of Tshwane Metropolitan Municipality v RPM Bricks
2008 (3) SA 1
(SCA) at para 24 made the following important
observation:
‘
[24] With
respect to Boruchowitz J, what he postulates is, in my view, the
antithesis of that demanded by
the Constitution. Section 173 of the
Constitution enjoins courts to develop the common law by taking into
account the interests
of justice. The approach advocated by the
learned judge, if endorsed, would have the effect of exempting courts
from showing due
deference to broad legislative authority, permitting
illegality to trump legality and rendering the ultra vires doctrine
nugatory.
None of that would be in the interests of justice. Nor, can
it be said, would any of that be sanctioned by the Constitution,
which
is based on the rule of law, and at the heart of which lies the
principle of legality.’
What
the authorities referred to above warn the courts about is that they
must under no circumstances permit illegality to trump
legality. I
cannot therefore turn a blind eye to all these illegalities pointed
out in this case.
[30] One
must always treat matters falling under the MPRDA with sensitivity
deserved. It is not secret that
the MPRDA can be described as having
corroded the right of ownership of land. Before its promulgation the
holder of a title deed
in in respect of a piece of land also owned
what is underneath that particular land. But after the coming into
being of the MPRDA
the owner of the land only owns the surface of
that land. If there are minerals underneath that piece of land, those
minerals are
owned by the Government on behalf of the South African
Nation. In fact, the Guideline for consultation with communities and
interested
Parties issued in terms of SS10 (1) (b), 16 (4) (b), 22
(4) (b), 27 (5) (b) and 39 of the MPRDA must never be lost sight of
in
applications such as one lodged by the second respondent. The
preamble of the Standard Directive states categorically that since
the introduction of the MPRDA the State acknowledges the importance
of the involvement of communities where mining is taking place
at the
earliest stages of the application for prospecting and mining rights
and permits. This entails the communities being informed
and
consulted on any mining activities applied for by mining companies
(such as the second respondent) in their area. This preamble
points
out that the consultation process (and the result thereof) is an
integral part of the fairness process because the decision
cannot be
fair if the administrator did not have full regard to what happened
during the consultation process in order to determine
whether that
consultation was sufficient to render the grant of the application
procedurally fair. The rationale for consultation
is described in sE
of the Guidelines as follows:
‘
The
purpose of consultation with the landowner, affected parties and
communities is to provide them with the necessary information
about
the proposed prospecting or mining project so that they can make
informed decisions, and to see whether some accommodation
with them
is possible insofar as the interference with their rights to use the
affected properties is concerned. Consultation under
the Act’s
provisions requires engaging in good faith to attempt to reach such
accommodation.’
The
parties also argued the question of costs. I listened attentively to
these submissions. Having evaluated them, one must always
bear in
mind that the court exercises a discretion in the award of costs.
Such discretion must always be exercised judiciously
and reasonable.
ORDER
In
the circumstances I make the following order:
(a) The
acceptance by PASA (the First Respondent) of the application for an
Exploration Right in terms of
S79 of the Mineral and Petroleum
Resources Development ACT 28 OF 2002 (The MPRDA) read
with Regulation 28 (2) of the
Regulations published in terms of S 107
of the MPRDA lodged by the second respondent is
hereby set aside.
(b) The
notices purported to have been given by the First Respondent in terms
of S 10 (1) (a) and 10 (1)
(b) of the MPRDA read with Regulation 3 of
the Regulations published in terms of S 107 of the MPRDA are hereby
set aside.
(c) The
publication in the Kwazulu-Natal Provincial Gazette Number 1773 dated
21 December 2016 in terms of
S 10 (1) of the MPRDA read with
Regulation 3 (3) (a) of the Regulations promulgated thereunder, is
hereby set aside.
(d) The
acceptance by the First Respondent of the Scoping Report submitted by
the second respondent in terms
of Regulation 22 of the Regulations
published in ters of the National Environmental Management Act 107 of
1998 (NEMA), is hereby
set aside.
(e) The
Second Respondent is hereby interdicted and restrained from
submitting the Environmental Impact Assessment
Report (EIR) and the
Environmental Management Program (EMPr) compiled in terms of
Regulation 23 of the NEMA Regulations to the
first respondent for
consideration.
(f) The
costs of this application shall be paid by the first and second
respondents jointly and severally,
the one paying the other to be
absolved.
D
V DLODLO
Judge
of the High Court
APPEARANCES:
For
the Applicant:
Adv. MG Roberts (SC)
Adv. E Roberts
For
the Second Respondent:
Adv. HJ De Waal
Adv. NC De Jager
COURT:
DLODLO,
J
HEARD:
22 March 2017
DELIVERED:
03 May 2017
COUNSEL
FOR APPLICANT:
Adv. MG Roberts (SC)
Adv. E Roberts
ATTORNEY
FOR APPLICANT:
Vinnicombe & Associates
Thornville,
Kwazulu-Natal
c/o
MacGregor Stanford Kruger Inc. Attorneys
Cape
Town
Mr
O Kruger
COUNSEL
FOR SECOND RESPONDENT:
Adv. HJ De Waal
Adv. NC De Jager
ATTORNEY
FOR SECOND RESPONDENT
:
Dentons South Africa
KapdiTwala Chambers,
Ground Floor
Great Westerford, 240
Main Road
Rondebosch
ZC Twala