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[2016] ZASCA 52
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Minister of Safety and Security and Another v Tembop Recovery CC and Others (006/2015) [2016] ZASCA 52 (1 April 2016)
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THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Reportable
Case
No: 006/2015
In
the matter between:
THE
MINISTER OF SAFETY AND SECURITY
FIRST
APPELLANT
THE
DIRECTOR OF PUBLIC PROSECUTIONS
GAUTENG
LOCAL DIVISION
SECOND
APPELLANT
and
TEMBOP
RECOVERY
CC FIRST
RESPONDENT
STAR
DIAMOND CUTTING WORKS CC
SECOND
RESPONDENT
GIANDOMENICO
(MARIO) MUGNAIONI
THIRD
RESPONDENT
MARCELLINO
MUGNAIONI
FOURTH
RESPONDENT
GIANDOMENICO
FLORIDO SALVATORE
MUGNAIONI
JNR
FIFTH RESPONDENT
MARIA
ROSARIA MUGNAIONI
SIXTH
RESPONDENT
GOFFREDO
MUGNAIONI
SEVENTH
RESPONDENT
Neutral
citation:
Minister
of Safety and Security v Tembop Recovery
(006/15)
[2016] ZASCA 52
(1 April 2016)
Coram:
Leach,
Saldulker, Dambuza, Mathopo JJA and Baartman AJA
Heard:
18
March 2016
Delivered:
1
April 2016
Summary:
Civil
Procedure ─ Uniform rules of court ─ application to
strike out the defence in application for return of items
seized in
terms of warrant of search and seizure ─ where such application
is made, and criminal proceedings are pending or
have been
reinstituted, court must consider the interests of justice
,
policy
and public considerations in the exercise of its discretion to grant
order ─ court should be loath to issue civil declaratory
orders
in matters which are the subject of criminal proceedings.
ORDER
On
appeal from:
The
South Gauteng Local Division of the High Court, Johannesburg (Vorster
AJ sitting as court of first instance):
1
The application for leave to appeal is granted.
2
The appeal is upheld.
3
Paragraphs 1, 2 and 3 of the order of the high court of 29 August
2014, dismissing the appellants’ application for condonation
and, striking out the appellants’ defence to the main
application are set aside and substituted with the following:
‘
1.1
The respondents are ordered to comply with the applicants’
notice in terms of rule 35(12) read with rule (13) of the Uniform
rules within ten (10) days of this order.
1.2
In the event of the respondents failing to comply with paragraph 1.1
of the order, the applicants may apply on the same papers
duly
amplified to strike out the respondents’ defence to the main
application.
2
Late filing of the respondents’ rule 6(5)(d)(iii) notice is
condoned.
3
The respondents are to pay the costs of this application as well as
the costs of their application for condonation.’
JUDGMENT
Mathopo
JA (Leach, Saldulker, Dambuza JJA and Baartman AJA concurring):
[1]
This is an application for leave to appeal against a judgment of the
South
Gauteng Local Division of the High Court, Johannesburg,
(Vorster AJ) in
which the appellants’ application for leave to appeal and
condonation was dismissed. The high court held that
in the absence of
compliance with a notice issued by the respondents’ in terms of
rule 35(12) read together with rule 35(13)
of the Uniform rules, the
respondents were entitled to an order for the striking out of the
appellants defence to the main application.
The high court also
ordered that the appellants pay the respondents’ costs on a
scale as between attorney and own client.
The high court refused
leave to appeal. On petition, this court granted leave to appeal
against that finding and ordered that the
parties be prepared if
called upon to do so, to argue the merits in terms of s 17(2)
(b)
and
(d)
of the Superior Courts Act 10 of 2013 (the Act).
Background
[2]
A brief background to the matter is as follows. During 2009, the
South African Police Services (SAPS) commissioned a special
investigation project named Project Nemesis, established after a
formal investigation was authorised in December 2007 relating
to an
alleged platinum syndicate. During these investigations, SAPS opened
some 50 dockets in various jurisdictions in the country
relating to
the syndicate.
[3]
As part of the investigations, the third and fourth respondents were
implicated in, and it was alleged that they were involved
in an
organised fashion over a period of time, possessed and dealt with
metals or precious groups of metals, in particular platinum,
which
was either stolen or illegally obtained. During 2011, the police
secured warrants for the search and seizure of these alleged
illegal
precious group metals and other items associated with the crime
committed and obtained warrants to arrest implicated persons,
who
included the third and fourth respondents. The evidence gathered
during the investigations indicated that they were linked
to
organised smuggling and illegal export of unwrought precious metals
from the Republic of South Africa to refineries abroad.
[4]
The third and fourth respondents, as well as other accused persons
were arrested and charged in terms of the Prevention and
Combating of
Corrupt Activities Act 12 of 2004 (POCA) in the Krugersdorp Regional
Court on 29 September 2011. The crimes for which
they were charged
were allegedly committed in districts within the North West, North
Gauteng and South Gauteng Provinces. The case
was postponed several
times for a variety of reasons, chief amongst which was the fact that
the State was not ready to proceed
because it was in the process of
centralising the matter, and intended to indict the third and fourth
respondents, and other accused
persons for contravention of the
certain provisions of the POCA. On 23 August 2013, the defence
successfully objected to a further
postponement and the State
provisionally withdrew the charges against them.
Issues
[5]
The preliminary issues in this appeal are the high court’s
refusal of the appellants’ (a) application for leave
to appeal
and (b) application for
condonation
for the late filing of their rule 6(5)
(d)
(iii)
notice. The main issue of substance is whether the high court
correctly exercised its discretion when it struck out the appellants’
defence to the main application whilst criminal proceedings were
pending. These issues are considered below.
The
application for leave to appeal
[6]
The high court correctly found that on a plain reading of rules
35(12) and 35(13), the respondents are entitled to documents
which
were relied upon in the appellants answering affidavit. Because the
appellants had not filed any opposing affidavit to the
notice in
terms of rules 35(12) and (13), it dismissed the application for
leave to appeal on the basis that there were no reasonable
prospect
of success on appeal. The attention of the high court was drawn to a
number of judgments of this court which held that
courts should be
loath to issue civil declarators in matters which are the subject of
criminal proceedings. The appellants thus
have an arguable case and
therefore have some prospects of success on appeal. There are
compelling reasons why the appeal should
be heard. It is also in the
interest of justice that leave to appeal be granted. I turn to
consider the application for condonation.
Condonation
[7]
It is trite that an application for condonation will be granted on
good cause shown. There are several factors that a court
would
generally take into account when considering whether or not to
exercise discretion, such as the reasons for lateness, the
importance
of the case, the prejudice to be suffered by the opposing party, and
whether there are any prospects of success.
[8]
The appellants sought condonation for the late filing of the notice
in terms of rule 6(5)
(d)(
iii)
which they filed on 18 July 2014. The explanation for the delay was
described by the appellants in the high court as ‘the
respondents rule 6(5)
(d)
(iii)
was unfortunately only filed on 15 July 2014 as a result of counsel’s
unavailability before that time.’ Because
no condonation
application had been filed by 24 July 2014, being the date allocated
for the hearing of the interlocutory application,
the matter was
postponed to 27 August 2014. The appellants submit that the
respondents suffered no prejudice as a result of the
delay and
contend that the interlocutory application was overtaken by events
once the criminal charges were reinstated, which they
were on 11 July
2014. (Those proceedings are still pending, apparently awaiting the
finalisation of this appeal.)
[9]
Although the explanation of the appellants’ is far from
satisfactory. There were indeed reasonable prospects of success
in
the case. The high court should have exercised its discretion and
granted condonation instead of dismissing the application.
However,
the opposition to the condonation application was not unreasonable
and the appellants who sought the indulgence should
bear the cost of
obtaining it. I turn to deal with the merits of the interlocutory
application.
Interlocutory
application
[10]
Spurred on, no doubt by the provisional withdrawal of the charges and
the failure of the State to recharge them as it had threatened
to do,
the respondents launched motion proceedings (the main application) on
12 February 2014, for the return of all seized items
under the search
and seizure warrant. At that stage the State had not yet served any
indictment on them in terms of POCA and the
authorisation for
centralisation of the cases because the crimes were allegedly
committed in various jurisdictions, namely North
West, Northern
Gauteng and South Gauteng, had not been obtained. In addition the
forensic reports were still outstanding. The centralisation
authorisation was necessary because it was the State’s
intention that all the pending cases be consolidated and be tried
in
one court, in this regard the
South
Gauteng Local Division of the High Court, Johannesburg
.
[11]
The appellants opposed the main application and filed an opposing
affidavit in which reference was made to several documents
supported
by annexures (in which the seized items were listed). They contended
that the relief sought by the respondents was incompetent
in law
because the respondents were not entitled to possess some of the
seized items, either as they were to be used as evidence
in pending
criminal proceedings or as their possession in the hands of the
respondents would be unlawful. In the opposing affidavit
reference
was made to the fact that the Mugnaioni family (who are related to
the respondents) operated a recovery works plant with
an expired
refinery licence and further that they were not allowed or entitled
to possess Precious Group Metals (PGM) and uncut
diamonds at their
premises.
[12]
After the appellants had filed their opposing affidavit, the
respondents did not file a replying affidavit. Instead they filed
a
notice in terms of 35(12) read with rule 35(13) on 14 April 2014,
requesting the appellant to produce and make available some
of the
documentation referred to in the State’s opposing affidavit of
warrant officer Meyer, an investigating officer in
the criminal
proceedings. The appellants did not oppose the rule 35(12) and (13)
notice. Instead, their attorney wrote to the respondents
attorneys on
13 May 2014 and indicated to the respondents that they were not
entitled to the documents requested. The appellants
placed reliance
for this proposition on the judgment in
Stevens
& others v Magistrate Swart & others
2014 (2) SA 150
(GSJ) where it was held that the provisions of rule
35(12) read with rule 35(13) were not applicable to motion
proceedings until
the stage where the court has issued an order
directing it to do so.
[13]
Rule 35(12) and (13) and rule 30A provide as follows:
‘
(12)
Any party to any proceeding may at any time before the hearing
thereof deliver a notice as near as may be in accordance with
Form 15
in the First Schedule to any other party in whose pleadings or
affidavits reference is made to any document or tape recording
to
produce such document or tape recording for his inspection and to
permit him to make a copy or transcription thereof. Any party
failing
to comply with such notice shall not, save with the leave of the
court, use such document or tape recording in such proceeding
provided that any other party may use such document or tape
recording.
(13)
The provisions of this rule relating to discovery shall
mutatis
mutandis
apply, in so far as the court may direct, to
applications.’
Rule
30A provides:
‘
(1)
Where a party fails to comply with these rules or with a request made
or notice given pursuant thereto, any other party may
notify the
defaulting party that he or she intends, after the lapse of 10 days,
to apply for an order that such rule, notice or
request be complied
with or that the claim or defence be struck out.
(2)
Failing compliance within 10 days, application may on notice be made
to the court and the court may make such order thereon
as it seems
meet.’
Clearly
the appellants were misguided, because there is no obligation on a
party seeking to exercise the provisions of rule 35(12)
to first
secure a directive from the court to do so. The mere reference of a
document in the affidavit entitles the other party
to seek or request
that the documents be produced. See
Machingawuta
& others v Mogale Alloys (Pty) Ltd & others
2012 (4) SA 113 (GSJ).
[1]
In so far as Stevens held to the contrary, it was wrongly decided.
[14]
As a result of the appellants’ failure to oppose the
interlocutory application, the respondents filed a notice in terms
of
rule 30A of the Uniform rules to strike out the appellants defence to
the main application (the interlocutory application).
The appellant
did not oppose this application. Relying on the
Stevens
judgment, and being of the view that the step taken by the respondent
was premature and irregular, they took no steps to set aside
the rule
30A notice as an irregular proceeding in terms of rule 30. The
respondents, as they were entitled to do, enrolled the
matter for
hearing on the unopposed roll for 24 July 2014. In the meantime, the
second appellant decided to officially institute
the criminal
prosecution against the third, fourth and other accused persons. On
11 July 2014, the criminal case was transferred
to the high court and
postponed, pending the outcome of these motion proceedings.
[15]
On 18 July 2014, without seeking condonation, the appellants served
and filed a notice in terms of rule 6(5)
(d)
(iii)
of the Uniform rules in which they raised three points of law,
namely, privilege, reinstitution of the criminal proceedings,
and
repeated their assertion that the respondents were not entitled to
the documents. They also made various factual assertions
and
explained why they had ignored both the rule 35(12) notice and that
under rule 30A. The belated stance of the appellants resulted
in the
matter being postponed to 26 August 2014. On 28 July 2014, the
appellants delivered an application for condonation for the
late
filing of the rule 6 notice. As stated earlier, the high court
thereafter dismissed the condonation application and struck
out the
appellants defence to the main application in terms of rule 30(A).
[16]
The gravamen of the respondents’ submission in relation to the
interlocutory application was that the appellants should
have
delivered an answering affidavit and not a notice in terms of rule
6(5)
(d)
(iii).
The appellants concede that they were misguided about the correct
legal procedure applicable to rule 35(12) applications
but contend
that the high court exercised its discretion wrongly when it struck
out the appellants’ defence to the main application.
[17]
In this court, the cornerstone of the appellants’ argument was
that once criminal charges were reinstated, the interests
of justice,
policy and public considerations outweighed the interests of the
respondents. In essence the case advanced for the
appellants is that
the respondents did not suffer any prejudice as a result of the late
introduction of the rule 6(5)
(d)
(iii)
notice, because it was foreshadowed in the appellants letter dated 13
May 2014.
[18]
Properly understood, the argument of the appellants was the
following. The effect of the order of the striking out the defence
of
the appellants was that the items which were lawfully seized pursuant
to a valid search and seizure warrant would be returned
to the
respondents and other accused persons even though some of the accused
may not lawfully possess them, as there were no exceptional
circumstances warranting the return of the items at this stage. We
were urged to accept that the high court misdirected itself
when it
held that the merits of the main applications were irrelevant and the
point of law relating to civil declarators affecting
criminal
proceedings was unsustainable. In support of its argument reliance
was placed on
Wahlhaus & others v Additional Magistrate,
Johannesburg & another
1959 (3) SA 113
(A) at 118H-119I where
the court dealing with a civil declaratory order said the following:
‘
The
present case has no special features and cannot rightly be brought
within the ambit of the Johnstone & Co decision, supra.
Apart
from the fact that the petition neither referred to, nor sought any
relief by way of, a declaration of rights, it is clear
that the
present would not be a suitable case for the granting of the very
special relief entailed in the Court’s exercising
its
discretion under s 102 of Act 46 of 1935 to make a declaratory order
in relation to a criminal case. The appellants are alleged
to have
committed a crime. The normal method of determining the correctness,
or otherwise, of that allegation is by way of the
full investigation
of a criminal trial. There is a total absence of any of the types of
consideration which induced this Court
to make a declaratory order in
the Johnstone case supra. Nor, indeed does the case even contain any
law point which, if resolved
in appellant’s favour, would
dispose of the criminal charge, or a substantial portion of it.’
[19]
This view was endorsed in
NDPP
v King
[2]
where
this
court also expressed itself as follows:
‘
Fairness
is not a one-way street conferring an unlimited right on an accused
to demand the most favourable possible treatment, but
also requires
fairness to the public as represented by the State. This does not
mean that the accused's right should be subordinated
to the public's
interest in the protection and suppression of crime; however, the
purpose of the fair trial provision is not to
make it impracticable
to conduct a prosecution. The fair trial right does not mean a
predilection for technical niceties and ingenious
legal stratagems,
or to encourage preliminary litigation ─ a pervasive feature of
white collar crime cases in this country.
To the contrary: courts
should within the confines of fairness actively discourage
preliminary litigation. Courts should further
be aware that persons
facing serious charges ─ and especially minimum sentences ─
have little inclination to co-operate
in a process that may lead to
their conviction and 'any new procedure can offer opportunities
capable of exploitation to obstruct
and delay'. One can add the
tendency of such accused, instead of confronting the charge, of
attacking the prosecution.’
[3]
In
Van
der Merwe v National Director for Public Prosecutions
[2010]
ZASCA 129
;
2011 (1) SACR 94
(SCA) para 32, this court held that
litigation of this kind falls squarely into the category of
preliminary litigation that ought
to be avoided or discouraged.
[20]
The respondents’ counter argument was the following. Quite
correctly, they submitted that the appellants were not entitled
to
resort to rule 6(5)
(d)
(iii)
to place evidence before the court of the facts which should have
been placed by way of an opposing affidavit. The argument
advanced is
that the appellants’ sought to introduce evidential material
that would have been placed before the court by
way of an opposing
affidavit, thus denying the respondents the opportunity to deal with
these facts. It was contended that the
reinstitution of criminal
proceedings was a stratagem aimed at persuading the court that the
State was ready to proceed with the
trial when it was not. It was
further submitted that the appellants’ were not entitled to
seize and retain the items simply
because of a pending criminal
trial. The submission made in this regard was that the institution of
criminal prosecution does not
constitute a bar against the relief
sought. Correctly understood, the respondents pin their hopes on the
legal assertion that in
the main application, the State cannot prove
the criminal activity as alleged in respect of the items which the
respondents seek
to be returned to them. I do not agree. Amongst the
items sought to be returned are exhibits which are intended to be
used at the
pending criminal trial. Returning them to the respondents
will defeat the purpose for which they were secured.
[21]
What emerges clearly from the above-cases is that although there is
no absolute bar from adjudicating such issues during the
interlocutory applications, applications amounting to preliminary
litigation pending the outcome of criminal proceedings should
not be
encouraged as it is the duty of the criminal trial to deal with all
issues relating to the aspects that will affect the
criminal trial.
The duty to examine or adjudicate the lawfulness or otherwise of the
search and seizure resides with the trial
court. A decision by a
civil court to interfere with the trial court’s decision should
be exercised sparingly, in exceptional
circumstances. (See
Wahlhaus
).
In my view where a court is approached for a relief, as in the
present case, it must in the exercise of its discretion have recourse
inter alia to the following, (a) the main issues between the parties,
(b) return of items seized in connection with a criminal
trial; (c)
the reason why the documents cannot be furnished at that stage, (d)
the likely impact the release of the documents would
have on the
pending trial and (e) finally, the prejudice that may be suffered by
either party if the order is refused or granted.
[22]
The exhibits which have been seized are required by the State to
attempt to prove its case against the third and fourth respondents,
as well as other accused persons, and form an integral part of the
State’s case in the pending criminal trial. Returning
the items
seized to the respondents would seriously undermine and impact
negatively on the State’s case. There is no reason
to believe
that the respondents’ rights are under threat and neither will
their rights to a fair trial be infringed. In my
view no grave
injustice would result if the issues raised by the respondents in the
main application are determined by the trial
court. The respondents
will have an opportunity to challenge each and every aspect of the
warrants and evidence obtained against
them at the trial. It will be
for the trial court to decide whether the warrants and evidence were
unconstitutionally obtained,
and the trial court will decide whether
such evidence should be admitted or not.
[23]
It was thus necessary that the high court strike a balance between
the policy considerations, public interest, interests of
justice and
the rights of the respondents. In my view, the court a quo failed to
do so. It adopted the most draconian option of
striking out the
defence to the main application without affording the appellants the
opportunity to remedy their default. In terms
of rule 30A(2) it
should have exercised its discretion and ordered the appellants’
to comply with the request for discovery
in terms of rule 35(12) and
(13). Had there then been non-compliance with that order, the court
could on further application have
considered striking out the
defence. Such an approach would have been far more in accordance with
justice. As the high court did
not seek compliance with the rule but
ordered the striking out of the appellants defence, it misdirected
itself, entitling this
court to interfere with its order. For these
reasons, the appeal must succeed.
Costs
[24]
The high court ordered the appellants to pay the respondents costs on
a scale of attorney and own client. It was driven to
this conclusion
by the appellants’ misguided interpretation to the rules and
reliance on the
Stevens
case. I accept that the conduct of the appellants was less than
satisfactory and dilatory but that does not mean that it should
be
mulcted with a punitive costs order. In the circumstances an
appropriate costs order would be one on a party and party scale.
[25]
However, counsel for the appellants correctly conceded that in the
light of the woefully inept conduct of the appellants’
case,
including the necessity to seek condonation in this court, despite
their success the appellants ought not to be awarded their
appeal
costs. The effect of this is that each party would pay their costs of
appeal.
[26]
The following order is made:
1
The application for leave to appeal is granted.
2
The appeal is upheld.
3
Paragraphs 1, 2 and 3 of the order of the high court of 29 August
2014, dismissing the appellants’ application for condonation
and, striking out the appellants’ defence to the main
application are set aside and substituted with the following:
‘
1.1
The respondents are ordered to comply with the applicants’
notice in terms of rule 35(12) read with rule 35(13) of the
Uniform
rules within ten (10) days of this order.
1.2
In the event of the respondents failing to comply with paragraph 1.1
of the order, the applicants may apply on the same papers
duly
amplified to strike out the respondents’ defence to the main
application.
2
Late filing of the respondents’ rule 6(5)(d)(iii) notice is
condoned.
3
The respondents are to pay the costs of this application as well as
the costs of their application for condonation.’
_____________
R
S Mathopo
Judge
of Appeal
Appearances
For
Appellants
:
D
J Joubert
SC (with him M Kgomongwe)
Instructed by:
The State Attorney, Johannesburg
The State Attorney, Bloemfontein
For
Respondents:
D Dörfling SC
Instructed by:
Xenophontos
Attorneys, Johannesburg
Martins Attorneys, Bloemfontein
[1]
See
further
Moulded
Components & Rotomoulding South Africa (Pty) Ltd v Coucourakis &
another
1979 (2) SA 457
(W)
at 460H-461E.
[2]
National
Director of Public Prosecutions v King
[2010]
ZASCA 9
;
2010 (2) SACR 116
(SCA) para 5.
[3]
See
also
Mngomezulu
& another v National Director of Public Prosecutions &
another
[2007] ZASCA 129
;
2008 (1) SACR 105
(SCA) paras 12-14
.