Royal Square Investments 330 (Pty) Ltd v Premier, Western Cape and Another (A142/2020) [2021] ZAWCHC 68; [2021] 3 All SA 205 (WCC) (20 April 2021)

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[2021] ZAWCHC 68
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Royal Square Investments 330 (Pty) Ltd v Premier, Western Cape and Another (A142/2020) [2021] ZAWCHC 68; [2021] 3 All SA 205 (WCC) (20 April 2021)

Republic of South Africa
IN THE HIGH
COURT OF SOUTH AFRICA
WESTERN
CAPE DIVISION, CAPE TOWN
Appeal Case
no.: A142/2020
First instance
case no.: 23175/2017
Before: The
Hon. Mr Justice Binns-Ward
The Hon. Mr Justice Samela
The
Hon. Mr Justice Papier
Hearing:
22 January 2021
Judgment:  20
April 2021
In the matter
between:
ROYAL
SQUARE INVESTMENTS 330 (PTY)
LTD
Appellant
and
THE
PREMIER, WESTERN
CAPE
First Respondent
THE
MEC, TRANSPORT & PUBLIC WORKS (W. CAPE)
Second
Respondent
JUDGMENT
(Delivered
by email to the parties’ legal representatives and by release
to SAFLII.
The
judgment shall be deemed to have been handed down at 10h00 on
20 April
2021.)
BINNS-WARD J (SAMELA and PAPIER JJ concurring):
[1]
On 5 April 1973, the Administrator of the
Province of the Cape of Good Hope issued a proclamation (Proclamation
137 of 1973) which,
amongst other matters-
(i)
in terms of s 120 of the Divisional
Councils Ordinance 15 of 1952,
[1]
declared as a
main road
a stretch of land 22 kilometres in length that traversed the then
existing Cape and Stellenbosch Divisions and the then existing

Bellville, Kuils River and Brackenfell Municipalities, and
(ii)
in terms of s 1A of the Trunk Roads
Ordinance 28 of 1960,
[2]
declared such
main road
to be a
trunk road
.
[3]
The road in question is now known as the R300, and that is the label
by which I shall refer to it in this judgment.
[2]
The 1952 Divisional Councils Ordinance
defined ‘
main road
’
to mean ‘a road declared as such by or in terms of any law’.
It defined a ‘
proclaimed road
’
as ‘a main road or divisional road’ and a ‘
public
road
’ as ‘a proclaimed road
or a minor road’.  The net effect was that the R300
qualified as a ‘
public road
’
within the meaning of that term in the Ordinance.
In terms of s 127(2)(a) of the 1952 Divisional
Councils
Ordinance,
[4]
the responsibility for constructing the road over any part of the
R300’s route where no declared road already existed rested
on
the Administrator.  This incidence of the legislation was
underscored, in the case of a road also declared to be a trunk
road,
by the provisions of s 3 of the Trunk Roads Ordinance.
[5]
Construction of an actual roadway over the whole of the declared
route of R300 has not yet been completed.  It may be
inferred
that the declaration of the road along a line where no actual road
exists must have been in terms of s 120(4)(a)
of the
Ordinance.
[6]
[3]
The land that features in the current
litigation is situated on a part of the declared route of the R300 on
which nothing has as
yet been constructed.  The land in
question, currently
designated as Erven
12692 and 12693 Durbanville (‘the R300 erven’), was part
of Farms 311/57 and 311/61 Durbanville
at the time the Proclamation
was made.  The R300 erven are situated within what was the
jurisdictional area of the late Divisional
Council of the Cape at the
time the R300 was declared as a road.
[4]
Little could the Administrator have
imagined, when he issued the Proclamation 48 years ago, that
that part of it which provided
for the route of the R300 to traverse
portions of Farms 311/57 and 311/61 would give rise to the most
extraordinary amount of litigation;
see
Arun
Property Development (Edms) Bpk v Stad Kaapstad
2003 (6) SA 82
(C),
Arun Property
Development (Edms) Bpk v Stad Kaapstad
[2005] ZAWCHC 86
(15 November 2005),
City
of Cape Town v Arun Property Development (Pty) Ltd and Another
[2008] ZAWCHC 22
;
2009 (5) SA 227
(C) (7 May 2008),
Arun
Property Development (Pty) Ltd v City of Cape Town
[2012]
ZAWCHC 399
(31 October 2012),
City of
Cape Town v Arun Property Developments (Pty) Ltd
[2014] ZASCA 56
(16 April 2014) and
Arun
Property Development (Pty) Ltd v City of Cape Town
[2014] ZACC 37
(15 December
2014); 2015 (3) BCLR 243
(CC);
2015 (2)
SA 584
(CC).  For all I know there may even have been other
judgments in the course of the litigious history that have escaped my

notice.
[5]
In the current round of the ongoing
litigation, the appellant, Royal Square Investments 330 (Pty) Ltd (to
which, for convenience,
I shall refer as ‘the plaintiff’),
has brought an action for the following substantive relief (set forth
in prayers
(a) to (c) in the particulars of claim):
(a)
an
order declaring that the plaintiff is the owner of Erven 12692 and
12693 Durbanville;
(b)
an
order directing the defendant [by which is meant the first defendant,
the Premier of the Western Cape; alternatively, the second
defendant,
the MEC for Transport and Public Works in the Western Cape] to
purchase Erven 12692 and 12693 Durbanville from the plaintiff
for a
purchase price of R96 570 500 and generally in accordance
with the provisions of regulation 38 of the LUPO [Land
Use Planning
Ordinance 15 of 1985 (W. Cape)] Regulations and section 12 of the
Expropriation Act [Act 63 of 1975];
(c)
in
the alternative to (b):
an order
directing the defendant to pay compensation to the plaintiff in
respect of the constructive expropriation of Erven 12692
and 12693
Durbanville in the amount of R96 570 500.
This judgment is concerned with the determination of an appeal and a
cross-appeal from a judgment given at first instance (per
Dolamo J)
in respect of a number of exceptions noted by the defendants to the
plaintiff’s particulars of claim.
[6]
Farms 311/57 and 311/61 (subsequently
consolidated as Erf 10357, Durbanville) were rezoned and subdivided
for township development
purposes many years after the declaration of
the R300.  It is pleaded that the R300 erven were created when
they were subdivided
from ‘the development property’ on
or about 5 November 1999.  The erven are separated from
each other by
De Villiers Road; Erf 12692 is constituted by the
proclaimed R300 land to the north of De Villiers Road, and Erf 12693
is
the R300 land to the south thereof.  They remain vacant land.
[7]
The particulars of claim allege that the
aforementioned farms were owned by the University of Stellenbosch
when the Administrator
proclaimed the R300.  During the 1980’s
the University sought professional advice on the optimal future use
of the land.
It was advised that the land should be earmarked
for township development because it lay within the area into which
the nearby
town of Durbanville might be expected to expand.  The
University was told that various planning instruments related to the

land by virtue of decisions that had been made by the relevant
government authorities.  It was advised that, amongst other

matters, planning provision had been made for a network of higher
order roads across the land, including the declaration of the
R300.
[8]
The pleaded case is that the University was
informed that –
1.
the Metropolitan Planning Committee had, on
the instructions of the Administrator, compiled an urban structure
plan for the Cape
Metropolitan Area with a view to planning aspects
of future road networks, residential developments and other land uses
on an overarching
scale.
2.
in August 1986, the directorate of the Cape
Metropolitan Planning Committee recommended for approval the ‘revised
structure
plan – 1986 (Kuils River Valley North of the N1)’
(‘the Kuils River Structure Plan’).
3.
on 13 June 1988, the Provincial Executive
Committee, Cape of Good Hope, approved the overarching structure plan
for the area North
of the N1 (‘the 1988 structure plan’)
in terms of Section 4 (6) of LUPO.
4.
the Kuils River Structure Plan and the 1988
structure plan made provision for four classes of existing and
proposed roads of a ‘fundamentally
non-residential nature’,
namely –
(i)
trunk roads and major arterials (class 1
roads);
(ii)
primary distributors (class 2 roads);
(iii)
district
distributors (class 3 roads); and
(iv)
local
distributors (class 4 roads).
The R300 was reflected in ‘the Kuils River Structure Plan’
(in which it was referred to as ‘the proposed Cape
Flats
freeway’) and also in the ‘1988 structure plan’, as
well as in ‘certain transport plans established
for the Cape
Metropolitan Area in terms of the Urban Transport Act 78 of 1977’.
[9]
The University subsequently sold the still
undeveloped land to Arun Property Development (Pty) Ltd (‘Arun’).
Arun
took transfer in 1997.  It had similar advice
concerning the road planning decisions affecting the property.
It established
that the provincial and local authorities would not
approve any applications in respect of the development of the
property as a
township unless the development plan was compatible
with the applicable planning instruments, and, in particular, unless
the development
plan made provision for the contemplated network of
higher order roads, including the R300.
[10]
The currently existing township development
on the ‘development property’ was undertaken pursuant to
a series of so-called
‘development applications’ that had
over time been submitted by the University and Arun to the relevant
authorities.
These included an application, in 1991, to rezone
the land from agricultural use to subdivisional area in terms of s 22
of
LUPO
[7]
and a series of subsequent rezoning and subdivision applications
submitted with a view to obtaining approval for the undertaking
of
primarily residential development on the property in three phases.
[11]
The particulars of claim give the following
information concerning the so-called development applications:
1.
In September 1992, the application to
rezone the development property to subdivisional area was granted by
the provincial authorities,
specifically by the Ministerial
Representative, subject to certain conditions, including the
following:
1.1
‘
Toegang en paaie
:
Toegange en paaie moet gekoördineer word
met die plaaslike owerheid by die beplanning daarvan en waar toegang
vanuit ’n
aangrensende plaaslike owerheidsgebied of ’n
geproklameerde hoofweg beplan word, moet bewys van die nodige
skakeling met
sodanige instansie tesame met die finale beplanning
ingedien word
’
(condition 8);
[8]
1.2
‘
Struktuurplan voorstelle
:
Die algemene beplanning, onderverdeling en
ontwikkeling van die eiendom is verder onderhewig aan die algemene
bepalings van die
goedgekeurde strukteerplan van toepassing op die
eiendom ...
’
(condition 9)
[9]
2.
On 20 February 1998 and 19 March 1998, the
subdivision and rezoning applications in respect of Phase 1 of the
development were approved
by the local authority, subject to certain
conditions including the following:
‘
Vehicular Access
:
No direct vehicular access shall be permitted
off Trunk Rd 81 (R300), Brackenfell Boulevard, Golf Course Road and
Langeberg Road
’
.
3.
On 8 October 1998, 25 October 1998 and 15
December 1999, the subdivision and rezoning applications in respect
of Phase 2 of the
development were approved by the local authority.
4.
On 12 April 2002, the subdivision and
rezoning applications in respect of Phase 3 of the development were
approved by the local
authority.
[12]
It will be noted that none of the pleaded
dates of subdivisional approval in respect of the respective
subdivisions that constituted
the three phases of the development
corresponds with the pleaded date of the subdivision in terms of
which the R300 erven were
created.
[10]
[13]
The plaintiff is a related company to Arun,
having the same shareholders and directors.  The plaintiff
acquired registered
ownership of the R300 erven from Arun.  It
took transfer of them from Arun in December 2008 ‘as part of a
restructuring
of the group of companies’.
[14]
It is alleged that confirmation of the
respective subdivisions constituting the three aforementioned phases
of the development duly
occurred, as contemplated in s 27 of
LUPO,
[11]
and that by no later than 24 March 2009, more than 50% of the total
number of saleable land units in the subdivisions had been
sold.
[15]
It is apposite to mention at this stage
that the 1952 Divisional Councils Ordinance was repealed in terms of
s 218 of the Divisional
Councils Ordinance 18 of 1976 and the
Trunk Roads Ordinance was repealed by s 67 of the Roads
Ordinance 19 of 1976.
The 1976 Divisional Councils Ordinance
and the Roads Ordinance both came into operation on 1 January 1977.
The plaintiff
recorded in its particulars of claim that in terms of
s 66(4) of the Roads Ordinance, 1976, any proclamation issued
under
the provisions of any law repealed by the Roads Ordinance,
1976, or the
Divisional Councils Ordinance,
1976 was deemed to have been issued in terms of the Roads Ordinance,
1976.  It is relevant,
however, to have wider regard to s 66,
which insofar as currently pertinent provides:
66.
Savings.—
(1) Every trunk road, main road,
divisional road, minor road or road of necessity and public path
lawfully in existence immediately
prior to the commencement of this
ordinance shall be deemed respectively to be a trunk road, main road,
divisional road, minor
road or public path declared and classified as
such under this ordinance and the person who, immediately prior to
such commencement,
was responsible for the construction,
reconstruction, maintenance, repair and improvement of any such
public road or public path
shall, subject to the provisions of this
ordinance or any proclamation or notice issued hereunder, be deemed
to be the road authority
for such public road or public path;
provided that where a municipal council other than a village council
was immediately prior
to such commencement the road authority for a
public road, road of necessity or public path in its outer municipal
area, the divisional
council in whose divisional area such outer
municipal area is situate shall be deemed to be the road authority
for such road or
path.
(2) ...
(3) ...
(4) Any proclamation, notice,
certificate or other document issued, any direction, approval,
permission or authority given, any
appointment or regulation made or
any other action taken or thing done under the provisions of any law
repealed by this ordinance
or the Divisional Councils Ordinance, 1976
(Ordinance 18 of 1976) shall be deemed to have been issued, given,
made, taken or done
under the provisions of this ordinance.
(5) Any expropriation commenced
by a road authority or proceedings for the determination of
compensation instituted by or against
a road authority prior to the
commencement of this ordinance shall be continued as if this
ordinance has not been passed; provided
that the parties concerned
may agree to proceed with such expropriation or proceedings in
accordance with the provisions of this
ordinance in which case the
provisions of this ordinance shall apply to such expropriation or
proceedings as if it or they had
commenced or been instituted in
terms of this ordinance.
The Administrator was thereby deemed to be the relevant road
authority in respect of the R300.  It is not in issue that the

first defendant (the Premier) has since assumed the relevant powers
and responsibilities of the erstwhile Administrator.
[16]
The claim for the declaratory order sought
in respect of the ownership of the R300 erven sought in terms of
prayer (a) of the particulars
of claim is being made because, so the
plaintiff
pleads, ‘the defendant’
contends that ‘
the R300 land
vested in the first and second defendants as the road authority by
virtue of Proclamation 137 of 1973 and in terms
of section 145
of the Divisional Councils Ordinance of 1952
’.
[17]
Section 145 provided:
The
ownership of all public roads and public paths, as well as the land
occupied thereby, shall vest in the council: provided that
if any
such road or path is closed, diverted or reduced in width, the land
thereby ceasing to be occupied by a road or path, together
with the
works and things attached·to such land, shall continue so to
vest in the council unless, if it is not registered
in the name of
the council, the Administrator by notice in the Provincial Gazette
directs that such land or portion thereof, together
with the works
and things attached thereto, shall pass to and vest in the owner of
the property of which such land originally formed
part
.
(The provision has effectively been repeated in s 22 of the
currently applicable Roads Ordinance, 1976.)
[18]
The plaintiff has pleaded that, as Arun’s
successor in title, it is the owner of the R300 erven by virtue of
the following
considerations:
1.
The proclamation of a road (including
proclamation of a road in terms of the Divisional Councils Ordinance
of 1952 and/or the Roads
Ordinance of 1976) constitutes advanced
notification of a public authority’s intention to implement a
road scheme over the
land in question.
2.
The mere proclamation of a road (including
proclamation of a road in terms of the Divisional Councils Ordinance
of 1952 and/or the
Roads Ordinance of 1976) does not bring about the
vesting of the land in question in the public authority.
3.
In order for the land in question to vest
in the public authority, the authority must acquire the land for the
purposes of a road
scheme (or for some other public purpose), which
it does by purchasing or expropriating the land subject to payment of
compensation.
4.
The R300 properties have not been purchased
or expropriated
[19]
The plaintiff claims that, as the owner of
the R300 erven, it is entitled to an order, as prayed in terms of
prayer (b) of the summons,
directing one or other of the defendants
to purchase the erven.  It relies on regulation 38 of the
regulations made under
LUPO in this regard.  Regulation 38
fell to be read with regulation 37, and also with s 28 of the
Ordinance.
[20]
The LUPO regulations provided as follows:
37.    Where land in a subdivision is
required by a local authority in connection with the supply of
services for
purposes directly related to the needs arising from the
said subdivision, such land shall be surrendered to the local
authority
free of charge.
38.    Where land in a subdivision is
required by any other authority for a purpose other than that
referred to in
regulation 37 (excluding land required to be
surrendered in terms of Section 28 of the Ordinance), it shall be
purchased by the
relevant authority at the market value applicable to
the total land unit; provided that such authority shall not be
obliged to
purchase the land until such time as the owner can prove
that 50of the total number of saleable land units in the relevant
subdivision
have already been sold; provided further that if any
dispute arises between the owner of the relevant land and any
authority over
any matter in terms of this regulation, any of the
parties involved may refer such dispute to the chief director for
submission
to an appeal committee in terms of section 43(2)(c) of the
Ordinance.
[21]
Section 28 of LUPO provided:
Ownership, on subdivision, of public streets and
public places.
The ownership of all public streets and public places
over or on land indicated as such at the granting of an application
for subdivision
under section 25 shall, after the confirmation of
such subdivision or part thereof, vest in the local authority in
whose area of
jurisdiction that land is situated, without
compensation by the local authority concerned if the provision of the
said public streets
and public places is based on the normal need
therefor arising from the said subdivision or is in accordance with a
policy determined
by the Administrator from time to time, regard
being had to such need.
[22]
The plaintiff has alleged that the
reservation of Erven 12692 and 12693 for the construction of the R300
by virtue of the Administrator’s
Proclamation and the
subsequently adopted planning instruments, which the rezoning and
subdivision of the development property
had to accommodate, is
‘
unrelated to the normal need for
public streets serving the development and was and is instead
required for a road network planned
for and serving the region as a
whole
’.  It alleges that the
R300 erven are therefore ‘
land in
a subdivision ... required by any other authority for a purpose other
than that referred to in regulation 37
’,
as contemplated in regulation 38 of the LUPO regulations.
[23]
The particulars of claim go on to allege
that ‘(i)
n terms of section 26(3)
of the Expropriation Act ..., where land is in terms of an ordinance
declared to be a road or acquired
for a road without being
expropriated, the compensation to which the owner is entitled shall
be calculated, determined and paid
in accordance with the provisions
of section 12 of that Act, notwithstanding anything to the contrary
contained in the ordinance
’.
The amount claimed by the plaintiff in terms of prayer (b) of the
summons is the product of a computation in terms
of s 26(1)
read
with s 12 of the Expropriation Act 63 of 1975, which the
plaintiff alleges affords the appropriate way to quantify its

entitlement in the circumstances.  Section 12 of the
Expropriation Act is one of the provisions in the Act that prescribe

how the amount of compensation payable in respect of expropriated
land falls to be computed.
[24]
Section 26 of the Expropriation Act
provides as follows:
Application of Act
(1) Subject to the provisions of section 5, the
provisions of this Act shall not derogate from any power conferred by
any other
law to expropriate or take any property or to take the
right to use property temporarily, but shall not preclude the
expropriation
or the taking of property or the taking of any such
right being effected either under the said provisions or under the
said power:
Provided that if any such power is exercised after the
commencement of this Act, the compensation owing in respect thereof
shall
mutatis mutandis be calculated, determined and paid in
accordance with the provisions of this Act.
(2) ......
(3) In the case of land which is in terms of an
ordinance declared to be a road or acquired for a road without such
land being expropriated,
the following provisions shall apply,
namely-
(a)
notwithstanding anything to the contrary contained in any such
ordinance-
(i)
the compensation to which the owner is entitled, shall be calculated,

determined and paid in accordance with section 12, as if the land to
which the declaration or acquisition relates had been expropriated
in
terms of the provisions of this Act;
(ii)
no compensation shall be paid in respect of land which at the time
of
the declaration or acquisition already existed, or was being used, as
a road; compensation in respect of unregistered rights
shall be paid
in accordance with section 13;
(iv)
the amount of the compensation shall be determined in terms of
section
14, if the amount of the compensation cannot be agreed upon;
(v)
the rights to precious metals, precious stones, base minerals and

natural oil shall continue to vest in the person (including the
State) in whom they vested prior to such declaration or acquisition;
(vi)
the date on which the province becomes liable for the payment of
compensation
in terms of the provisions of the ordinance in question
shall be regarded as the date of expropriation;
(vii)
the executive committee shall within sixty days of the declaration of
the
land to be a road, notify the owner thereof, mutatis mutandis in
the manner contemplated in section 7, if the land was not already
a
road at the time of the declaration;
(viii)        the
executive committee shall furnish the local authority (if any) in
whose area
of jurisdiction the land is situated and the Registrar of
Deeds in whose deeds registry the title deed to the land is
registered,
with a copy of the notice referred to in subparagraph
(vii); and
(b)
the Registrar of Deeds referred to in paragraph (a) (viii) shall
on
receipt of the said copy cause an appropriate endorsement of the
declaration of the land to be a road to be made in his registers.
(4) ......
(5) If any land is expropriated after it had been
declared to be a public road and the provisions of subsection (3)(b)
complied
with in respect thereof, the endorsement referred to therein
shall serve as a note contemplated in section 31(6)(a) or 32(5), as

the case may be, of the Deeds Registries Act, 1937 (Act 47 of 1937).
(6) If an executive committee is in terms of the
ordinance in question required to expropriate any land for a road
after the declaration
thereof to be a public road, it may act in
accordance with the provisions of subsection (3) (a)(vii) and (viii).
(7) An executive committee may, in respect of any land
which was prior to the commencement of this subsection declared to be
a road,
request the Registrar of Deeds concerned to have such an
endorsement made in his registers as is contemplated in subsection
(3)
(b), notwithstanding that the executive committee is not required
to do so.
The date of commencement of the Expropriation Act was 1 January 1977.
[25]
At the date that the Land Use Planning
Ordinance came into effect, and prior to its substitution in terms of
s 24 of the Expropriation
Amendment Act 45 of 1992, with effect
from 1 May 1992, s 26 of the Expropriation Act had provided as
follows:
(1)
The provisions of this Act shall not derogate from any power
conferred by any other law
to expropriate or take any property or to
take the right to use property temporarily: Provided that, subject to
the provisions
of subsection (2), if any such power is exercised
after the commencement of this Act, the expropriation or the taking
of the property
or the taking of the right to use the property
temporarily, and the determination of the amount of the compensation
therefor, shall
be effected,
mutatis mutandis
, in
accordance with the provisions of this Act.
(2)
Subject to the provisions of subsections (3) and (4), the provisions
of this Act shall not
derogate from the provisions of any other law
relating to the taking or use or expropriation of property by a
provincial administration
or a local authority for the purposes of
the construction or maintenance of a public road or the taking or use
of property by a
provincial administration or a local authority for
the purposes of the construction or maintenance of any water,
electricity, drainage
or sewerage works, and the provisions of this
Act shall not apply to the taking or use of property by the Rand
Water Board in terms
of section 24 (b) or (j) of
the Rand Water Board Statutes (Private) Act, 1950 (Act 17 of 1950),
or any expropriation
in terms of section 120 of the Precious Stones
Act, 1964 (Act 73 of 1964), or section 183 of the Mining Rights Act,
1967 (Act 20
of 1967).
(3)
If compensation is to be paid for the taking or use or expropriation
of any property contemplated
in subsection (2), and the amount of
such compensation is not agreed upon, the provisions of section 14
shall mutatis mutandis apply
in connection with the
determination of such amount.
(4)
The amount of compensation paid or determined for the taking or use
or expropriation of
property contemplated in subsection (2) shall not
be more than what it would have been had it been calculated in
accordance with
the provisions of section 12 (1), (2) and (5).
[26]
Section 130 of 1952 Divisional Councils
Ordinance empowered councils to ‘
take
’
any land ‘
for the purposes of
public road
s’.  In terms of
s 131, councils were empowered, if so required by the owner
thereof, to pay compensation for any
land so taken.  The
compensation fell to be determined as provided for in s 132.
The taking provisions in the Divisional
Councils Ordinance were
substituted by the provisions of Chapter III of the Roads Ordinance,
which provided for the expropriation
of land ‘
for
road purposes
’.
[12]
The provisions in Chapter III concerning the computation of
compensation for expropriated land were immediately superseded
by
s 26 of the Expropriation Act, which happened to come into
operation on the same day as the Ordinance did.
[27]
The alternative claim to that in prayer
(b), advanced in prayer (c) of the summons, is for compensation for
what is alleged to be
the ‘constructive expropriation’ of
the R300 erven.  The alternative claim is pleaded as follows in
para 49-54
of the particulars of claim:
49.
As
a result of the provision for the network of higher order roads
running across the development property, as contained or contemplated

in or required by Proclamation 137 of 1973 and/or the planning
instruments and/or the subdivisional rezoning approval:
1.
the plaintiff (and/or its predecessor in title, Arun) was and is
precluded from
undertaking any development on the R300 land;
2.
the plaintiff (and/ its predecessor in title, Arun) was and is unable
to use
the R300 land for any purpose ordinarily forming part of the
exercise of the right of ownership;
3.
the R300 land has been sterilized and the plaintiff's right of
ownership and
the ordinary common law incidences, competences and
privileges forming part of the right of ownership in respect thereof
have been
made worthless to the owner;
4.
the R300 land has become unmarketable and has no value to the owner,
alternatively
a negligible value.
50.
The provision of the network of higher order roads running across the
development property,
as contained or contemplated in or required by
Proclamation 137 of 1973 and/or the planning instruments and/or the
subdivisional
rezoning approval constituted and/or resulted in a
taking of the R300 land, alternatively of the plaintiff's right of
ownership
and of the incidences and/or competences and/or privileges
ordinarily associated with such right.
51.
Such effective taking –
1.
was done by a public authority acting in terms of the Divisional
Councils Ordinance
of 1952 and/or the Trunk Roads Ordinance of 1960
and/or LUPO
2.
was done by or on behalf of the first defendant and/or the second
defendant;
3.
was done for a public purpose and in the public interest, namely for
the purpose
of public roads and/or forward planning in respect of
public roads to serve the region as a whole.
52.
In the premises:
1.
The effective taking constituted a constructive expropriation of the
R300 land.
2
Compensation is payable for the taking in terms of section 25 of the
Constitution.
53.
The amount of such compensation is to be calculated, determined and
paid in accordance with
the provisions of section 25(3) of the
Constitution, which provides as follows:
‘
(3) the
amount of compensation and the time and manner of payment must be
just and equitable, reflecting an equitable balance
between the
public interest and the interests of those affected , having regard
to all relevant circumstances including ,
(a)
the
current use of the property;
(b)
the
history of the acquisition and the use of the property;
(c)
the
market value of the property;
(d)
the
extent of direct state investment and subsidy in the acquisition and
beneficial capital improvement of the property; and
(e)
the
purpose of the expropriation.
’
54.
The value as set out in paragraph 48 [R96 570 500]
represents just an equitable
compensation, reflecting an equitable
balance between the public interest and the interests of those
affected, having regard to
all relevant circumstances, including
those listed in section 25(3)((a) to (e) of the Constitution.
[28]
The defendants excepted to the plaintiff’s
particulars of claim on the following grounds:
1.
All of the relief sought in terms of the
summons was dependent upon the plaintiff establishing that it was the
owner of the R300
erven.  The defendants alleged that it was
evident, by virtue of the following considerations, that the
plaintiff ‘
could not, and did not
acquire ownership of the R300 properties
’:
(i)
The effect of Proclamation 137 of 1973 was
to make the land identified in the proclamation ‘a public
road’.  In
terms of s 145 of the Divisional Councils
Ordinance 1952 ownership of all public roads ‘
vest
(s)
in the council
’.
(ii)
In addition, the Proclamation declared the
R300 to be a trunk road within the meaning of the Trunk Roads
Ordinance 28 of 1960.
Section 7
ter
of that ordinance vested ownership of all trunk roads constructed by
the Administrator, or for the maintenance of which he was

responsible, as well as the land occupied thereby, in the
Administrator.
(iii)
The Proclamation had also increased the
declared road beyond the statutory width for such roads.  The
notice of exception recorded
that s 134(1) of the 1952
Divisional Councils Ordinance had provided that ‘
(f)or
the purpose of increasing the width of a public road to its statutory
width, a council –(a)
shall
,
where the boundaries of the statutory width have been defined under
sub-section (2) of section one hundred and thirty-three,
take
the additional land
in
accordance with the boundaries so defined
’.
[13]
Furthermore, in terms of s 130(4) of
the said Ordinance, ‘(i)
f,
in
accordance with the provisions of subsection (1), land is taken by a
council .... all rights and interests in respect of such
land vested
in any person other than the council shall be deemed to have been
extinguished, ...
’
.  (‘The
first ground of objection.’)
2.
Insofar as the plaintiff relied on the
provisions of s 66(4) of the Roads Ordinance 19 of 1976, which
deemed any proclamation
issued under the (then repealed) 1952
Divisional Councils Ordinance and/or the
(then also repealed) Trunk Roads Ordinance to have been issued under
the 1976 Roads Ordinance,
the defendants contended that (i) as
the 1976 Roads Ordinance did not have retrospective effect, the
Administrator had not
been required to purchase or expropriate the
R300 land in terms of the Roads Ordinance following its coming into
effect and (ii)
as s 66(4) of the Roads Ordinance did not
alter the fact that the 1973 Proclamation included the R300
properties, no part
of the R300 erven remained capable of ‘
a
further act of expropriation
,
following the 1973 Proclamation
’.
(My underlining, for emphasis.)  (‘The second ground of
objection’.)
(The first and second grounds of objection were directed at the
plaintiff’s claim in prayer (a) of the summons.)
3.
The LUPO regulations are not applicable.
This is, so contend the defendants, because the 1973 Proclamation
predated LUPO,
which only came into operation on 1 July 1986.
The Proclamation is deemed to have been made in terms of the 1976
Roads Ordinance.
LUPO ‘
makes
no reference to the proclamation of roads or to any purpose other
than land use planning through structure plans, zoning schemes
and
subdivision of land
’.  LUPO
does not operate with retrospective effect and therefore does not
apply to the 1973 Proclamation.  (‘The
third ground of
objection’.)
4.
The fourth ground objection was advanced on
the basis that even if the LUPO regulations did apply, the pleaded
particulars did not
‘
sustain a
case under Regulation 38
’.
(‘The fourth ground of objection’.)
5.
Insofar as the plaintiff’s claim in
terms of prayer (b) is premised on the Expropriation Act, the
defendants contended that
the 1975 Expropriation Act did not apply
with retrospective effect to the 1973 Proclamation.  (“the
fifth ground of
exception’.)
(The third to fifth grounds of objection were directed at the claim
in prayer (b) of the summons.)
6.
The sixth ground of objection was framed as
follows in the notice of exception:
‘
18.
At
paragraph 52 of the POC, the Plaintiff alleges that the 1973
Proclamation resulted in a constructive expropriation of the R300

properties, which is compensable in terms of section 25 of the
Constitution, 1996.
19.    However,
as a function of legality, the constitutionality of the 1973
Proclamation must be determined with
reference to the Constitution of
the Republic of South Africa Act, 1961. Section 25 of the
Constitution, 1996, finds no application
on the facts.
20.    In any
event, section 25 of the Constitution, 1996, does not guarantee
compensation for constructive expropriation
or regulatory takings.
21.    The
Plaintiff’s POC, therefore, cannot sustain a case under Claim
C.’
(The sixth ground was directed at the pleaded claim in support of the
relief sought in terms of prayer (c) of the combined summons.)
[29]
The defendants also excepted on the ground
that the pleading was vague and embarrassing and that they were
consequently ‘prejudiced
in their ability to plead to’
it.  The notice of exception provided no particularity in
support of that complaint.
[30]
In a judgment delivered on 28 August
2019, the court a quo dismissed the exception based on the first and
second grounds of
objection, but upheld the defendants’
exceptions to the claims pleaded in support of prayers (b) and (c) of
the summons.
Dolamo J subsequently granted leave to the
plaintiff to appeal to the full court against his order upholding the
exceptions.
Leave to cross-appeal was also granted to the
defendants in respect of the dismissal of their exception to the
claim for a declaratory
order in terms of prayer (a) of the summons.
It was common ground between the parties, correctly so in our
judgment, that
the court a quo’s refusal to uphold the
exception on the other grounds was an appealable decision in the
peculiar circumstances;
cf.
Minister of
Water and Environmental Affairs and Another v Really Useful
Investments No 219 (Pty) Ltd and Another
[2016] ZASCA 156
(3 October 2016);
[2017] 1 All SA 14
(SCA);
2017 (1)
SA 505
(SCA) in para 2, citing
Makhothi
v Minister of Police
1981 (1) SA 69
(A)
(which, at 73A-B, refers to
Blaauwbosch
Diamonds Ltd v Union Government
1915 AD
599
at 601).
[31]
It would be logical, by virtue of the fact
that the relief sought by the plaintiff in terms of prayer (b),
alternatively (c), of
the summons hinges on it being the owner of the
R300 erven, to deal first with the defendants’ cross-appeal
against the dismissal
by the court a quo of the first ground of
objection advanced in the notice of exception.  It will be
recalled that, in essence,
that ground of objection was predicated on
the defendants’ construction of s 145 of the 1952
Divisional Councils Ordinance.
The contention was that it
followed from the provision in that section that ‘(t)
he
ownership of all public roads and public paths, as well as the land
occupied thereby, shall vest in the council
’
that from the moment of the declaration of the R300 as a public road
the University had been divested of ownership of that
part of its
property over which the declared route of the intended road was to
run (i.e. what has since become the R300 erven)
and full dominion
thereof transferred to the road authority.  It was necessarily
implicit in the defendants’ argument
that a declaration of a
public road in terms of s 120 of the Ordinance resulted ipso
facto in the expropriation of the
affected
land without compensation.  The reference in the second ground
of objection to the R300 erven not being susceptible
to ‘
a
further act of expropriation
’
confirms as much.
[14]
[32]
The court a quo upheld the plaintiff’s
counsel’s argument that the construction contended for by the
defendants was
demonstrably incorrect if s 145 were construed,
as it obviously should be, consistently with the well-established
principles
of contextual interpretation.
[15]
The court a quo was also mindful of ‘
the
well settled interpretive canon that legislation may not be construed
to permit confiscation of land without compensation unless
it so
provides in clear terms
’.
[16]
No attention was given by the court a quo or the litigants to a
reported judgment of the Eastern Cape Division in respect
of the
construction of the 1952 Divisional Councils Ordinance that runs
against the meaning contended for by the defendants and
lends support
to the conclusions of the court a quo on this aspect of the case.
In
Le Grange v Sterkstroom Divisional
Council
1970 (1) SA 1
(E) at 4E-H,
Kannemeyer J held that the expression ‘
for
the purposes of public roads
’ in
s 130(1) related to the taking of land ‘
in
order that it may be used as public road
’.
Kannemeyer J considered that the phrase ‘
the
purposes of public road
s’ related
to the carrying out by divisional councils of their ‘
duties
and powers in connection with the construction, maintenance, repair
and improvement
’ of public roads
provided for in s 126 of the Ordinance.  If the effect of a
declaration in terms of 120 were to
vest the land in the road
authority, it would obviously not be necessary for the council to
take it for the purpose of constructing
the road, and s 130
would, in the context postulated by the learned judge, be redundant.
The judgment in
Le Grange
is
not binding on this court but, as an existing authority on one of the
questions before us, it would be remiss of us not to have
careful
regard to it.  It is persuasive, in my respectful view.
[33]
The plaintiff’s counsel argued that a
number of contextual indicators in the legislation served to
demonstrate the fallacy
in the construction for which the defendants
contended.  In my judgment, their argument was well-made.
Reference to
only a few provisions of the 1952 Divisional Councils
Ordinance is sufficient to show that the defendants’ contention
that
s 145 was intended to give a proclamation of a public road
in terms of s 120 of the Ordinance an expropriating effect if the

affected land was in private ownership is misconceived.
[34]
Section 146(2) of the Ordinance prohibits
the owner of any land from building or permitting any person to erect
a building ‘
on
his
land
, if such land falls within
the statutory width of
a
proclaimed road
or the width of
a declared road,
[
[17]
]
but has
not
yet been taken for the purposes of such road
,
except with the approval of, and in accordance with plans approved by
the local authority and the Administrator
’.
The plain wording of the provision, highlighted by the words I have
underlined, is irreconcilable with the notion
that the mere
declaration of a road vests
ownership
thereof in the Administrator or the council.  Its unambiguous
import is that a declared road remained the property
of its
registered owner until and unless the land constituting it was taken
from the owner for the purposes of the road.
[18]
[35]
That that was so was underscored by the
link in the proviso to s 146(2) to s 131(4) and the second
proviso in s 148(1).
The proviso to s 146(2) went as
follows: ‘
...
provided
that nothing herein contained shall be construed as derogating from
the provisions or sub-section (4) of section one hundred
and
thirty-one and the second proviso to sub-section (1) of section one
hundred and forty-eight
’
.
Section 131 was the provision in the Ordinance that regulated the
payment of compensation by a divisional council in respect
of the
taking, in terms of s 130, of any land for the purposes of
public roads and public paths.  Subsection 131(4) prohibited,

save with the prior permission of the Administrator, the payment of
compensation by a council for improvements effected to land
taken for
road purposes if such improvements were made within the statutory
width of a road any time after the statutory width
of the road had
been fixed.  The second proviso to s 148 was an equivalent
provision to s 131(4) that applied in
respect of the payment of
compensation for land within an urban local authority area taken for
road purposes.
[36]
The words ‘take’
and ‘taking’ are commonly used synonymously with
‘expropriate’ and ‘expropriation’.
It
is plain from the context that that is how they were used throughout
Chapter X (ss 119-149) of the Ordinance, which, as
its title
suggests, is devoted to roads.  It is confirmed in s 148(1),
where it is provided that in ‘
inner
municipal areas
’
[19]
‘
the
provisions of Chapter X of the Municipal Ordinance, 1951 (Ordinance
No. 19 or l951),
relating
to the expropriation of land
and the payment or compensation therefor shall apply, instead or the
provisions of sections one hundred and thirty, one hundred
and
thirty-one and one, hundred and thirty-two of th
(e)
Ordinance
’.
[37]
Section 136
bis
of the 1952 Divisional Councils Ordinance is another provision that
serves to confirm that privately owned land on which proclaimed
roads
fall to be constructed needs first to be taken by roads authority for
that purpose.  The section provides as follows:
Notwithstanding anything to the
contrary contained in any other provision, a council may where a
vineyard, an orchard, a plantation
or irrigated land adjoins a
proclaimed road, provisionally take only so much land (hereinafter
referred to as the provisional width,
as the Administrator may
approve and in such event the provisions of this Chapter relating
to
the taking of land for the construction
or widening
of
,
and the: erection and re-erection of fences along,
proclaimed
roads
shall, until the Administrator directs otherwise,
mutatis
mutandis
apply in respect of such provisional width.
The underlined wording confirms that the mere declaration of a
proclaimed road did not vest ownership in a council.  If the

road was yet to be constructed, the land over which it was to run
needed to be taken for that purpose if it did not already belong
to
the council.  It is clear that ‘the provisional width’
referred to in this section contemplates a narrower
length of land
than that comprising the road’s full ‘statutory width’.
This demonstrates that the defendants’
contention that it was
only necessary to take land for road purposes where the declared
width was wider than the standard statutory
width cannot be sustained
on a contextual reading of Chapter X of the Ordinance.
[38]
Section 130(4) of the Ordinance provided
that it was upon the taking of the land for road purposes in terms of
s 130(1) that
‘
all rights and
interests in respect of such land vested in any person other than the
council shall be deemed to have been extinguished
’.
Section 130 therefore provided for the extinction of owner’s
proprietary rights in the taken land, and s 145
for the vesting
of them in the council.  The two provisions were complementary.
It is necessary for governmental purposes
to identify in which organ
of state expropriated property resorts.  Section 145 addressed
that issue in respect of roads for
which a divisional council was the
road authority, just as ss 7(1) and 7
ter
did in respect of public roads that had been declared as trunk roads.
[39]
Indeed, in the current case it should not
be overlooked that the R300 was also declared to be a trunk road.
The combined effect
of ss 120(4)(a) and 127(2)(a) of the 1952
Divisional Councils Ordinance and ss 3, 7 and 7
ter
of the Trunk Roads Ordinance was that
were the R300 constructed over land where there was no existing road
when the proclamation
was made, the Administrator, rather than the
divisional council or municipality concerned, would be the
responsible authority for
taking the required land, which would
thereupon
vest in the Administrator, not the council.  Section 7(1) of
Trunks Road Ordinance provided that in this regard the Administrator

had the powers, rights and duties conferred by law on the divisional
council.  The relevant powers, rights and duties were
those
conferred in terms of Chapter X of the 1952 Divisional Councils
Ordinance.  The defendants’ argument that s 130
of
the 1952 Divisional Councils Ordinance did not empower
the
Administrator
to take land ‘for
the purposes of public roads’ was accordingly misconceived.
[40]
The effect of s 66(4) of the Roads
Ordinance was that the R300 fell, with effect from 1 January
1977, to be regarded as
if it had been proclaimed in terms of the
Roads Ordinance.  It was accordingly deemed to have been
classified as a trunk road
and a main road in terms of s 4 of
the new ordinance.  The Roads Ordinance remains in force.
[41]
Any taking of land necessary to construct
the road is therefore now regulated by Chapter III of the Roads
Ordinance read with s 26(3)
of Expropriation Act.  The
notion that an expropriation of the R300 erven in terms of the Roads
Ordinance would be ‘
a further act
of expropriation
’ is erroneous
because the erven had not been taken for road purposes under the
previously subsisting legislation, the 1952
Divisional Councils
Ordinance.  Retrospectivity therefore does not present as a
question for consideration.  The
evident object of s 66(4) was to ensure that practical issues
concerning roads proclaimed
under the repealed legislation could be
addressed in terms of the substituting ordinance.  It is in the
nature of a transitional
provision; one directed at regulating the
practical consequences of dealing with uncompleted business commenced
under a statutory
instrument that is replaced by another.
[42]
The plaintiff’s counsel also argued,
and the court a quo appeared to agree, that the judgment of the
appeal court in
Steinberg v South
Peninsula Municipality
[2001] ZASCA 93
(19 September
2001); 2001 (4) SA 1243
(SCA) and the dictum of
Moseneke DCJ in the Constitutional Court’s judgment in
Arun
Property Development
supra, at para 35,
apropos a higher-order road provided for in terms of a structure
plan, that ‘(w)
hen the local
authority resolves that the time has come to build the road, the land
must be expropriated and compensation must be
paid to the owner
’
supported the correctness of the construction of the pertinent
provisions of the 1952 Divisional Councils Ordinance for
which they
contended.  The defendants’ counsel countered that neither
of those authorities was in point:  the question
in
Steinber
g’s
case fell to be determined with reference to the Roads Ordinance,
1976, and the Constitutional Court in
Arun
Property Development
was concerned with
LUPO, not the Divisional Councils Ordinance.
[43]
I am inclined to agree that we should be
careful not to read too much into the dictum in
Arun
Property Development
.  There is
nothing in the judgment to indicate that the learned deputy chief
justice had any particular provision of the Divisional
Councils
Ordinance in mind when he uttered the words on which the plaintiff’s
counsel place reliance.  The position
with regard to the
judgment in
Steinberg
is different, however.  Whilst it is true that the statutory
context in that case was the Roads Ordinance, the findings by
the
appeal court as to the character of the pertinent statutory scheme
are nevertheless germane because the scheme in issue was
directed at
the same subject matter previously regulated by Chapter X of the 1952
Divisional Councils Ordinance.  A comparative
analysis shows
that, in the respects relevant to the current case, the scheme
evident in the 1952 Ordinance was transposed in essentially
unaltered
form to the 1976 Roads Ordinance.  Thus, ss
3
and 4 of the Roads Ordinance corresponded in all material respects
with s 120 of the 1952 Ordinance, s 17 with s 146,

s 22 with s 145, and s 27 with s 130.  The
equivalence between the instruments is far wider than just
in the
respects that I have illustrated.  I picked out only the four
aforementioned points of correspondence because of their
particular
relevance to the issue under consideration.
[44]
The issue in
Steinberg
concerned a claim for compensation for the ‘constructive
expropriation’ of land situate within or adjacent to a
proclaimed
road that had not been constructed.
For
reasons unrelated to the issue under consideration in this part of
the current appeal, the court in
Steinberg
found it unnecessary to decide whether constructive expropriation was
a cognisable concept in our law, but it did explain how the
statutory
scheme in respect of the proclamation of a public road worked under
the Roads Ordinance.  It held that ‘
although
the approval of the road scheme might affect the value of the
property, it was nothing more than advance notification of
a possible
intention to construct a road which, if implemented in the form
approved, would result in a taking.
It
was not in itself a taking
.
’
[20]
The demonstrable equivalence between the statutory schemes under the
two ordinances begs the question whether there is any
basis to
materially distinguish the effect of a road proclamation under the
Roads Ordinance from one under the preceding Divisional
Councils
Ordinance; particularly in circumstances where a declaration under
the Divisional Councils Ordinance is expressly deemed
to be have been
made under the Roads Ordinance.  I am not persuaded that the
defendants have shown that there is.
[45]
For all of the foregoing reasons, I
accordingly consider that there was no merit in the first and second
grounds of objection raised
by the defendants.  I should perhaps
record that I do not, with respect, agree in all respects with the
reasoning of the court
a quo in reaching the same conclusion.
[21]
However, as appeals are generally concerned with results of cases
rather the reasoning by which they were determined, all
that matters
is that we are satisfied that the exception based on the first and
second grounds of objection was correctly dismissed.
The
defendants’ cross-appeal will therefore be dismissed.
[46]
Turning then to the plaintiff’s
appeal against the upholding by the court a quo of the defendants’
exceptions to its
claims in terms of prayers (b) and (c).  I
shall treat first of the defendants’ third to fifth grounds of
objection,
which, it will be recalled, relate to the applicability of
regulation 38 of the LUPO regulations.
[47]
One is able to say at once that there is no
merit in the retrospectivity argument advanced by the defendants in
support of these
grounds of objection.  As the plaintiff’s
counsel correctly pointed out, the LUPO regulations, if they were
applicable,
came to bear because of events that occurred after the
enactment of LUPO.  The particulars of claim do not pretend to
suggest
that the regulations affected the consequences of the
Proclamation between the time it was made and the commencement of
LUPO on
1 July 1986.  The allegation is that the regulations
came to bear after the confirmation of the subdivisions of the
development
property and after the requisite minimum number of
saleable erven in the subdivisions had been sold.  LUPO was in
force at
the time.  The allegations do not bear on the existence
of the R300 pursuant to the 1973 Proclamation.  Instead, they

allege the imposition by the regulations,
post-1986
,
of an obligation on the road authority to
purchase
the land over which the road was declared once the conditions
prescribed in regulation 38 for the triggering of the obligation
had
been satisfied.
[22]
[48]
The question remains, however, whether
regulation 38 of the LUPO regulations was applicable in the factual
context alleged in the
particulars of claim.  The answer,
turning, as it does, on statutory interpretation, is a matter of
law.  In the circumstances,
the court a quo was entitled to
decide the question raised by the defendants’ third ground of
objection generically, rather
than being limited by the specific
bases upon which the defendants contended for the conclusion that the
regulation did not apply;
cf.
Paddock
Motors (Pty) Ltd v Igesund
1976 (3) SA
16
(A) at p.23 and
Minister of Minerals
and Energy v Agri South Africa
2012 (5)
SA 1
(SCA) in para 7.
[49]
The issue is whether subsidiary legislation
under LUPO was intended to, or competently could, derogate from the
provisions of the
Roads Ordinance and the Expropriation Act in
respect of the taking of land for road purposes.  Another
approach would be to
ask whether the declaration of a public road
before the subdivision was granted resulted in land in the
subdivision being ‘
required by any
other authority
’ within the
meaning of regulation 38.
[50]
The defendants’ counsel submitted,
correctly, that the ambit of the LUPO regulations was defined by the
empowering provision
in terms of which they were made.  Section
47(1) of LUPO provided in that regard as follows: ‘
Subject
to the provisions of sections 7(2) and 8
[which
are not relevant for present purposes]
,
the Administrator may make regulations relating to matters which
shall or may be prescribed by regulation in terms of this Ordinance

and, generally, relating to all matters which he deems necessary or
expedient to prescribe in order to achieve the purposes of
this
Ordinance
’.  Section 47(1)
plainly vested a discretionary power in the Administrator, but his
discretion was limited to regulation-making
in respect of matters he
might reasonably have regarded as necessary or expedient to achieve
the purposes of LUPO.  Any regulations
that he purported to make
while acting beyond the limits of his discretion would be ultra
vires.  The regulations should therefore
be construed as far as
possible to have a meaning compatible with the Administrator having
made them acting within his powers;
that is, in a way that would
uphold their validity (cf. e.g.
Port
Elizabeth Municipality v Uitenhage Municipality
1971 (1) SA 724
(A) at 738D-E).
[51]
The defendants argue that LUPO and the
Roads Ordinance are separate pieces of legislation treating of quite
discrete subject matter.
LUPO, they say, is concerned with the
regulation of town planning through the use of structure plans,
zoning schemes and the subdivision
of land, whereas the Roads
Ordinance is directed at matters of transport, including the
proclamation, construction and maintenance
of roads of various
classes and the acquisition of land and use of land for road purposes
and matters ancillary thereto.
[23]
[52]
The defendants’ argument enjoys some
support in the dichotomous characterisation of transport-related and
town planning legislation
by the Constitutional Court in
Reflect-All
1025 CC and Others v MEC for Public Transport, Roads and Works,
Gauteng Provincial Government and Another
[2009] ZACC 24
(27 August
2009); 2009 (6) SA 391
(CC) ;
2010 (1) BCLR
61
(CC), in which the minority judgment referred to the Gauteng
Transport Infrastructure Act 8 of 2001 (Gauteng), which replaced the

old Transvaal Roads Ordinance 22 of 1957, as ‘
road
planning
’ legislation.
[24]
The term was apparently used in contradistinction to ‘town
planning’.  Reference to the character of legislation

generally in this country supports a distinction of that sort for
regulatory purposes.  Physical planning measures, that is

matters directed at governing matters of land use and spatial
planning, are generally dealt with in discrete legislation from
matters of transport in general; and transport-related matters tend
in turn to be regulated by individual enactments that are discernibly

divisible into distinct categories such as road transport, aviation,
ports, merchant shipping and so on.  Infrastructural
planning
related to higher order roads is a subject dealt with in
transport-related legislation.  Thus, for example, the Roads

Ordinance co-existed with LUPO, and continues to do so with the
spatial planning legislation that has replaced LUPO.
[53]
Some degree of overlap is, however, only to
be expected between town planning and higher order infrastructural
planning because
townships do not exist in a vacuum, and matters like
higher-order roads and rail links are things that interlink towns and
assist
in their efficient functioning and prosperity.  The
general legislative and administrative framework does nonetheless
create
a clearly discernible delineation of responsibility between
local government level town planning (‘municipal planning’),

at which LUPO was directed, and areas of governmental responsibility
such as national and provincial roads, for example.
This
division of responsibilities is also reflected in the functional
areas of competence listed in Schedules 4 and 5 of the Constitution.
[54]
The only roads that were provided for in
terms of LUPO were ‘
public
streets
’.  The term ‘
public
streets
’ was defined in s 2
of the Ordinance with reference to land vested in a local authority
in terms of s 28 of the
Ordinance.  The text of s 28
is set out paragraph [21]
above.  The
R300, which was declared as a trunk road in terms of the Trunk Roads
Ordinance, and is therefore currently deemed
to have been declared as
such in terms of s 3(1)(a) of the Roads Ordinance, would not,
when constructed, vest in a local authority.
And it would not
be the responsibility of a local authority to take the land necessary
to enable the road to be constructed.
Nor is any local
authority the ‘road authority’ for the R300.
[25]
It is therefore not a ‘public street’ within the meaning
of LUPO.  Furthermore, the road’s existence
was not
determined by the decision of a subdivision application in terms of
LUPO.  That was established by a proclamation
made in terms of
Chapter X of the 1952 Divisional Councils Ordinance, and is now
regulated under the Roads Ordinance.  The
status
of the R300 as a road was also not determined by any zoning decision
or provision under LUPO; it was, and remains, regulated
under the
Roads Ordinance.
[55]
In my view, these considerations militate
decisively against the correctness of any construction of regulation
38 of the LUPO regulations
in any way that would contradict the
scheme or effect of the Roads Ordinance.  The scheme of the
Roads Ordinance is that the
road authority is not obliged to take the
land over which a public road has been declared, but that it may do
so at a time of its
choosing if and when a road needs to be
constructed there.  The provisions of the Roads Ordinance in
respect of the acquisition
of land for road purposes would be
irreconcilable with regulation 38 of the LUPO regulations if the
latter were construed as the
plaintiff would have it.
[56]
The plaintiff argues that LUPO regulation
38 is applicable because the R300 was reflected in the relevant
structure plans for the
area in which the R300 erven are situated,
and the relevant planning authorities had advised that they would not
approve any applications
for rezoning and subdivision for the
development of a township on the farms that did not make provision
for the R300.  The
argument is not persuasive.
[57]
Provision for the R300 follows from the
proclamation of the road (which, as discussed, is deemed to have
occurred under the Roads
Ordinance),
not
from any of the structure plans
referred to in the plaintiff’s particulars of claim.  The
R300 might not exist in a physical
form over the ‘development
property’, but it exists as legal concept, and by its existence
as such impacted on the
use rights of the owner of the property with
effect from the date of the Proclamation.  No decision under
LUPO could competently
purport to alter those established incidents
of the proclamation of the road under a different law, for the
Ordinance itself contained
no provision permitting that.
[58]
The general purpose of a structure plan
compiled in terms of s 4 of LUPO was ‘
to
lay down guidelines for the future spatial development of the area to
which it relates (including urban renewal, urban design
or the
preparation of development plans) in such a way as will most
effectively promote the order of the area as well as the general

welfare of the community concerned
’;
see s 5 of LUPO.  Any structure plan that purported to
ignore the reality of a proclaimed road (even one yet
to be
constructed) therefore could not hope to fulfil the purpose for which
it was prepared, and it would have been irrational
for the
Administrator to purport to approve it.  Similar considerations
would apply in respect of an urban structure plan
drafted under the
Physical Planning Act 125 of 1991, a guide plan in terms of the
Physical Planning Act 88 of 1967, or a transport
plan prepared under
the Urban Transport Act 77 of 1978.
[59]
The advice allegedly given to the
University and Arun that any decision in respect of the rezoning or
subdivision of Farms 311/57
and 311/61 would have to take account of
the existence of the R300 was merely in confirmation of the existence
of a relevant state
of affairs
dehors
the provisions of LUPO and any application for rezoning and
subdivision that the landowner might choose to submit under that
Ordinance.
The reality of the already existing road, albeit
only in conceptual form, did not constitute a requirement imposed in
terms, or
arising out, of LUPO.  The fact that the R300 was
reflected in a structure plan approved in terms of s 4 of LUPO
was
also, for the reasons explained in the preceding paragraph, just
incidental.  The restricting effect of the R300 on the
landowner’s
ability to use the land did not arise from any
provision of LUPO or from the determination of any application made
thereunder;
it arose rather from the declaration of the road in terms
of the 1952 Divisional Councils Ordinance and the subsequent
incidence
of the Roads Ordinance.  This conclusion is supported
by the fact that the R300’s status as a proclaimed road would
not be affected in any way were the rezoning and subdivision
approvals granted under LUPO to lapse for any reason.  It would

also not be affected by the lapsing of the (time-limited) applicable
structure plan.  These features serve to illustrate that
the
existence of the road was entirely unrelated to the operation of
LUPO.
[60]
It is of little surprise in the
circumstances that the R300 erven were not included in the three
phases of development provided
for in the series of rezoning and
subdivision approvals alleged in the particulars of claim.  As
noted above,
[26]
the R300 erven were the subject matter of a separate subdivision.
They represented the parcels of land that would remain
in the
ownership of the development property after the confirmation of the
subdivision of the three constituent phases of the development
and
the transfer to, or vesting in, third parties of all of the
development property.  They represented residual land outside
of
those parts of the two farms that were subdivided for township
purposes.  The local authority was obliged in terms of Chapter

II of LUPO to accord the residual land recognition as separate land
units.  That would also be necessary for land survey
[27]
and deeds registry purposes.
[28]
It is also only because of an external factor – the
existence of De Villiers Road, which presumably vests in the local

authority – that there are two R300 erven instead of just one
erf.  The R300 erven were not land
within
the area subdivided for development and use for township purposes;
they were, in my judgment, therefore, on any approach, not ‘
land
in a subdivision
... required
by any other authority for a purpose
other than that referred to in regulation 37
’.
[29]
[61]
Even if I were wrong in holding that the
R300 erven were not in the subdivisions approved under LUPO, the
wording of regulation
38, especially by its employment of the word
‘
purchase
’
and its prescriptions of how the price is to be determined and any
dispute thereanent
resolved, is
irreconcilably inconsistent with the scheme for the taking of land
for road purposes in terms of Chapter III of the
Roads Ordinance read
with s 26 of the Expropriation Act (in either its original or
current form).  It would not have
been within the competence of
Administrator to make subsidiary legislation under LUPO that had the
effect of contradicting, amending
or overriding the provisions of
superordinate legislation such as applicable Acts of Parliament or
provincial ordinances.
The Administrator must be taken to have
been aware of the relevant provisions of the Roads Ordinance and the
Expropriation Act
when he made the LUPO regulations.  In the
circumstances it must be presumed that he could not have intended
that regulation
38 should have the import contended for by the
plaintiff.
[62]
In my judgment, the use of the word
‘purchase’ and the means provided in regulation 38
for the determination of
the purchase consideration in the event of a
dispute about the price indicate that the ‘requirement’
by any other state
authority contemplated in the regulation is one
asserted by such other authority when the application for subdivision
is advertised.
It would also have to be of a character
different to that which would attend an expropriation of the land
concerned because the
financial consequences of the expropriation of
land are regulated in a completely different manner to the
determination of a purchase
consideration as contemplated by
regulation 38.
[63]
Counsel did not refer us to any examples in
which regulation 38 has been applied in practice.  I have
struggled to conceive
of circumstances in which the regulation would
apply when it is always open to an organ of state, at a time of its
own choosing,
to expropriate any land that it requires for its
legitimate purposes.  It seems to me that the regulation is only
likely to
apply when the requirement by a state authority for a
particular piece of land in a subdivision has been made known during
the
administrative processing of a subdivision application, and has
consequently been incorporated as a condition of approval.
[64]
That type of situation postulates the
imposition of the condition as the
fons
et origo
of the obligation on the
developer to submit to the requirement.  It is a situation quite
distinct from that obtaining in
the current case, where the basis for
the road authority’s entitlement to keep the land reserved for
its purposes, namely
the Proclamation, is unrelated to the
applications for the rezoning and subdivision of the land.  A
state authority that engages
in a subdivision application in the
manner that I have postulated would thereby become a party to the
application process, cognisant,
and accepting, of the implications of
regulation 38.  Something akin to consensus would be
involved between the planning
authority imposing such a condition,
the state authority requesting it and the developer accepting it.
[65]
Certainly, at the time the LUPO regulations
were made, in December 1988, the notion
that
an element of consensus was involved in township development pursuant
to the conditional approval of land development applications
enjoyed
authoritative support; cf.
Administrator
Cape Province v Ruyterplaats Estates (Pty) Ltd
1952 (1) SA 541
(A) at 550H-551F, referred to in
City
of Cape Town v Helderberg Park Development (Pty) Ltd
[2008] ZASCA 79 (2 June
[2008] ZASCA 79
;
2008); 2008 (6) SA 12
(SCA);
[2008] 4
All SA 297
(SCA), in para 4.  The attribution of something
akin to a consensual aspect to the ‘requirement’ would
afford
a sensible basis for the acquisition contemplated by the
regulation being in the nature of a
purchase
,
instead of an
expropriation
.
[66]
It is evident that if regulation 38 were
applicable in the circumstances set out in the particulars of claim
it would materially
subvert the rationale or scheme of the Roads
Ordinance, which allows for long-term road planning by way of the
identification of
road routes long before the construction of the
roads is actually required, and allows the road authority to defer
having to acquire
the affected land until transport needs impel that,
and adequate funding is available to carry out the contemplated
scheme.
Those incidents of the Roads Ordinance were
acknowledged in
Steinberg
supra, at para 11, and, in respect of comparable provincial
legislation in Gauteng, also in
Reflect-All
supra, at para 67.  They were aspects of the roads
legislation that were expressly regarded as operating for the public

good.  In
Steinberg
,
the court held that if the road authority were obliged to take land
for declared roads and pay for it other than at a time of
the road
authority’s choosing ‘
forward
planning and good government would become economically impossible
’.
[67]
The application of regulation 38 in the
circumstances alleged in the particulars of claim would defeat the
intentions of the Roads
Ordinance, for it would require the roads
authority to take the land over which the route of the proclaimed
land had been declared
not when it considered it right and opportune
to do so, but instead at a time fixed by the progress of a private
property development
on adjacent land, and irrespective of any
connection between the need for the construction of the road at that
time and the needs
arising from the development.  The adverse
implications of any such application of the regulation on the scheme
devised in
the Roads Ordinance are obvious and significant.
[68]
I have demonstrated how the regulation is
capable of being interpreted in a manner that would not bring it in
conflict with other
higher order legislation.  Such an
interpretation is to be preferred in principle to the one contended
for by the plaintiff,
which would have the opposite effect.  My
conclusions on this matter lead me to uphold the defendants’
contention that
regulation 38 is not applicable on the pleaded facts.
[69]
But even if my conclusions were
misconceived, the appeal against the decision by the
court
a quo to uphold the exception to the plaintiff’s claim in
prayer (b) of the summons should nevertheless still be dismissed
by
reason of the plaintiff’s failure to adequately allege that the
road authority ‘required’ the R300 erven.
Reference
to the Roads Ordinance shows that the prescribed manner for a road
authority to signify its requirement of any land for
road purposes is
to serve or cause to be served a notice of expropriation in
accordance with s 29 of the Ordinance.
For the reasons
discussed earlier in this judgment, the mere designation of any land
as a declared public road does not amount
to a requirement that the
land be taken for such purpose, it indicates only that the land may
possibly, not necessarily, be needed,
dependent on a decision yet to
be made.
[70]
Regulation 38 is directed at land that is
actually required by an authority.  Why else oblige the
authority to purchase it?
Construing the regulation to oblige a
road authority to purchase land for a road that it has no current
intention to construct
and may never build would result in
absurdity.  Prudent fiscal management would be undermined to the
obvious detriment of
the public interest.
[30]
The plaintiff has not alleged that it has been served with a notice
in terms of s 29 of the Roads Ordinance.  It
has therefore
not made out a case that either it or the local authority could
consider the land to be ‘required’ by
the defendants
within the meaning of regulation 38.
[71]
In view of the conclusions reached on the
third and fourth grounds of exception, which are by themselves
determinative, it is not
necessary to decide the fifth ground of
objection.  Suffice it to say that there would be no merit in
any contention that
s 26 of the Expropriation Act would not
apply in respect of the computation of the compensation payable by
the road authority
for the taking or expropriation of the R300 in
terms of Chapter III of the Roads Ordinance.  As discussed
earlier in this
judgment, however, regulation 38 is not concerned
with that and contains its own provisions concerning the
determination of the
monetary consideration that an authority which
purchases property in terms of the regulation has to pay.
Notably, such consideration
does not include any provision for an
amount to make good any financial loss incurred by the landowner by
reason of the state authority’s
requirement of the land (as in
s 12(1)(a)(ii) of the Expropriation Act) or a solatium (as in
s 12(2) of the Expropriation
Act).
[72]
For all of the foregoing reasons, the
appeal against the judgment of the court a quo upholding the
exception to the claim in terms
of prayer (b) of the summons will be
dismissed.
[73]
Lastly, it is time to consider the appeal
against the upholding by the court a quo of the exception to the
alternative claim, in
prayer (c), for payment of an amount in
compensation for the so-called ‘constructive expropriation’
of the R300 erven.
[74]
In
Harksen v
Lane NO and Others
[1997] ZACC 12
;
1998 (1) SA 300
(CC)
at para 32-34, the
Constitutional Court, in
the context of the property clause in s 28 of the Interim
Constitution, made the following observations
concerning the
distinction between expropriation and deprivation:
[32] The word 'expropriate' is
generally used in our law to describe the process whereby a public
authority takes property (usually
immovable) for a public purpose and
usually against payment of compensation.  Whilst expropriation
constitutes a form of deprivation
of property, s 28 makes a
distinction between
deprivation
of rights in property, on the
one hand (ss (2)), and
expropriation
of rights in property, on
the other (ss (3)). Section 28(2) states that no deprivation of
rights in property is permitted otherwise
than in accordance with a
law.  Section 28(3) sets out further requirements which need to
be met for expropriation, namely
that the expropriation must be for a
public purpose and against payment of compensation.
[33] The distinction between
expropriation
(or compulsory acquisition as it is called in
some other foreign jurisdictions) which involves acquisition of
rights in property
by a public authority for a public purpose and the
deprivation
of rights in property which fall short of
compulsory acquisition has long been recognised in our law. In
Beckenstrater v Sand River Irrigation Board
,  Trollip J
said:
'(T)he
ordinary meaning of ''expropriate'' is ''to dispossess of ownership,
to deprive of property'' (see eg
Minister
of Defence v Commercial Properties Ltd and Others
1955 (3) SA 324
(N) at  B 327G); but in statutory provisions,
like secs 60 and 94 of the Water Act, it is generally used in a wider
sense
as meaning not only dispossession or deprivation but also
appropriation by the expropriator of the particular right, and
abatement
or extinction, as the case may be, of any other existing
right held by another which is inconsistent with the appropriated
right.
That is the effect of cases like
Stellenbosch
Divisional Council v Shapiro
1953
(3) SA 418
(C) at 422--3, 424;
SAR
& H v Registrar of Deeds
1919 NPD 66
;
Kent
NO v SAR & H
1946
AD 398
at 405--6; and
Minister
van Waterwese v Mostert and Others
1964 (2) SA 656
(A) at 666--7.'
[34] The Zimbabwean Constitution
also provides that property may not be compulsorily acquired, save
under a law which requires the
acquiring authority to pay fair
compensation.  In
Hewlett v Minister of Finance and Another
,
Fieldsend CJ considered the meaning of 'acquire' in those
sections of the Constitution. He referred to the following dictum
of
Innes CJ in
Transvaal Investment Co Ltd v Springs Municipality
:
'.
. . juristically, the word ''acquire'' connotes ownership; the
ordinary legal meaning implies the acquisition of dominium. To

acquire a thing is to become the owner of it. No doubt it may be used
in a wider sense so as to include the acquisition of a right
to
obtain the dominium; but the narrower meaning is the accurate and
more obvious one.'
Fieldsend CJ continued:
'It
is true, too, that “compulsory acquisition” is used in
both English and Roman-Dutch law to denote the expropriation
of
property by an authority - whether State, local or public utility -
usually for some public purpose, most commonly in relation
to land.
It is, of course, common cause that property in s 16 is not limited
to land.
Cases
relied upon by Mr Kentridge clearly establish that it is not every
deprivation of a right which amounts to a compulsory acquisition
of
property, as for example regulation of a landlord's rights which in
effect diminished his rights (
Thakur
Jagannatha Baksa Singh v United Provinces
1946 AC 327
(PC)), regulations which limited an owner's right to
build above a certain height on his land (
Belfast
Corporation
v
OD Cars Ltd
[1960] AC 490)
, and legislation allowing licensed pilots to provide
pilotage only if they were employed by the port authority (
Government
of Malaysia v Selangor Pilot Association
(supra)).
It
is perhaps of some significance to note that in almost all the
post-colonial constitutions granted by Britain in Africa the section

reciting the fundamental freedoms protected refer to the right not to
be deprived of property without compensation whereas the
sections
giving actual protection provide that no property of any description
shall be compulsorily taken possession of and no
interest in or right
[over] property of any description shall be compulsorily acquired
except on certain conditions including compensation.
This is clear
recognition that   there is a distinction between
deprivation and acquisition, and also an indication that
not every
deprivation of property must carry compensation with it. Indeed
government could be made virtually impossible if every
deprivation of
property required compensation.'
In
Davies
and Others v Minister of Lands, Agriculture and Water Development
,
Gubbay CJ cited the aforesaid passages with approval and held that s
11(c) of the Zimbabwe Constitution does not afford protection
against
deprivation of property by the State ‘where the act of
deprivation falls short of compulsory acquisition or
expropriation’.
[31]
The distinction between deprivation and expropriation in s 28 of
the Interim Constitution is equally apparent in s 25
of the 1996
Constitution.
[75]
In
Steinberg
supra, at para 4, Cloete AJA, with reference to aforementioned
passage in
Harksen
,
observed that a ‘
fundamental
distinction is drawn in section 25 between two kinds of taking: a
deprivation and an expropriation.
It is only in the case of an
expropriation that there is a constitutional requirement for
compensation to be paid. The purpose of
the distinction is to enable
the State to regulate the use of property for the public good,
without the fear of incurring liability
to owners of rights affected
in the course of such regulation
’.
[32]
The learned judge proceeded, in para 6, to say ‘
The
principle of constructive expropriation creates a middle ground, and
blurs the
distinction, between
deprivation and expropriation. According to that principle a
deprivation will in certain circumstances attract
an obligation to
pay compensation even although no right vests in the body effecting
the deprivation. It is the determination of
those circumstances which
can give rise to problems
.’
In para 7, Cloete AJA recorded that counsel for the appellant in that
case (which it will be recalled concerned a
claim based on an alleged
constructive expropriation) had urged the Supreme Court of Appeal to
have regard to the United States
jurisprudence on the issue.  He
noted, however, that the US Supreme Court had, in
Penn
Central Transportation Co et al v New York City et al
[1978] USSC 180
,
438 US 104
123-4 (1978), acknowledged that ‘
While
this Court has recognised that the “Fifth Amendment’s
guarantee ...[is] designed to bar Government from forcing
some people
alone to bear public burdens which, in all fairness and justice,
should be borne by the public as a whole,”
Armstrong
v United States
,
364 U.S. 40
, 49
(1960), this Court, quite simply, has been unable to develop any “set
formula” for determining when “justice
and fairness”
require that economic injuries caused by public action be compensated
by the government, rather than remain
disproportionately concentrated
on a few persons.
’  Cloete
AJA pointed out that that passage in
Penn
Central
had been reiterated in three
subsequent US Supreme Court decisions.
[33]
[76]
The SCA allowed in
Steinberg
that there may be scope for ‘
the
development of a doctrine akin to constructive expropriation in South
Africa
’, but acknowledged that
any such development might be beset by difficulties of a
constitutional policy character.  The
court found it unnecessary
to go further than that because it concluded that ‘(t)
he
fallacy in the argument advanced on behalf of the appellant is that
it postulates that advance notification by a public authority
of a
possible or even probable intention to embark on a course of conduct
which, if ultimately persisted in, must necessarily result
in a
taking, is to be equated to an expropriation. If this were the law a
public authority such as the respondent
[a road authority under the Roads Ordinance]
would
be obliged to acquire and compensate the owners of all rights which
might be affected by a proposed
undertaking in the public interest, in
advance of a final decision as to the extent of the undertaking or
even whether it will be
implemented at all. The consequence would be
that forward planning and good government would become economically
impossible
.’
[77]
The judgment in
Steinberg
stands as authority for the proposition that the declaration of the
R300 did not result in a taking of the affected land in the
sense of
an expropriation within the meaning of s 25 of the
Constitution.  That conclusion is, of course, consistent
with
the determination earlier in this judgment in relation to the
exception to the claim in prayer (a) of the summons that
the
plaintiff remains the owner of the R300 erven.
[78]
The court in
Steinberg
found that a consideration whether the
proclamation of a road in
terms of the
Roads Ordinance, 1976, constituted constructive expropriation did not
arise because, as the court pointed out with
reference to s 17(1)
of the Roads Ordinance, the claimant could, notwithstanding the
proclamation, use her land as she wanted
to if she sought and
obtained permission from the road authority.
[34]
Section 17(1) was, of course, equally available to the plaintiff in
the circumstances of the current case.  Moreover,
in my opinion,
there was also nothing to prevent the plaintiff, if it felt that its
position was being irrationally or arbitrarily
prejudiced by the
longstanding and possibly interminable sterilising effect of the road
declaration to apply to the Premier for
the deproclamation of the
R300 route over the R300 erven.
[35]
The Premier is empowered by s 3(2) of the Roads Ordinance to
withdraw the proclamation of a road.  The provision
does not
expressly provide for an affected landowner to apply to the Premier
to exercise the power invested in him by that provision,
but that any
interested party may seek to prevail on the Premier to do so is
implicit.  The interest of landowners affected
by the route of
any such road in the withdrawal of a road proclamation is
acknowledged in s 3(3), and I see no reason therefore
why such a
landowner could not seek to prevail on the Premier to withdraw the
proclamation if the landowner were able to show that
there were good
reason to do so.
[79]
It is the fact that such remedies are
available, not the positive or negative result of a resort to them,
that determines whether
the regulatory interference with ownership
amounts to an effective taking.  This is so because the question
is whether the
regulation in issue – in this case the
Proclamation and the legislation that enabled its making and
determines its regulatory
consequences – constitutes an
effective taking, not whether an ameliorating provision in terms of
the regulatory legislation
is successfully or unsuccessfully availed
of by the affected owner.  That much is borne out, in my view,
by the majority judgment
in
Reflect-All
supra.
[80]
The proceedings in
Reflect
All
were concerned, insofar as relevant
for the purposes of the current matter, with a challenge to the
constitutionality of sub-secs
10(1) and (3) of the Gauteng Transport
Infrastructure Act.  The challenge was advanced on the grounds
that the impugned provisions
resulted in the arbitrary deprivation of
property, and were consequently incompatible with s 25(1) of the
property clause
in the Bill of Rights.  A secondary question was
whether the provisions effectively conduced to the expropriation of
land
without compensation, in conflict with s 25(2) of the
Constitution.  The litigation in
Reflect-All
did not concern a claim for compensation for constructive
expropriation.  It was therefore not necessary for the
Constitutional
Court to determine whether constructive expropriation
is a cognisable concept under the Constitution.  However, the
idea that
it might be was regarded with scepticism in the majority
judgment in the obiter remarks at para 65.
[36]
[81]
The majority judgment in
Reflect-All
did, however, contain some statements of general principle that are
germane to the issue of whether the deprivation in issue in
the
current case could be considered tantamount to expropriation, a
question that goes to the heart of the concept of ‘constructive

expropriation’.  Thus in paragraph 32, Nkabinde J wrote
‘
The protection of the right to
property is a fundamental human right, ... (h)owever, property rights
in our new constitutional democracy
are far from absolute; they are
determined and afforded by law and can be limited to facilitate the
achievement of important social
purposes. Whilst the exploitation of
property remains an important incident of landownership, the state
may regulate the use of
private property in order to protect public
welfare, e.g. planning and zoning regulation but such regulation must
not amount to
arbitrary deprivation. The idea is not to protect
private property from all state interference but to safeguard it from
illegitimate
and unfair state interference
’.
[37]
Similar observations about the import of the property clause have
been made in other judgments of the Constitutional Court;
see e.g.,
First National Bank of SA Ltd t/a Wesbank v
Commissioner, South African Revenue Service and Another; First
National Bank of SA Ltd
t/a Wesbank v Minister of Finance
[2002] ZACC 5
;
2002 (4) SA 768
(CC); 2002 (7) BCLR (CC) at para
48-52; and
Mkontwana v Nelson Mandela
Metropolitan Municipality
[2004] ZACC 9
(6 October
[2004] ZACC 9
;
2004); 2005 (1) SA 530
(CC);
2005 (2) BCLR 150
(CC), at
para 81-82.  In
First National Bank
supra, at para 52, it was remarked
‘
That property should also serve
the public good is an idea by no means foreign to pre-constitutional
property concepts
’.
[82]
In the current matter it is not contended
by the plaintiff that the applicable regulatory legislation was
arbitrary.  The contention
is that its effect crossed the
boundary between ‘deprivation’ and ‘expropriation’
within the scope of s 25.
In that regard, the majority in
Reflect-All
held ‘
courts should be cautious
not to extend the meaning of expropriation to situations where the
deprivation does not have the effect
of the property being acquired
by the state
’.
[38]
[83]
In
Agri South
Africa v Minister for Minerals and Energy
[2013] ZACC 9
(18 April
2013); 2013 (4) SA 1
(CC);
2013 (7) BCLR 727
(CC), in para 59, the Constitutional Court referred to that remark
and added ‘
There can be no
expropriation in circumstances where deprivation does not result in
property being acquired by the state
’.
The effect of the latter observation was to confirm that an
‘effective taking’ or ‘constructive
expropriation’
cannot occur unless the state thereby acquires property, which may be
corporeal or incorporeal.
[84]
The plaintiff’s counsel argued that
the material distinguishing feature between
Reflect-All
and the current case was that the Gauteng Transport Infrastructure
Act contains provisions that permit application to be made for
a
determined road route to be altered to enable the affected
landowner
to escape the sterilising consequences of a route determination if
that would be fair and feasible in the peculiar circumstances,

whereas, so it was contended, there is no such opportunity afforded
in terms of the legislation pertaining to the declaration of
the
R300.  The significance of that aspect of the Gauteng
legislation did indeed play a material role in saving the impugned

provisions from constitutional incompatibility on the grounds of
arbitrariness.  The point asserted in the majority judgment
in
Reflect All
was that the sterilisation of the use of the land by the route
determination was only relative, not absolute, because the landowner

could apply for a route variation.  The extent of the
deprivation occasioned by the legislation therefore fell short of
that
which could be regarded as expropriation.  For the reasons
mentioned above, I consider that the same considerations apply in

respect of the Roads Ordinance.
[85]
In my view, the judgment in
Agri
SA
(CC) supra, appears to recognise the
concept of constructive expropriation for the purposes of s 25
of the Constitution, in
that it appears to acknowledge that regard
must be had to substance rather than form in deciding whether a
particular deprivation
amounts to expropriation.
Agri
SA
(CC) recognises that there will be
cases where there is no bright line between a deprivation amounting
to an effective expropriation
and one falling short of that.
[39]
The judgment indicates that is an issue that necessarily will fall to
be decided on a case-by-case basis; although the Court
did hold that
difficulty in drawing the distinction is much more likely to arise in
the context of a deprivation of incorporeal
property than where
corporeal property is involved.
[40]
[86]
The plaintiff’s counsel relied on the
potential difficulty in being able to draw the distinction between
deprivation and expropriation
to contend that the defendants’
objection to the claim in prayer (c) was not properly susceptible to
decision on exception,
involving, so they contended, questions more
appropriately decided in a trial.  I was initially attracted by
that argument,
but I have concluded on reflection that it too glibly
evades the point of the exception, which is that no cognisable claim
has
been made out in the particulars of claim.  If that is the
case, then it would be wrong to send the claim to trial on the basis

that something (even if one does not know quite what) might emerge
there to give it some foundation.
[87]
For there to be an expropriation, there has
to be an acquisition by the state of something equivalent to the core
essence of the
expropriatee’s property, whether it be corporeal
or incorporeal.
[41]
Where the property is corporeal, that will ordinarily be evinced by a
taking of the thing itself; in the current case, the
land
constituting the R300 erven.  Indeed, the plaintiff’s case
is that it is the land that has been constructively
taken.  The
allegation is that ‘the effective taking’ of the R300
erven was done by a public authority acting
in terms of the
Divisional Councils Ordinance of 1952
and/or
the Trunk Roads Ordinance of 1960 and/or LUPO.
[88]
The allegation of an effective taking
having occurred in terms of 1952 Divisional Councils Ordinance or the
Trunks Roads Ordinance
can only refer to the effect of the 1973
Proclamation.  The defendants’ contention in their
exception to the claim in
prayer (c) that a taking in the
pre-Constitutional era is not amenable to the protection of property
rights afforded in terms of
s 25 of the Constitution is well
made; cf.
Du Plessis and Others v De
Klerk and Another
[1996] ZACC 10
;
1996 (3) SA 850
(CC);
1996 (5) BCLR 658
(CC) at para 13-20,
Key
v Attorney-General, Cape Provincial Division and Another
[1996] ZACC 25
;
1996 (4) SA 187
(CC) at para 6 and Woolman
et
al
(eds),
Constitutional
Law of South Africa
2 ed.
(Jutastat e-publications) at 31.8, s.v. ‘Retrospectivity’.
[89]
It is also clear from the provisions of the
Ordinances discussed above, that the effect of the Proclamation was
in any event a deprivation,
not an acquisition by the state of
ownership of the affected property.  It also did not deprive the
owner of all of its rights
to use the land.  It also did not
result in the acquisition by the road authority of any rights in the
land that had previously
vested in the owner.  That Arun
subsequently chose to use the land in such a way as to render that
part of it that is now
constituted by the R300 erven of no practical
use to it, was of its doing, not that of the state.  It no doubt
did so in order
to extract the maximum economic potential of the land
even with the encumbrance of a declared trunk road running through
it.
In any event, if the Proclamation was the allegedly
expropriating act, it was not the plaintiff but the University of
Stellenbosch
that would have been the property-owning victim of the
expropriation.  Once the University’s property or any
rights
it had therein had been ‘effectively expropriated’,
it would not have been in a position to pass on to its successors
in
title any greater rights in the land than it had been left with after
such effective expropriation.
[90]
The plaintiff sought in its particulars of
claim to qualify itself, as the successor to Arun, as the rightful
claimant for compensation
by alleging that the effective taking was
manifested by the
combined
effect of the Proclamation and the rezoning and subdivision
applications.  In my judgment it is clear, however, that the
decisions made in terms of LUPO did not in any manner affect the
status of the R300 erven beyond what had already been done by way
of
the 1973 Proclamation.  At most, the alleged indication by the
provincial administration that any subdivision of the farms
could not
impinge on the declared status of the R300 erven as part of a planned
trunk road might in the given context have resulted
in an arbitrary
deprivation of the land if there were no realistic prospect at the
time of it being needed for the declared purpose.
There is,
however, no allegation in the particulars of claim to that effect;
and even if there had been I am not certain that a
claim for
compensation for so-called ‘constructive expropriation’
of the land would have been the
appropriate
remedy.  I have difficulty with the notion that Arun could in
the circumstances have accepted the town planning
conditions imposed
under LUPO with reference to the declared status of the R300 erven
and then claimed compensation for the consequences
of having done so.
[91]
If the R300 erven are indeed not marketable
or amenable to development, as alleged in the particulars of claim,
it is nevertheless
evident from the factual context alleged in the
pleading that that is so not because of the proclamation of the R300,
but because
of the manner in which the plaintiff and its predecessors
in title have chosen to use the land units of which the R300 land
formed
a small part at the time the road was declared.  If they
had left it as farmland, as it was in 1973, there is nothing to
suggest
that, pending the taking of the R300 land to construct a
road, the owners could not use the property for that purpose.
Just
as the plaintiff seeks to have the value of the R300 erven
assessed with reference to the value of the original ‘development

property’ of which it formed part considered as a whole, so too
would the question of whether there has been an effective
taking of
the land fall to be assessed with reference to the extent of the
regulatory effect of the proclamation of the road on
the land units
as they were at the time the Proclamation was made.  If it
appears on such an assessment, as indeed appears
to be the case on
the facts alleged in the particulars of claim, that the ability of
the owner to use, develop or market the land
was impacted by the
Proclamation only to a relative degree with regard to the extent of
the land as a whole, the notion that the
regulation constituted a
deprivation going so far as to amount to a constructive expropriation
becomes untenable.
[92]
To sum up on the third exception, the state
has not acquired anything from the landowner by virtue of the
Proclamation or the LUPO
decisions.  Neither of those decisions
could therefore be characterised as constituting an acquisition of
the land by the
state.  For the reasons stated above I therefore
do not consider that a constructive expropriation has been
established on
the basis of the pleaded facts.  But if I am
wrong, and also for the reasons discussed above, the relevant taking
could have
occurred only by way of the 1973 Proclamation.  The
subsequent LUPO decisions, which acknowledged the existence of the
declared
road did not entail a taking or further taking.  In the
circumstances, the pleaded facts do not bring the case within the
ambit of s 25 of the Constitution, which does not apply to
expropriations effected before the Constitution came into operation.
[93]
The appeal against the decision of the
court a quo to uphold the exception to the claim advanced in prayer
(c) of the summons will
accordingly also be dismissed.
[94]
It seems to me that as both the appellant
and the cross-appellants were unsuccessful, it would be just that
each party bear its
own costs in the proceedings before the full
court, such costs
to include the costs of
the applications to the court a quo for leave to appeal and
cross-appeal, respectively.  It goes almost
without saying that
the suspension of the order made in terms of paragraph 3 of the order
of the court a quo will cease to be of
effect from the date of the
dismissal of the appeal and cross-appeal by this court.
[95]
The following order is made:
1.
The appeal against the dismissal by the
court a quo of the exceptions to the claims advanced in prayers (b)
and (c) of the plaintiff’s
particulars of claim, as amended, is
dismissed.
2.
The cross-appeal against the dismissal by
the court a quo of the exception to the claim advanced in prayer (a)
of the plaintiff’s
particulars of claim is dismissed.
3.
Each party shall bear its own costs in the
appeal and cross-appeal, including the costs of the respective
applications to the court
a quo for leave to appeal and cross-appeal.
A.G.
BINNS-WARD
Judge of the
High Court
M.I. SAMELA
Judge of the
High Court
T.D. PAPIER
Judge of the
High Court
APPEARANCES
Appellant’s
counsel:

S.P. Rosenberg SC
K. Reynolds
Appellant’s
attorneys:

Du Plessis Hofmeyr Malan
Somerset West
Respondents’
counsel:

Karrisha Pillay SC
U.K. Naidoo
Respondents’
attorneys:

The State Attorney
Cape Town
[1]
Section 120 provided as follows insofar as
relevant:
‘
(1)
Subject to the provisions of section 121, the Administrator may by
proclamation-
a) ..
c) on application by the council concerned, declare a main road
along a line where no declared road, trunk road or public road
exists;
...’
‘
(4)
The Administrator may after consultation with the council concerned.
by proclamation -
(a)
subject to the provisions of
section l27(2)(a), declare a main road along a line where no
declared road, trunk road, public road
or public street exists;
(b)
...
’
Section 121
required prior notice to given of an intention to make a declaration
in terms of s 121, and afforded the opportunity
for interested
parties to submit objections to the proposal.
[2]
Section 1A provided that the Administrator could,
by proclamation, declare a main road or portion thereof to be a
trunk road.
[3]
The italicised words were specially defined in
the respective Ordinances.
[4]
Section 127(2)(a) provided: ‘
Notwithstanding
the provisions of sub-section (1), the Administrator – (a)
shall construct any main road declared under
section 120 (4)(a); and
(b) ...
’.  The wording of
s 120(4)(a) is quoted in note 1 above.  The Proclamation makes
no reference to an application
by the affected divisional councils,
and it would therefore appear that insofar as relevant the
declaration of the R300 as a
main road was made in terms of
s 120(4)(a), rather than s 120(1)(c).
[5]
Section 3 provided as follows insofar as
relevant:
‘
Construction
of trunk roads and maintenance of certain trunk roads transferred to
Administrator
Notwithstanding
the provisions of any other ordinance, from the fixed date -
(a)
the council shall be relieved of
its powers, rights and duties in respect of the construction and
reconstruction of trunk roads
and the maintenance of permanently
surfaced trunk roads;
(b)
the council's powers and rights in
respect of the construction and reconstruction of trunk roads and
the council's powers, rights
and duties in respect of the
maintenance of permanently surfaced trunk roads shall be conferred
and imposed on the Administrator;
(c)
..., and
(d)
... .’
[6]
See note 1 above.
[7]
Section 22(1)(a) of LUPO provided: ‘
No
application for subdivision involving a change of
zoning
shall be considered in terms of this Chapter, unless and until the
land concerned has been zoned in a manner permitting
of subdivision,
in terms of Chapter II.
’
[8]
‘
Access and roads:
The
planning of access and roads must be coordinated with the local
authority, and where provision is made for access from an
adjoining
local authority area or proclaimed main road, proof of the required
engagement with such entity must be lodged together
with the
finalised plans.
’
(My
translation.)
[9]
‘
Structure plan proposals
The
overall planning, subdivision and development of the property is
further subject to the general provisions of the approved
structure
plan applicable to the property... .
’
(My
translation.)
[10]
On or about 5 November 1999, see paragraph [6]
above.
[11]
Section 27 of LUPO provides:
‘
Confirmation
of subdivision.
1) If a
Surveyor-General has approved a general plan or diagram as
contemplated by section 26, the owner concerned shall, within
a
period of five years after the application has been granted under
section 25 or within such longer period as the Administrator
or the
council concerned, as the case may be, may determine, furnish the
registrar of deeds concerned with such documents and
information as
he may require, comply with the requirements of the said registrar
in connection with the cancellation of existing
conditions of title,
provide services in accordance with a condition imposed under
section 42 (1) in respect of the subdivision
and obtain the
registration of at least one land unit.
(2) Where
an owner has failed to comply with the provisions of subsection (1)
in relation to a subdivision or a part thereof,
the granting of the
application under section 25 shall be deemed to have lapsed in
relation to the said subdivision or part thereof
at the expiry of
the period contemplated by subsection (1), and the diagram or
general plan concerned shall be amended in accordance
with the
requirements of the Surveyor-General.
(3)
As soon as the provisions of subsection (1) have in relation to a
subdivision or part thereof been complied with in such manner
that
the granting of the application concerned under section 25 cannot
lapse in terms of subsection (2) of this section, such
subdivision
or part thereof shall be deemed to be confirmed
.’
[12]
Section 27 of the Roads Ordinance.
[13]
Underlining provided for emphasis in the notice
of exception.
[14]
See paragraph [28]2
above.
[15]
Cf.
Chisuse and
Others v Director-General, Department of Home Affairs and Ano
ther
[2020] ZACC 20
(22 July
2020); 2020 (10) BCLR 1173
(CC);
2020
(6) SA 14
(CC) at para 46-59;
Cool
Ideas 1186 CC v Hubbard
[2014] ZACC 16
(5 June
2014); 2014 (4) SA 474
(CC);
2014 (8) BCLR 869
(CC) at para
28;
Bato Star Fishing (Pty) Ltd v
Minister of Environmental Affairs and Others
[2004] ZACC 15
(12 March
[2004] ZACC 15
;
2004); 2004 (7) BCLR 687
(CC);
2004 (4) SA
490
(CC) at para 90, and
Dadoo Ltd and
Others
v
Krugersdorp
Municipal Council
1920 AD 530
at 543.
[16]
See
Arun Property
Development (Pty) Ltd v City of Cape Town
[2014]
ZACC 37
(15 December
2014); 2015 (3) BCLR 243
(CC);
2015 (2) SA 584
(CC) at para 34, citing
Belinco (Pty)
Ltd v Bellville Municipality and Another
1970 (4) SA 589
(A) at 597C;
Administrator
Cape v Associated Buildings Ltd
1957
(2) SA 317
(A) at 325B-F and
South
Peninsula Municipality and Another v Malherbe NO and Others
1999 (2) SA 966
(C) at 983A-B.
[17]
The defined meaning of ‘declared
road’ in s 1 of the Divisional Councils Ordinance was
that ‘
assigned
thereto by section 1 of the National Roads Act, 1935 (Act No. 42 of
1935)
’.
Act 42 of 1935 was repealed by s 29 of the National Roads Act
54 of 1971, with effect from 1 October 1971.
The legislation
pertained to ‘
national
roads
’.
[18]
The pertinent provisions of s 146 of the 1952
Divisional Councils Ordinance have effectively been re-enacted in
s 17 of the
Roads Ordinance, 1976.
[19]
‘
Inner municipal area
’
was defined in s 119 of the Ordinance to mean ‘
that
portion of a municipality which has by actual survey been subdivided
into erven, lots or plots (excluding any area subdivided
into
agricultural erven, lots or plots any of which is 2, hectares or
more in extent) and the streets, roads, thoroughfares and
lanes
abutting thereon
’
.
[20]
In para 12.  (My underlining for emphasis.)
[21]
In particular, I do not agree that anything
turned on the nuances of the meaning of the word ‘
vest
’
in s 145, as the judgment of the court a quo appears to suggest.
‘
Vest
’
plainly has the meaning that both sides acknowledged that it does.
The question, rather, is when, on a proper construction
of the
legislation, did or does the vesting occur.
[22]
In their written submissions, the defendants’
counsel appear to indicate that the retrospectivity argument was
advanced
only ex hypothesi an acceptance of the defendants
contention that the 1973 Proclamation had an expropriating effect.
It
would indeed be only in such a context that the argument could
notionally be feasible.
[23]
See the definition of ‘
purposes
’
in s 2 of the Roads Ordinance; viz. ‘
in
relation to public roads and public paths includes any matter
ancillary to or connected with such roads or paths
’
.
[24]
In doing so, the judgment acknowledged that the
Infrastructure Act also dealt with rail transport.
[25]
See para (a) of the definition of ‘road
authority’ in s 2, and also s 66(1) of the Roads
Ordinance, 1976.
[26]
In paragraphs [6], [11]
and
[12].
[27]
Cf. s 26 of LUPO.
[28]
Section 43
of the
Deeds Registries Act 47 of
1937
.
[29]
My underlining for emphasis.
[30]
Cf.
Reflect-All
supra, in para 67, endorsing the remarks in
Steinberg
supra, in para 11.
[31]
Footnotes omitted, and underlining supplied for
highlighting.
[32]
The statement in
Steinberg
of the reason for the distinction was endorsed in
Reflect-All
supra, in para 63.
[33]
Kaiser Aetna v United States
[1979] USSC 179
;
444 US 164
, 174-5 (1979);
Hodel
v Irving
[1987] USSC 79
;
481 US 704
,
713-4 (1987); and
Lucas v South
Carolina Costal Council
505 US 1003
,
1015 (1992).  The notion of constructive expropriation as a
concept in US law appears to have derived from the remark of

Holmes J in
Pennsylvania Coal Co.
v. Mahon
,
[1922] USSC 193
;
260 U.S. 393
,
43 S.Ct. 158
,
67 L.Ed. 322
(1922), that ‘
while
property may be regulated to a certain extent, if regulation goes
too far it will be recognized as a taking
’.
In his dissenting Opinion in
Lucas
supra, Justice Stevens cited a number
of US Supreme Court decisions in which it had been held that in some
circumstances a law
that renders property valueless nonetheless does
not constitute a taking.
[34]
Steinberg
in
para 10.
[35]
‘
Deproclamation
’
is a word that does not yet appear to have obtained recognition in
the Oxford English dictionaries, but it is listed in
the
Dictionary
of South African English on Historical Principles
,
an online publication developed by the Dictionary Unit for South
African English, an affiliate institute of Rhodes University.

The use of its derivative ‘
deproclaim
’
in our jurisprudence goes back at least the better part of a
century; cf.
Pienaar v Treasure Trove
Diamonds Ltd
1931 AD 354
at 365.
[36]
Nkabinde J remarked ‘
Cloete
AJA
[in
Steinberg
]
considered the possibility that there
may be room to develop a narrow doctrine of constructive
expropriation for the South African
context, especially in cases
where a public body utilises its power to regulate private property
so excessively that it may be
characterised as expropriation; in
other words, when the regulation in a particular case goes too far.
I am not sure whether
this would be appropriate in our
constitutional order. This in any event is not such a case. If
regulation in cases such as the
present were to be characterised as
amounting to expropriation, government would be crippled in
discharging its obligations in
regulating
the use of private property for public good
.’
[37]
Footnotes omitted.
[38]
In para 64.
[39]
In para 63-64
[40]
In para 64.
[41]
Agri SA
(CC)
supra, in para 58.