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[2016] ZASCA 125
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Shelton avd Another v Eastern Cape Development Tribunal and Others (489/2015) [2016] ZASCA 125 (26 September 2016)
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THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Reportable
Case
No: 489/2015
In
the matter between:
MARK
WILLIAM
SHELTON
FIRST APPELLANT
JONATHAN
ANDREW CAMPBELL
SECOND APPELLANT
and
EASTERN
CAPE DEVELOPMENT TRIBUNAL
FIRST RESPONDENT
PA
RIVER DEVELOPMENT COMPANY
PROPRIETARY
LIMITED
SECOND RESPONDENT
EASTERN
CAPE DEVELOPMENT APPEAL TRIBUNAL
THIRD RESPONDENT
Neutral
citation:
Shelton
v Eastern Cape Development Tribunal
(489/2015)
[2016] ZASCA 125
(26 September 2016)
Coram:
Lewis, Wallis, Willis and Saldulker JJA
and Potterill AJA
Heard:
23 August 2016
Delivered:
26 September 2016
Summary
:
Constitutional law – Practice – Construction
of judgments
and orders – Principles applicable – When Chapters V and
VI of the
Development Facilitation Act 67 of 1995
declared invalid,
by Constitutional Court, declaration of invalidity suspended for 24
months on conditions – Suspension period
expiring without
enactment of remedial legislation – court order not granting
tribunal power to decide application after
expiry of suspension
period – appeal upheld.
ORDER
On
appeal from:
Eastern Cape Division of
the High Court, Grahamstown (Mgxaji AJ sitting as court of first
instance):
1
The appeal is upheld.
2
The costs are to be borne by the First Respondent.
3
The order of the court a quo is set aside and the following
order is substituted in its place:
‘
(a)
It is declared that the First Respondent had no jurisdiction under
s
33
of the
Development Facilitation Act 67 of 1995
to decide upon the
Second Respondent’s application [10/5/4/4] after 17 June 2012.
(b)
The decision by the First Respondent to grant the establishment of
land development on:
(i)
Part/portion of the remainder of Erf 361,
Port Alfred (to be known as the remainder of Erf 5513, Port Alfred);
and
(ii)
The remainder of Erf 642, Port Alfred (to
be known as the remainder of Erf 5513, Port Alfred), is set aside.
(c)
The costs are to be borne by the First Respondent.’
JUDGMENT
Potterill
AJA (Lewis, Wallis, Willis and Saldulker JJA concurring):
[1]
Chapters V and VI of the Development Facilitation Act 67 of 1995
(DFA)
[1]
that
empowered a provincial development tribunal to decide a land
development application were declared constitutionally invalid
by the
Constitutional Court on 18 June 2010.
[2]
The
invalidity was suspended for 24 months in order to enable remedial
legislation to be passed. However, the Legislature did not,
in the
period of suspension, rectify the position or enact new legislation.
The crux of this appeal is whether a development tribunal
retained
the power, after the expiry of the suspension period, and therefore
at a time when the order of constitutional invalidity
was operative,
to determine an application lodged with it prior to the expiry of the
suspension period. In this matter the second
respondent, PA River
Development Company (Pty) Ltd (PA River), lodged with the first
respondent, the Eastern Cape Development Tribunal
(the tribunal), on
15 June 2012, one working day before the expiry of the suspension
order an application to develop land in Port
Alfred. The two
appellants, Mr Mark Shelton and Mr Jonathan Campbell (first and
second appellant respectively), filed an objection
to this
application. The tribunal granted the application on 28 January
2013, some seven months after the period of suspension
had expired.
[2]
The appellants instituted review proceedings in the Eastern Cape High
Court, Grahamstown for an order declaring that the tribunal
had no
jurisdiction or entitlement in law to consider and decide PA River’s
application after 17 June 2012. The appellants
sought further relief
which fell by the wayside. Mgxaji AJ found that the tribunal was
empowered to decide the land development
application despite the
suspension period having expired, and accordingly dismissed the
review application. It is against this
order that the appellants,
with leave of the court a quo, bring this appeal. Only the first
respondent has opposed the appeal and
I shall refer to it as the
respondent.
[3]
The determination of this appeal depends upon a proper interpretation
of the suspension order of the Constitutional Court: to
ascertain the
manifest purpose of the order. To put it plainly, did the court
intend that 17 June 2012 (the expiry date of the
suspension order)
would be the cut-off date and that no further decisions should be
made in terms of the abovementioned constitutionally
impugned
chapters of the DFA? The court’s intention is to be ascertained
from the language of the order, which is to be interpreted
on its
terms and the court’s reasons given as whole.
[3]
[4]
The DFA created provincial development tribunals. In terms of
Chapters V and VI, these provincial development tribunals had
the
power to regulate land use within municipal areas. The powers
conferred on the provincial development tribunals conflicted
with the
constitutional reservation of power to execute municipal planning to
municipalities. This court found that to be in conflict
with the
Constitution,
[4]
in that it
permitted provincial bodies to take on the function of municipal
planning. This court accordingly declared Chapters V
and VI of the
DFA constitutionally invalid.
[5]
The
declaration of invalidity was suspended for 18 months from the date
of the order subject to the following suspension orders
(para 50):
‘
(a)
No
development tribunal established under the Act may accept for
consideration or consider any application for the grant or alteration
of land use rights in a municipal area.
(b)
No
development tribunal established under the Act may on its own
initiative amend any measure that regulates or controls land use
within a municipal area.’
[5]
On 18 June 2010 the Constitutional Court confirmed the declaration of
constitutional invalidity of this court.
[6]
It held that
the declaration of invalidity must be suspended for a period to avoid
a complete halt of land development, prejudicing
prospective land
developers, which in turn could negatively impact on the economic
growth of the country.
[7]
It was in
the interest of the administration of land use and good governance to
suspend the order.
[8]
The
Constitutional Court considered 24 months to be a reasonable period
within which Parliament could enact new legislation or rectify
the
defects identified.
[9]
New
legislation was however not enacted within the 24 months.
[6]
The Constitutional Court set aside para 2 (the suspension conditions
imposed by this court) and replaced it with the following
order (para
95):
‘
7.
The declaration of invalidity is suspended for 24 months from the
date of this order to enable Parliament to correct the defects
or
enact new legislation.
8.
The suspension is subject to the following conditions:
(a)
Development
tribunals must consider the applicable integrated-development plans,
including spatial-development frameworks and urban-development
boundaries, when determining applications for the grant or alteration
of land-use rights.
(b)
No
development tribunals established under the Act may exclude any bylaw
or Act of Parliament from applying to land forming the
subject-matter
of an application submitted to it.
(c)
No
development tribunal established under the Act may accept and
determine any application for the grant or alteration of land-use
rights within the jurisdiction of the City of Johannesburg
Metropolitan Municipality or eThekwini Municipality, after the date
of this order.
(d)
The relevant
development tribunals may determine applications in respect of land
falling within the jurisdiction of the City of
Johannesburg
Metropolitan Municipality or eThekwini only if these applications
were submitted to it before the date of this order.
[7]
The Constitutional Court explained the setting aside of para 2 as
being necessary on the basis of new evidence which had been
placed
before it by the
amici
curiae
and the
provincial departments of KwaZulu-Natal and Mpumalanga. This evidence
was to the following effect. When the Interim Constitution
[10]
reconfigured
the provinces, the former self-governing homelands and the
‘independent’ States of Transkei, Bophuthatswana,
Venda
and Ciskei became part of the new provinces. These areas were
incorporated with their applicable laws regulating land
administration.
This resulted in fragmented pieces of legislation
applicable to one area and the DFA was designed to address this
problem.
[11]
The new
evidence before the court was that in most municipalities where these
ordinances applied, the municipalities lacked the
capacity to
exercise the powers contained therein.
[12
[8]
Paragraph 2 of this court’s
order had the effect of precluding development tribunals from
accepting fresh applications during
the period of suspension.
Paragraphs 8(
c
)
and (
d
)
of the CC order on the other hand precluded them from receiving such
applications in relation to Johannesburg and eThekwini and
indicated
how pending applications in those areas were to be disposed of. Other
development tribunals could receive fresh applications
during the
period of suspension. That leaves the question whether they were
empowered in relation to such applications to deal
with and determine
them once the period of suspension was over and the relevant
legislative provisions became constitutionally
invalid.
[9]
A declaration of invalidity of post-Constitution legislation has
retrospective effect from the date on which the Act was enacted.
[13]
Suspension
of the declaration means that the invalid law continues to apply
during the period of suspension.
[14]
The
Constitutional Court found it just and equitable in regard to the DFA
not to order that the invalidity take immediate effect
and therefore
suspended the order for a generous period of 24 months for Parliament
to enact new legislation or to correct the
defects. It recognised
that Parliament might not remedy the invalidity within two years and
said the following in regard to the
possible retrospectivity of the
order of constitutional invalidity:
[15]
‘
Finally,
a necessary feature of this suspended declaration of invalidity is
that it should not have retrospective effect if the
period of
suspension expires without the defects in the Act having been
corrected. In exercising their powers under the impugned
chapters,
development tribunals have approved countless land developments
across the country. It would not be just and equitable
for these
decisions to be invalidated if the declaration of invalidity comes
into force.’
Counsel
for the respondent submitted that although the court only referred to
approved applications it should be interpreted to
embrace all
applications submitted, including those not determined before the
order of invalidity came into force, because the
court did not set a
cut-off date to receive new applications. This paragraph, however,
did no more than to expressly apply the
general principle that an
order of invalidity should have no effect on matters which were
finalised prior to the date of the order
of invalidity coming into
effect. It was expressly addressed to applications finalised before
the expiry of the period of suspension,
not the fate of applications
not finalised by that date.
[10]
We were urged to interpret the Constitutional Court’s condition
of suspension in 8
(a)
of the order as not only providing for
the making, processing and adjudication of applications in the period
of suspension but also
for the adjudication of all outstanding
applications after the expiry of the period of suspension. The
condition of suspension
in 8
(a)
ordered tribunals to uphold
the municipalities’ integrated-development plans,
spatial-development frameworks and urban-development
boundaries when
determining applications for the grant or alteration of land-use
rights. Paragraph 83 of the judgment set out the
reason for this
condition thus:
‘
The
role played by these plans in the administration of land is
important. They provide for, among other things, the alignment of
resources utilised to supply basic services to local communities.
There can be no doubt that any development undertaken within
a
municipal area affects the budget of the municipality concerned,
particularly in the supply of services.’
This
provision was capable of applying to existing applications already
before development tribunals at the time the Constitutional
Court
gave its judgment and also to applications lodged after that date
because it deals only with the manner in which development
tribunals
were to resolve cases not whether they could continue to do so after
the expiry of the period of suspension.
[11]
The condition of suspension in para 8(
b
)
of the order prohibited development tribunals from exercising the
power in ss 33(2) and 51(2) of the DFA to exclude any by-law
or Act
of Parliament applicable to land. In para 84 of the CC judgment it
was held that this power enabled development tribunals
to intrude
unnecessarily into the domain of the Legislature. Once again this
provision was capable of being applied in relation
to pending
applications as well as new applications without indicating whether
the latter was permissible. This too is neutral
for the same reason
as in para 10.
[12]
Paragraph 8(
c
)
of the order prohibited the development tribunals having jurisdiction
in the areas constituting the City of Johannesburg Metropolitan
Municipality and the eThekwini Municipality from accepting or
determining any applications for the grant or alteration of land-use
rights after the date of the order, that is, after 18 June 2010.
Paragraph 8(
d
)
made provision for the disposition of the applications in those areas
that were pending prior to that date. The paragraph is relevant
because it is the only one in the Constitutional Court’s order
that prohibits development tribunals from dealing with fresh
applications during the period of suspension of invalidity. It was
relied upon by counsel for the respondent in support of the
argument
that during that period development tribunals were entitled to
receive and determine applications. That does not, however,
address
the problem occasioned by the period of suspension expiring when
applications lodged during that period were as yet unresolved.
[13]
Paragraphs 81 and 82 of the judgment provide the reasons for the
orders in 8
(c)
and 8
(d)
.
The tribunals in the two municipalities were barred from
considering new land development applications because these two
municipalities were authorised and had the capacity to deal with the
planning powers. The court held it was just and equitable
to protect
these municipalities from interference, but it was necessary for the
affected tribunals to finalise all pending applications
before them
during the suspension period. The reason why these two municipalities
were singled out was because evidence pertaining
to land use was put
before the court. Absence of information about the capacity of other
municipalities is the reason why paragraphs
8
(c)
and 8
(d)
were not extended to include all tribunals.
[14]
In summary, therefore, the Constitutional Court suspended the
declaration of constitutional invalidity for two years. The court
order permitted development tribunals to receive and dispose of
applications during the period of suspension of its order of
constitutional
invalidity. It foresaw the possibility that Parliament
might not pass remedial legislation within the period of suspension.
In
that event it specifically provided that applications already
disposed of under Chapters V and VI of the DFA would not be rendered
invalid as a result of the constitutional invalidity of those
provisions. But it was silent on the position of applications lodged
during the period of suspension but not determined during that
period.
[15]
The question is whether the appellants are correct in saying that,
once the period of suspension passed, the development tribunals
lost
the power to deal with outstanding applications, or whether the
respondents are correct in saying that the power to deal with
such
outstanding applications is to be implied in the order of the
Constitutional Court. There was no evidence before us that the
municipality in this matter did not have the capacity to deal with
applications in respect of land falling within its jurisdiction
and
that therefore the tribunal should continue to determine matters. The
difficulty is that the tribunal could not continue to
determine the
application after the period of suspension because the DFA was
inconsistent with the Constitution. The tribunal’s
only
lifeline was the period of suspension. The Constitutional Court
extended the 18 month suspension period of this court to 24
months
finding it a reasonable time-frame by which to rectify the identified
problems. It therefore did not, in terms of the order,
intend to
cater for any determinations after the 24 months suspension period.
[16]
What is clear is that tribunals in those two municipalities only had
the capacity to determine applications, which were submitted
before
the date of the Constitutional Court’s order, within the
suspension period and there is nothing in the orders or reasons
from
which an intention can be inferred that other tribunals in other
municipalities could, against constitutional principles of
retrospectivity, determine applications after the period of
suspension. In
Cross-Border
Road Transport Agency v Central African Road Services (Pty) Ltd &
others,
[16]
the
Constitutional Court was also confronted with the question of the
principles governing the operation of orders of constitutional
invalidity that are suspended, where the suspension period passed
without the enactment of remedial legislation. The court confirmed
the default position that the law will be invalid from the moment it
was promulgated unless varied by an order of court.
[17]
In this case
there is no order varying the default position. There is nothing in
the order that invites an interpretation that the
Constitutional
Court intended to vary the default position. If such an unusual order
were intended, one would have expected the
Constitutional Court to
have expressed it in clear language setting out the circumstances
which existed to justify the exercise
of that unusual power.
[18]
This is
especially so as a court cannot revive an invalid Act, but may only
preserve its validity during the period of suspension.
[19]
[17]
Respondent’s counsel relied on what he argued was a necessary
implication from the fact that the order permitted development
tribunals to receive fresh applications during the period of
suspension of constitutional invalidity. However, the Constitutional
Court was alive to the possibility that the period of suspension
might pass without the enactment of remedial legislation. It dealt
with that in para 85 of its judgment without providing that, in that
event, all pending applications, whether lodged within the
period of
suspension or otherwise, should be determined by development
tribunals. But since the relevant provisions were constitutionally
invalid, such an implication is precluded. This is fortified by the
fact that a necessary implication can never be contrary to
constitutional principles pertaining to invalidity; expiry of the
suspension order renders the Act retrospectively invalid, subject
to
the reservation already dealt with in respect of determined
applications. Counsel also sought to rely on s 12(2)
(c)
of
the Interpretation Act 33 of 1957. He argued that PA River had
acquired a right for its application to be determined and no Act
must
be interpreted retrospectively so as to take away or impair a vested
right.
[20]
At best for
PA River, however, it had a right during the period of suspension to
lodge an application. The right was qualified by
the fact that, after
the expiry of the suspension period, the tribunal could not exercise
powers declared to be unconstitutional.
[18]
The lodging of the application, opportunistically one day before
expiration of the suspension period, could not preserve the
powers of
the tribunal to decide the matter after the expiry of the suspension
date. The tribunal should not have accepted an application
one day
before the expiry of the 24 months’ suspension period as the
application could not be decided within a day. After
the
Constitutional Court judgment, the Department of Rural Development
and Land Reform issued a
Policy
Statement
.
[21]
The official
position regarding applications received in terms of the DFA before
17 June 2012 was set out in para 4.1, with 4.1(b)
stating that
‘
applications
received by development tribunals before 17 June 2012 will continue
to be heard and determined by the tribunals even
after 17 June 2012
as if the Constitutional Court had not declared invalid Chapters V
and VI of the DFA’.
It
was argued that the tribunal thus acted as advised. If the tribunal
was relying on the
Policy Statement
to decide the matter, then it was ill-advised to do so because a
policy statement cannot preserve an invalid Act.
[19]
Parliament enacted the Spatial Planning and Land Use Management Act
16 of 2013 (SPLUMA) which came into operation on 1 July
2013, three
years after the expiry of the suspension period. Section 59 of SPLUMA
repealed the DFA in its entirety. The court below
found that s 60(2)
of SPLUMA entitled the tribunal to decide the matter. It
provides:
‘
[a]ll
applications, appeals or other matters pending before a tribunal
established in terms of Section 15 of the [DFA] that have
not been
decided or otherwise disposed of, must be continued and disposed of
in terms of this Act.’
The
tribunal could only, in terms of s 60(2) of SPLUMA, decide the matter
if the tribunal acted lawfully in terms of the DFA. The
reality is
that the DFA was invalid when the tribunal took its decision and the
transitional provisions of SPLUMA cannot be utilised
to validate the
decision.
[20]
The tribunal derived its authority to decide PA River’s
application from the chapters that were declared invalid. Upon
expiry
of the suspension period, 17 June 2012, the tribunal no longer had
the power to decide the application.
[21]
In the result the following order is made:
1
The appeal is upheld.
2
The costs are to be borne by the First Respondent.
3
The order of the court a quo is set aside and the following
order is substituted in its place:
‘
(a)
It is declared that the First Respondent had no jurisdiction under
s
33
of the
Development Facilitation Act 67 of 1995
to decide upon the
Second Respondent’s application [10/5/4/4] after the expiry of
the Constitutional Court’s suspension
order.
(b)
The decision by the First Respondent to grant the establishment of
land development on:
(i)
Part/portion of the remainder of Erf 361,
Port Alfred (to be known as the remainder of Erf 5513, Port Alfred);
and
(ii)
The remainder of Erf 642, Port Alfred (to
be known as the remainder of Erf 5513, Port Alfred), is set aside.
(c)
The costs are to be borne by the First Respondent
’
________________
S
Potterill
Acting
Judge of Appeal
APPEARANCES:
For
the Appellants:
E A S Ford SC
Instructed
by:
Rushmere Noach Inc, Port Elizabeth
McIntyre
& Van der Post, Bloemfontein
For
the First Respondent:
T J M Paterson SC (with him N J Sandi)
Instructed
by:
L G Nogaga Attorneys, Grahamstown
State
Attorney, Bloemfontein
[1]
The Act
came into effect on 22 December 1995 and it was repealed in whole
with effect from 1 July 2015 in terms of s 59 read with
Schedule 3
of the
Spatial Planning and Land Use Management Act 16 of 2013
.
[2]
Johannesburg
Metropolitan Municipality v Gauteng Development Tribunal &
others
[2010]
ZACC 11
;
2010 (6) SA 182
(CC)
(CC
Judgment)
.
[3]
Firestone
South Africa (Pty) Ltd v Gentiruco AG
1977 (4)
298 (A) at 304E;
Finishing
Touch 163 (Pty) Ltd v BHP Billiton Energy Coal SA Ltd & others
[2012] ZASCA 49
;
2013 (2) SA 204
(SCA) para 13;
Cross-Border
Road Transport Agency v Central African Road Services (Pty) Ltd &
others
[2015] ZACC 12
;
2015 (5) SA 370
(CC) para 22;
Eke
v Parsons
[2015] ZACC 30
;
2016 (3) SA 37
(CC) para 29;
True
Motives 84 (Pty) Ltd v Mahdi and another
[2009] ZASCA 4; 2009 (4) SA 153 (SCA).
[4]
Sections
151
and
156
read with Schedule 4 part B and Schedule 5 part B of the
Constitution of the Republic of South Africa, 1996.
Johannesburg
Municipality v Gauteng Development Tribunal & others
[2009]
ZASCA 106
;
2010 (2) SA 554
(SCA)
(SCA
judgment)
paras 5-14, where the legislative scheme is discussed.
[5]
SCA
judgment
para 50.
[6]
CC
judgment
para 95
[7]
CC
judgment
paras 74 and 79-81.
[8]
CC
judgment
para
80 fn 7.
[9]
CC
judgment
para 80.
[10]
Constitution
of the Republic of South Africa Act 200 of 1993 (Interim
Constitution).
[11]
In its long
title, the DFA mentions as one of its purposes:
‘
to
provide for nationally uniform procedures for the subdivision and
development of land in urban and rural areas so as to promote
the
speedy provision and development of land for residential,
small-scale farming or other needs and uses’.
[12]
CC
judgment
paras
24
and 79.
[13]
S
v Bhulwana; S v Gwadiso
[1995] ZACC
11
;
1996 (1) SA 388
(CC) paras 31 and 32.
[14]
Ibid.
[15]
CC
judgment
para
85.
[16]
[2015] ZACC
12; 2015 (5) SA 370 (CC)
[17]
Paragraph
20.
[18]
See
Minister
for Justice and Constitutional Development v Nyathi & others
[2009]
ZACC 29
;
2010 (4) SA 567
(CC) para 26.
[19]
Ntuli
(above)
para 30;
Ex
parte Minister of Social Development & others
[2006] ZACC
3
;
2006 (4) SA 309
(CC) paras 39-40.
[20]
Unitrans
Passenger (Pty) Ltd t/a Greyhound Coach Lines v Chairman, National
Transport Commission & others
[1999]
ZASCA 40
;
1999 (4) SA 1
(SCA) para 12.
[21]
Statement
by the Department of Rural Development and Land Reform on the
Spatial Planning and Land Use Management Bill (SPLUMB)
and the
Constitutional Court Judgment in the
Development Facilitation Act
(DFA
) case
,
22 March 2012 available on the Department of Rural Development and
Land Reform’s website at:
http://www.ruraldevelopment.gov.za/news-room/media-statements/file/1041-statement-by-the-department-of-rural-development-and-land-reform-on-the-spatial-planning-and-land-use-management-bill-splumb-and-the-constitutional-court-judgment-in-the-development-facilitation-act-dfa-case
(accessed on 7 September 2016).