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[2019] ZAGPJHC 197
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Umsobomvu Coal (Pty) Ltd v Transasia Minerals (Pty) Ltd and Others (09023/2019) [2019] ZAGPJHC 197 (29 March 2019)
REPUBLIC OF SOUTH AFRICA
IN THE HIGH COURT OF SOUTH AFRICA
GAUTENG LOCAL DIVISION,
JOHANNESBURG
CASE NO: 09023/2019
In the matter
between:
UMSOBOMVU
COAL (PTY)
LTD
Applicant
and
TRANSASIA
MINERALS (PTY)
LTD
First
Respondent
11
MILES INVESTMENTS (PTY)
LTD
Second
Respondent
MINISTER
OF
POLICE
Third
Respondent
PHILLIP
LEVINSOHN
N.O
Fourth
Respondent
J U D G M E N T
MODIBA
J:
[1] On 3 March
2019, the applicant obtained an arbitration award on an urgent basis,
directing the respondents, its agents and employees
to afford the
applicant’s authorized representatives unrestricted 48 hour
access to immovable property comprising the Malonjeni
and Cambiran
mining rights (“the mining rights”) through the Transasia
gate.
[2] The award is
interim in nature. It was granted pending the resolution of the main
arbitration dispute between the parties, scheduled
for June 2019. In
the main dispute, the applicant seeks an order evicting the
respondents from the immovable property for the reason
that it has
cancelled the sale agreement entered into with the respondents in
2010, in terms of which the respondents purchased
the holdership of
the mining rights from the applicant.
[3] In these proceedings, the
applicant seeks to make the interim arbitration award an order of
court on an urgent basis, in order
to enforce it. The application is
opposed by the respondents who have counter applied for an urgent
stay and review of the arbitration
award. The respondents also seek
an interdict against the applicant from selling the holdership of the
mining rights. The applicant
opposes the counter application.
THE URGENCY OF
BOTH APPLICATIONS
[4] The applicant
sought and was granted the interim award on an urgent basis. I agree
with the applicant that the arbitrator’s
finding on urgency is
a substantive non-appealable finding. For that reason, the
enforcement of the award, which the applicant
may only achieve on the
strength of a court order, is also urgent.
[5] In any event,
the basis for urgency as found by the arbitrator continues to
prevail. The applicant requires access to the properties
to compile
the revised Social Labour Plan (“SLP”) in respect of the
Malonjeni mines. The arbitrator found that the
applicant carries such
an obligation as the holder of the mining right in terms of the
Mineral and Petroleum Resources Development
Act (“MPRD Act”)
and the mining charter. The applicant alleges that absent compliance,
it may lose the mining right.
Such a loss would cause it irreparable
harm, as it would render the arbitration proceedings moot.
[6]
The respondents resist the arbitration award being made an order of
court on the basis that it is susceptible for review in
terms of
section 33(1) (b) of the Arbitration Act
[1]
.
Therefore if the court finds that the application is urgent, they are
also entitled to an urgent audience in respect of the counter
application.
[7] The review of
the award became the main bone of contention between the parties
during these proceedings; for a good reason.
If upheld, the award
becomes a nullity. Therefore the application to have it made an order
of court becomes redundant. So is the
respondents’ prayer for a
stay. If the review is dismissed, the application to have the award
made an order of court would
succeed. The respondents’ prayer
for a stay of the order would not be sustained.
[8] The
respondents’ interdictory relief will be the only prayer that
remains to be determined. It was not specifically argued.
It will
therefore be determined on the basis of the papers filed, as well as
the parties’ written submissions.
[9] Therefore the
urgency of the application and the counter application are no doubt
intertwined. For these reasons, I find that
both applications are
urgent.
[10] The review application is ready
for hearing as the full arbitration record is before court.
THE REVIEW
APPLICATION
[11] The
respondents seeks to challenge the interim arbitration award in terms
of section 33(1) (b) of the Arbitration Act on the
basis that:
[11.1] the
arbitrator lacks jurisdiction to grant the order for access;
[11.2] if the
arbitrator is found to have jurisdiction, by granting the order, the
arbitrator committed a gross irregularity by
making an order which
impacts the respondents rights, which stand to be determined in the
main dispute;
[11.3] it is
defective and therefore vague in that it fails to limit the purpose
of access to completing the SPL, which was the
basis for seeking the
order in the first place.
[12] The applicable
legal principles for the review of arbitration awards are trite. I
briefly state them below.
[13]
The power of a court to review a consensual arbitration award is
limited to the grounds listed in section 33(1). There are
no residual
common law grounds on which the court may review an arbitration award
made in terms of the Act.
[2]
To succeed under section 33(1) (a) and (b) ,
[3]
the applicant ought to show that:
13.1 the arbitrator misconducted
himself in relation to his duties as an arbitrator; or
13.2 the arbitrator has committed a
gross irregularity in the conduct of the arbitration proceedings; or
13.3 the arbitrator exceeded his
powers.
[14]
A finding that the arbitrator committed a factual error leading him
to a wrong conclusion is insufficient to render the arbitrator’s
award reviewable. Such an error only renders an award reviewable if
it results from failure by the arbitrator to act in terms of
his
mandate.
[4]
[15] The arbitrator
determined the interim award on the basis of the parties’
written submissions. He specifically requested
the parties to make
submissions on whether he has jurisdiction in respect of the interim
arbitration award sought by the applicant.
The applicant contended
that he did. The respondent contended that he did not. He ruled that
he had jurisdiction and then proceeded
to determine the interim
reward.
[16]
By ruling over this question, the arbitrator did not determine his
own jurisdiction as contended on behalf of the respondents.
If he
lacked the competency to determine this question, it would mean that
whenever a question in respect of the arbitrator’s
jurisdiction
arises in arbitration proceedings, only the High Court may rule over
this issue. This will not only result in a multiplicity
of
proceedings, it is not consistent with authorities. The arbitrator
ought to rule on this issue if it arises in proceedings before
him.
What he is precluded from doing, is to fix his own jurisdiction i.e.
by expanding its scope.
[5]
[17] The fact that
access to the immovable property is not part of the relief sought in
the arbitration agreement as contended on
behalf of the respondents,
does not follow that the relief is not interlocutory. In the main
proceedings, the applicant asserts
cancellation of the agreement and
for that reason, it seeks an order evicting the respondents from the
immovable properties. If
the applicant succeeds, the respondents will
have to vacate the property. The applicant will have access to it.
Therefore allowing
access to the immovable property as a temporary or
interim measure, arises from the terms of the dispute the arbitrator
is seized
with.
[18] Therefore the
arbitrator derives jurisdiction from three sources:
[18.1] Clause 11 of the arbitrator
agreement which provides:
“
11.1
Any and all disputes arising from or in connection with this
Agreement shall be finally resolved in accordance with the rules
of
the Arbitration Foundation of South Africa by a single arbitration in
Sandton, appointed by the Arbitration Foundation of South
Africa, or
its successor in title.
“
11.2
The provisions of clause 11.2 shall not preclude any party from
obtaining interim relief on an urgent basis from a court of
competent
jurisdiction pending the decision of the arbitrator.”
[18.2] the terms of
the arbitration dispute as reasoned above;
[18.3] Rule 7 of
the Arbitration Foundation of South Africa (“AFSA”)
Expedited Rules which provides:
‘
Interlocutory
matters and temporary orders
Should
the need arise for any party to seek interim or temporary relief
before the arbitration is finalised, that party may apply
to the
ARBITRATOR to grant such interlocutory order or give the required
temporary relief and the ARBITRATOR shall have the same
power to do
so as if the matter were one heard by a Judge of the High Court save
that if by law such power or order cannot be exercised
or given by an
ARBITRATOR then, and then only, should the parties refer such matter
to an appropriate Court.’
[19]
Clause 11.2 which the respondents sought to rely on, is by virtue of
the authority in
Radon
Projects (Pty) Ltd
[6]
inapplicable
in the present circumstances. 11.2 does not exclude the jurisdiction
of the arbitrator in urgent proceedings. It rather
protects a party’s
entitlement to seek urgent relief from a court. It is for the party
who brings such proceedings to elect
the forum for such proceedings.
The applicants’ selection to seek interim relief from the
arbitrator cannot be faulted in
the present circumstances.
[20]
By granting the applicant access to the immovable property, the
arbitrator did not determine any issue in the main dispute.
He did so
on the basis of the applicant’s prevailing holdership of the
mining rights and its consequential right to access
the property over
which the applicant holds the said rights in terms of section 5(3) of
the Minerals Petroleum Resources Development
Act
[7]
(“the MPRD Act”). The respondents’ right of
occupation over the property and the sale agreement does not disturb
the applicant’s holdership and any right or obligations
consequent thereon, until the holdership is transferred in terms
of
section 11 of the MPRD Act.
[21] In the interim
award, the arbitrator made no pronouncement on whether the applicant
is entitled to evict the respondents based
on its cancellation of the
sale agreement or whether the respondents are entitled to specific
performance, alternatively damages.
Pronouncing on the applicant’s
holdership rights as a
prima facie
finding to determine the requirements for interim relief has no
bearing on the issues the arbitrator is required to determine in
the
main dispute.
[22]
It must then follow, that the arbitrator committed no irregularity as
contended by the respondents because he did not take
away the
respondents’ procedural right to have the main issues
determined at the appropriate hearing. Had he done so, his
conduct
would fall into the rubric of procedural irregularity as contemplated
In
Telcordia
Technologies Inc v Telkom SA Ltd
.
[8]
I find that the arbitrator did not commit the irregularity complained
of.
[23] In the
arbitration award, the arbitrator incorrectly refers to ownership of
mining rights where he ought to have made reference
to holdership of
mining rights. It is trite that in terms of the MPRD Act, only the
government is the owner of such rights. Private
entities may only
hold such rights. This error does not render the award reviewable as
it is not procedural.
[24]
The arbitrator also incorrectly referred to Transasia Minerals (Pty)
Ltd in in the arbitration award. The correct entity is
Transasia 1
(Pty) Ltd. The parties agree that this is a patent error that this
court may correct in terms of section 31(2)
[9]
of the Arbitration Act.
[25] In the
premises, the review application and the prayer for the stay of the
arbitration award stands to be dismissed. The application
to make the
interim arbitration award an order of court stands to be granted.
[26] The applicants seek an order
directing the third respondent to escort and assist them to enforce
the court order as may be
necessary. The respondent dispute this
relief on spurious grounds. The prayer sought by the applicant falls
within the duties of
the third respondent. The third respondent does
not oppose it. It therefore stands to be granted.
INTERDICTORY
RELIEF
[26] In their
papers, the respondents expressed an apprehension that the applicant
intends selling the mining rights to a third
party, hence it seeks
access to the immovable property to determine the improvements the
respondents have made thereon in order
to determine its value. It
cited numerous instances were Kunene, a presentative of the
applicant, attempted to either obtain unauthorized
access to the
immovable property or information on the improvements made on the
property. The respondents’ allegations regarding
the intended
sale of holding rights to a third party are bald, unsubstantiated and
based on speculation. Therefore the respondents
fail to meet the
requirements in
Plascon Evans
to raise a rebuttal onus against the applicant. I find that the
respondents make out no case for this relief.
[27] In the premises, the following
order is made:
ORDER
APPLICATION TO
MAKE THE AWARD AN ORDER OF COURT
1.
The non-compliance with
the Uniform Rules of Court with regard to service and time limits is
condoned. This application is heard
as one of urgency in terms of
rule 6(12).
2.
The application
succeeds.
3.
The arbitration award
is corrected as follows:
“
Transasia
Minerals (Pty) Ltd” in the heading of the Arbitral Award is
deleted and substituted by “Transasia 1 (Pty)
Ltd”.
4.
The arbitration award
granted by the fourth respondent, dated 2 March 2019, as corrected
above in terms of
section 31
(2) of the
Arbitration Act 42 of 1965
,
is made an order of court.
5.
The third respondent is
ordered to take such steps as may be necessary to escort and assist
the applicant to gain access to the
properties referred to in the
arbitration award and in accordance with the provisions of the
arbitration award.
6.
The first and second
respondent shall pay the costs of the application.
THE COUNTER
APPLICATION
1.
The non-compliance with
the Uniform Rules of Court with regard to service and time limits is
condoned. This application is heard
as one of urgency in terms of
rule 6(12).
2.
The application is
dismissed.
3.
The first and second
respondent shall pay the costs of the application.
________________________
MADAM
JUSTICE
L
T MODIBA
JUDGE OF THE
HIGH COURT
GAUTENG LOCAL
DIVISION, JOHANNESBURG
Counsel
for applicant:
Advocate
A Milovanovic-Bitter
Attorney
for applicant:
Edward
Nathan Sonnenbergs
Counsel
for respondents:
Advocate
D Mpofu SC assisted by Advocate P Daniel
Attorney
for respondents:
Mabuza
Inc
Date heard: 22 March 2019
Date of judgment: 29 March 2019
[1]
42
of 1965
[2]
Amalgamated
Clothing and Textile Workers Union of South Africa v Veldspun (Pty)
Ltd
[1993] ZASCA 158
;
1994
(1) SA 162
(A);
Telcordia
Technologies Inc v Telkom SA Ltd
[2006] ZASCA 112
;
[2007] 2 All SA 243
(SCA) (paragraph [51] at 259-260.
[3]
Section
33
of the
Arbitration Act provides
as follows:
“
(1)
Where –
(a)
any
member of an arbitration tribunal has misconducted himself in
relation to his duties as arbitrator or umpire; or
(b)
an
arbitration tribunal has committed any gross irregularity in the
conduct of the arbitration proceedings or has exceeded its
powers;
or
…
the
court may, on the application of any party to the reference after
due notice to the other party or parties, make an order
setting the
award aside.
”
[4]
Stocks
Civil Engineering (Pty) Ltd v Rip NO and Another
[2002]
3 BLLR 189
(LAC).
[5]
Radon
Projects (Pty) Ltd v NV Properties (Pty) Ltd and Another
2013 (6) SA 345
(SCA) at paras 23, 28, 29 and 31.
[6]
Supra
.
[7]
28
of 2002
[8]
Fn
2 above at paras 3 and 4
[9]
31.
Award may be made an order of court
(2) The court to which application is
so made, may, before making the award an order of court, correct in
the award any clerical
mistake or any patent error arising from any
accidental slip or omission.