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[2014] ZASCA 185
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Competition Commission v Computicket (Pty) Ltd (853/2013) [2014] ZASCA 185; [2015] 1 CPLR 15 (SCA) (26 November 2014)
THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
REPORTABLE
Case
No: 853/2013
In
the matter between:
THE
COMPETITION
COMMISSION
...........................................................................
APPLICANT
and
COMPUTICKET
(PTY)
LTD
.......................................................................................
RESPONDENT
Neutral
citation:
The Competition Commission
v Computicket
(853/13)
[2014] ZASCA 185
(26 November 2014).
Coram:
Brand, Ponnan, Theron, Zondi JJA
et
Fourie AJA
Heard:
12 November 2014
Delivered:
26 November 2014
Summary:
Competition Act 89 of 1998 (the Act) – after the amendment to
s 168(3) of the Constitution in terms of the 17
th
Constitution Amendment Act 2012 – appellate jurisdiction of the
SCA confined to matters contemplated in s 62(2) of the
Act –
meaning of ‘constitutional matter’ in s 62(2)(
b
)
of the Act – whether appellate jurisdiction in ‘constitutional
matters’ reserved for the Constitutional Court
exclusively in
terms of s 63(2) of the Act – application for leave to
appeal – consideration of prospects of success
on appeal.
ORDER
On
appeal from:
Application for leave to
appeal to this court against a judgment and order of the Competition
Appeal Court of South Africa (Swain
AJA, Davis JP and Dambuza JA,
concurring):
The
application for leave to appeal is dismissed with costs, including
the costs of two counsel.
JUDGMENT
Brand
JA
(Ponnan, Theron, Zondi JJA
et
Fourie AJA concurring):
[1]
This is an application for leave to appeal to this court against a
judgment and order of the Competition Appeal Court (the CAC)
which
overturned the dismissal of an interlocutory application by the
Competition Tribunal (the Tribunal). The applicant is the
Competition
Commission (the Commission) and the respondent is Computicket (Pty)
Ltd (Computicket). The matter has its origin in
five complaints which
were submitted to the Commission against Computicket in terms of
s 49B of the Competition Act 89 of
1998 (the Act). These
complaints arose from the exclusivity clauses contained in contracts
entered into by Computicket with theatre
owners, festival event
organisers and others in the entertainment industry, for the
provision of ticket distribution services.
[2]
Following upon investigations into these complaints, the Commission
decided that prohibited practices by Computicket had been
established
as envisaged by the Act, in that it had involved itself in
exclusionary and anti-competitive conduct. In consequence
the
Commission filed a referral of these complaints to the Tribunal in
terms of s 50(2)(
a
)
of the Act. After pleadings had been closed and discovery completed,
but before any evidence was led, Computicket brought an application
before the Tribunal to review and set aside the decision by the
Commission to refer the complaints, on the basis that, in taking
that
decision, the Commission had failed to act reasonably, objectively
and in good faith.
[3]
But, before the Tribunal could hear the review application,
Computicket launched an interlocutory application which moved
proceedings
a step even further away from the hearing on the merits
of the case. In this interlocutory application, which led to the
present
proceedings, Computicket essentially sought production of the
record on which the challenged decision was based. In the event, the
Tribunal refused to grant the relief sought. An appeal to the CAC
against that refusal proved to be successful. The CAC granted
the
following order:
‘
(a)
The appeal is upheld and . . . the Tribunal’s decision is
substituted by the orders in paragraphs (b), (c) and (d) below.
(b) The respondent
[the Commission] is directed to discover the reports and
recommendations which were placed before the Competition
Commissioner
and/or the Executive Committee of the Competition Commission, when
the decision was taken to refer the complaints
of alleged dominance
against the appellant to the Competition Tribunal, save however that
the respondent is not obliged to produce
the contents of such reports
and recommendations in accordance with Rule 14 of the Rules of the
Commission, except to the extent
and in the respects set out in
paragraph (c).
(c) The respondent
is directed to discover and produce for inspection all of the
evidence which was placed before the Competition
Commissioner and/or
the Executive Committee of the Competition Commission, when the
decision was taken to refer the complaints
of alleged dominance
against the appellant, to the Competition Tribunal, including the
evidence upon which the reports and recommendations
referred to in
paragraph (b) were based.
(d)
The appellant is awarded costs such costs to include the costs of two
counsel.’
[4]
The Commission applied to the CAC for leave to appeal to this court
against that order. The application was, however, refused
on 20
September 2013. Following upon the refusal, the Commission brought an
application for the same relief in this court. In the
event, two of
our colleagues referred that application for oral argument in terms
of s 21(3)(
c
)(ii)
of the Supreme Court Act 59 of 1959. During the course of hearing
that argument, counsel for both parties also accepted the
invitation
to address us on the merits of the appeal. Before considering these
arguments, there is, however, another matter. In
its judgment
refusing leave, the CAC raised an issue which appears to be
antecedent to all others. It is this: would this court
have
jurisdiction to hear the appeal proposed by the application in the
light of the 17
th
Constitution Amendment Act which took effect on 23 August 2013?
Jurisdiction
of this court
[5]
In considering this issue the starting point seems to lie in ss 62
and 63 of the Act. They provide in relevant part:
‘
62
Appellate jurisdiction
(1) The Competition
Tribunal and Competition Appeal Court share exclusive jurisdiction in
respect of the following matters:
(a)
Interpretation and application of Chapters 2, 3 and 5, other than –
(i)
a question or matter referred to in subsection (2); or
(ii)
. . .
(b)
the functions referred to in sections 21(1), 27(1) and 37, other than
a question or matter referred to in subsection (2).
(2) In addition to
any jurisdiction granted in this Act to the Competition Appeal Court,
the Court has jurisdiction over –
(a)
the question whether an action taken or proposed to be taken by the
Competition Commission or the Competition Tribunal is within
their
respective jurisdictions in terms of this Act;
(b)
any constitutional matter arising in
terms of this Act; and
(c)
the question whether a matter falls within the exclusive jurisdiction
granted under subsection (1).
(3) The jurisdiction
of the Competition Appeal Court –
(a)
is final over a matter within its exclusive jurisdiction in terms of
subsection (1); and
(b)
is neither exclusive nor final in respect of a matter within its
jurisdiction in terms of subsection (2).
(4) An appeal from a
decision of the Competition Appeal Court in respect of a matter
within its jurisdiction in terms of subsection
(2) lies to the
Supreme Court of Appeal or Constitutional Court, subject to section
63 and their respective rules.
(5) . . .
63 Leave to appeal
(1) The right to an
appeal in terms of section 62(4) –
(a)
is subject to any law that –
(i)
specifically limits the right of appeal set out in that section; or
(ii)
specifically grants, limits or excludes any right of appeal;
(b)
is not limited by monetary value of the matter in dispute; and
(c)
exists even if the matter in dispute is incapable of being valued in
money.
(2) An appeal in
terms of section 62(4) may be brought to the Supreme Court of Appeal
or, if it concerns a constitutional matter,
to the Constitutional
Court, only –
(a)
with leave of the Competition Appeal Court; or
(b)
if the Competition Appeal Court refuses leave, with leave of the
Supreme Court of Appeal or the Constitutional Court, as the case
may
be.
(3)
. . ..’
[6]
Section 62 undoubtedly constitutes a statutory endeavour to vest
final appellate jurisdiction with regard to matters referred
to in
sub-section (1) in the CAC. Conversely, the legislature’s clear
intent was to confine the appellate jurisdiction of
this court and
the Constitutional Court to matters referred to in s 62(2).
Nonetheless, despite this clearly expressed limitation
it was held in
American Natural Soda Ash Corporation & another v Competition
Commission & others
2005 (6) SA 158
(SCA) that this court
also has jurisdiction to hear matters contemplated in s 62(1).
This decision followed upon the earlier
judgment of
National Union
of Metal Workers of SA & others v Fry’s Metals (Pty) Ltd
2005 (5) SA 433
(SCA) which concerned the provisions of similar
import in
s 183
of the
Labour Relations Act 66 of 1995
. Both
these decisions were premised on s 168(3) of the Constitution
before its amendment by s 4 of the 17
th
Constitution
Amendment Act. In its unamended form s 168(3) provided:
‘
The
Supreme Court of Appeal may decide appeals in any matter. It is the
highest court of appeal except in constitutional matters,
and may
decide only-
(a) appeals;
(b) issues connected
with appeals; and
(c)
any other matter that may be referred to it in circumstances defined
by an Act of Parliament.’
[7]
In the light of s 168(3) this court held in
Fry’s
Metals
, as it was subsequently conveniently summarised in
American Natural Soda Ash
(at para 11):
‘
In
National Union of Metalworkers v Fry's
Metals
, which was argued before the
same panel in the same week as the present application, we held that:
[11.1] Any
legislative endeavour to vest final appellate jurisdiction in an
appeal Court other than this Court has to be judged
in the light of
the appellate structures created by the Constitution.
[11.2] The
Constitution provides not only that this Court “may decide
appeals in any matter”, but that it “is
the highest Court
of appeal except in constitutional matters” (s 168(3)): this
provision superseded both the statutory and
common-law sources of
this Court's jurisdiction, and there can be no reason to give it less
than its full meaning in relation to
both constitutional and
non-constitutional matters.
[11.3] The
Constitution's typology of final appellate Courts is exhaustive: it
does not envisage other final appeal Courts with
authority equivalent
to that of this Court and of the CC.
[11.4] This Court's
appellate powers do not derive from any particular statute, but from
the Constitution itself.
[11.5] The
Constitution does not envisage that legislation can assign the
jurisdiction of this Court piecemeal or wholesale to other
specialist
tribunals with final appellate jurisdiction.
[11.6]
The Legislature may create rights that are not appealable; but once
appellate jurisdiction falls to be exercised, this Court
is empowered
to exercise it finally (apart from the CC), since final appellate
tribunals with authority similar to this Court are
not envisaged in
the Constitution.’
[8]
In
American Natural Soda Ash
this court then proceeded to
explain that s 62 of the Act is governed by the same reasoning
as
s 183
of the
Labour Relations Act and
that in consequence
(para 14):
‘
The
apparent attempt to vest exclusive jurisdiction in the CAC . . . must
thus be read so as to be consistent with the Constitution,
and the
finality conferred on the CAC by s 62(3)(
a
)
is thus subordinate to the appellate powers the Constitution confers
on this Court. It follows that this Court has jurisdiction
to
consider the substance of the application for leave to appeal.’
[9]
However, as we now know, s 168(3) of the Constitution, which
formed the bedrock of both
Fry’s
Metals
and
American
Natural Soda Ash
,
was materially amended by s 4 of the
17
th
Constitution Amendment Act
.
After that amendment, it now reads:
‘
The
Supreme Court of Appeal may decide appeals in any matter arising from
the High Court of South Africa or a court of a status
similar to the
High Court of South Africa,
except in
respect of labour or competition matters to such extent as it may be
determined by an Act of Parliament
The
Supreme Court of Appeal may decide only-
(i) appeals;
(ii) issues
connected with appeals; and
(iii)
any other matter that may be referred to it in circumstances defined
by an Act of Parliament.’ (My emphasis.)
[10]
In
National Union of Public Service and
Allied Workers obo Mani & others v National Lottery Board
2014 (3) SA 544
(CC) (para 40, note 26), Froneman J held, albeit
obiter
,
that as a result of the 17
th
Constitution Amendment Act the right of appeal against a judgment of
the Labour Appeal Court to the Supreme Court of Appeal, no
longer
exists. Not only do I find myself in respectful agreement with this
conclusion, but I also believe that it is of direct
application in
this case. It is true that Froneman J was dealing with the
Labour
Relations Act and
that the wording of the relevant section of that
Act – s 183 – is quite different to s 62.
Nonetheless, I
do not believe that the difference impacts on the
principle that concerns us.
[11]
Soda Ash
,
drawing on
Fry’s Metals
,
held that s 168(3) of the Constitution superseded both the statutory
and common-law sources of this court’s jurisdiction
and that
this court derived its jurisdiction in respect of competition matters
from that provision. The effect of the amendment
is that this court
can no longer rely on that provision as the source of its
jurisdiction. This court’s jurisdiction must
accordingly be
sourced in the Act.
[12]
As I see it the judgment of the CAC under consideration falls within
the ambit of s 62(1)(
b
) in that it was given in the
exercise of its ‘functions’ referred to in s 37(1)(
b
)(ii)
of the Act. This court’s jurisdiction therefore turns on
whether the CAC’s decision to order the discovery and
production of documents pursuant to s 37(1)(
b
)(ii) can be
said to constitute a ‘matter referred to in s 62(2)’.
For the sake of convenience, I repeat the three
categories mentioned
in that sub-section:
(a) The question
whether an action taken or proposed to be taken by the Competition
Commission or the Competition Tribunal is within
their respective
jurisdictions in terms of this Act;
(b) Any
constitutional matter arising in terms of this Act; and
(c)
The question whether a matter falls within the exclusive jurisdiction
granted under sub-section (1).
[13]
In arguing that the decision of the CAC is covered by s 62(2),
the Commission did not place any reliance on s 62(2)(
c
).
It was clearly right in not doing so. It did, however, rely on
sections 62(2)(
a
)
and (
b
).
With regard to s 62(2)(
a
)
I accept, at least for the sake of argument, that the application for
the review of the Commission’s decision to refer –
which
is still to follow – would constitute a ‘question whether
action proposed to be taken by the Tribunal is within
its
jurisdiction in terms of the Act’. I say that because, if the
complaints were not properly referred by the Commission
in terms of
s 50(2), the Tribunal would have no jurisdiction to entertain
them. But the question is whether the interlocutory
application to
compel discovery and production of documents which precedes the
review application – as opposed to the review
application
itself – can also be brought home under s 62(2)(
a
).
I do not think so. It is true that the interlocutory application is
incidental to the review application – in the sense
that, but
for the latter, the former serves no purpose. Yet, that does not mean
that the two are the same, or that one can simply
conflate the two.
Because they are discrete proceedings which are to be determined
separately, considerations pertaining to the
one cannot willy-nilly
be transposed onto the other. The fundamental difference is that,
unlike the review application, the outcome
of the interlocutory
application can have no effect on the jurisdiction of the Tribunal.
Ergo it cannot be said to involve a question
concerning jurisdiction
as envisaged by s 62(2)(
a
).
[14]
With reference to s 62(2)(
b
)
the Commission’s argument as to why this is a ‘constitutional
matter’ relied first and foremost on the proposition
that
Computicket’s review application is based on the constitutional
principle of legality as recognised, for example, in
Affordable
Medicines Trust & others v Minister of Health & others
[2005] ZACC 3
;
2006
(3) SA 247
(CC) para 47. The premise of the argument that the review
application rests on the legality principle is undoubtedly correct.
Yet
the further progression of the Commission’s argument again
conflates the interlocutory application with the review application.
Once the two are distinguished, as they should be, it becomes clear
that while the latter relies on the legality principle the
former
does not.
[15]
The second string to the Commission’s constitutional bow was
that the right to discovery and production of documents
which
Computicket seeks to enforce in the interlocutory application
ultimately derives from the right to a fair hearing in terms
of s 34
of the Constitution. This, so the argument went, renders the
interlocutory application in itself a ‘constitutional
matter’.
Again, the premise of the argument cannot be faulted. After all, the
proposition had been confirmed in terms by
this court (see eg
Bridon
International GMBH v International Trade Administration Commission &
others
2013 (3) SA 197
(SCA) para 32). But I do not believe that
the concept of a ‘constitutional matter’ can be afforded
that wide meaning
in s 62(2)(
b
). I say that because in
that wide sense, most, if not all disputes can ultimately be traced
back to the Constitution. It would
for example, also include a rather
mundane application to compel further particulars. At the same time,
that would render the exclusive
jurisdiction of the CAC in certain
matters – which is the main theme of s 62 – illusory
(cf
S v Boesak
[2000] ZACC 25
;
2001 (1) SA 912
(CC) para 15). This means that
‘constitutional matters’ in s 62(2)(
b
) must
be afforded a narrower meaning. I find support for this approach in
the following statement by the Constitutional Court in
Fraser v
Absa Bank Ltd (National Director of Public Prosecutions as Amicus
Curiae)
[2006] ZACC 24
;
2007 (3) SA 484
(CC) at paras 36-40:
‘
.
. . Philosophically and conceptually it is difficult to conceive of
any legal issue that is not a constitutional matter within
a system
of constitutional supremacy. All law is after all subject to the
Constitution and law inconsistent with the Constitution
is invalid.
Nevertheless the jurisdiction of this Court is expressly restricted
to only those matters outlined in s 167(3)
(b).
.
. .
While the conception
of a constitutional matter is broad, the term is of course not
completely open. The fact that s 167(3)
(b)
of the Constitution
limits this Court's jurisdiction to constitutional matters
presupposes that a meaningful line must be drawn
between
constitutional and non-constitutional matters and it is the
responsibility of this Court to do so. . . .
A
contention that a lower Court reached an incorrect decision is not,
without more, a constitutional matter. Moreover, this Court
will not
assume jurisdiction over a non-constitutional matter only because an
application for leave to appeal is couched in constitutional
terms.
It is incumbent upon an applicant to demonstrate the existence of a
bona fide
constitutional question.’
[16]
Applying this narrower interpretation I do not believe that the
present matter falls within the ambit of ‘a constitutional
matter’. Computicket’s right to a fair hearing was never
in dispute. Nor was its right, in principle, to discovery
and
production of documents. Indeed, in this case the discovery process
had been completed. What Computicket essentially sought
and obtained
was an order for identification or specification of the documents –
presumably already discovered by the Commission
– that were
before the Commission when it took the referral decision which is the
subject of the review application. That,
as I see it, does not
involve a constitutional issue and therefore does not fall within the
ambit of a ‘constitutional matter’
as contemplated by
s 62(2)(
b
).
[17]
On that basis alone, I remain unpersuaded that this court would have
jurisdiction to hear the proposed appeal. But there is
more. On my
understanding of s 63(2) it reserves appeals on constitutional
matters exclusively for the jurisdiction of the
Constitutional Court.
What s 63(2) contemplates is ‘an appeal in terms of
s 62(4) . . .’. That is ‘an
appeal from a decision
of the Competition Appeal Court in respect of a matter within its
jurisdiction in terms of sub-section (2)’,
either to this court
or the Constitutional Court. Section 63(2) then provides that such an
appeal ‘may be brought to the
Supreme Court of Appeal or, if it
concerns a constitutional matter, to the Constitutional Court . . .
’. Literally understood
it leaves no room for an interpretation
which effectively adds an ‘also’ prior to ‘to the
Constitutional Court’,
ie that if an appeal concerns a
constitutional matter it may be brought to this court and
also
to the Constitutional Court. Moreover, on a purposive approach it
makes sense to me that a disgruntled litigant who seeks to appeal
from the decision of the CAC, is compelled to decide whether to
direct his or her appeal to this court or the Constitutional Court,
the dividing line being whether the matter is constitutional or not.
The underlying motivation would be that there is no reason
why a case
which had already gone through two courts deserves consideration by
two further courts. This means that even if the
present matter does
fall within the ambit of ‘constitutional’ as contemplated
by s 62(2)(
b
)
– which, in my view, it does not– the jurisdiction of
this court to hear the proposed appeal would in any event be
excluded
by s 63(2).
The
Merits
[18]
This is really the end of the matter. Yet, since I hold a firm view
that, in any event, the proposed appeal is devoid of merit,
I shall
state the reasons that led me to that conclusion. However, in the
circumstances I shall do so succinctly and without elaboration.
The
starting point, as I see it, is the concession by the Commission
that, although a referral decision in terms of s 50(2)
of the
Act does not constitute administrative action as envisaged by the
Promotion of Administrative Justice Act 3 of 2000
, it is nonetheless
reviewable on the basis of the legality principle. This concession
was rightly made in accordance with this
court’s decisions (eg
in
Competition Commission of South
Africa v Telkom SA Ltd & others
[2010]
2 All SA 433
(SCA) paras 11-12;
Competition
Commission v Yara (SA) (Pty) Ltd & others
2013
(6) SA 404
(SCA) para 26).
[19]
As a second step, the Commission also conceded that, since the
decision to refer is reviewable, Computicket is entitled, as
a matter
of principle, to discovery and production of the material that was
before the decision-maker when that decision was taken.
The
correctness of that concession appears, inter alia, from the
following statement by Navsa JA in
Democratic Alliance &
others v Acting National Director of Public Prosecutions & others
2012 (3) SA 486
(SCA) para 37:
‘
.
. . It can hardly be argued that, in an era of greater transparency,
accountability and access to information, a record of decision
related to the exercise of public power that can be reviewed should
not be made available, whether in terms of
rule 53
or by courts
exercising their inherent power to regulate their own process.
Without the record a court cannot perform its constitutionally
entrenched review function, with the result that a litigant's right
in terms of s 34 of the Constitution to have a justiciable
dispute decided in a fair public hearing before a court with all the
issues being ventilated, would be infringed . . ..’
(See
also
Bridon International GMBH v
International Trade Administration Commission & others
2013
(3) SA 197
(SCA) paras 31-32.)
[20]
At first sight one could be pardoned for thinking that, in the light
of these two concessions the Commission would have no
answer to
Computicket’s demand for the record which formed the basis of
the decision it seeks to challenge. Nonetheless,
the Commission
offered not only one, but two answers. Its first answer was that in
order to demand the record, Computicket had
to make out a
prima
facie
case for review. The only basis
relied upon for this contention was that Computicket bears the onus
of establishing its review grounds.
But as I see it, the basis relied
upon amounts to a
non sequitur
.
I agree with the CAC’s finding that this argument effectively
places the cart before the horse. Not infrequently the ability
of an
applicant for review to discharge the onus resting on it to make out
a case, will depend on considerations appearing –
or not
appearing – from the record of the material upon which the
challenged decision had been made. Moreover, upholding
the
Commission’s argument would give rise to a two stage enquiry on
the merits of the case: first, without the record to
determine
whether the applicant had made out a prima facie case. If the
applicant clears that hurdle, the second stage enquiry
then follows
to finally determine the merits, this time with the benefit of the
record which had now been made available. The proposed
scenario, for
which there appears to be no justification in logic, is clearly
unsustainable. Finally, the argument under consideration
is not
supported by Rule 53. In terms of this rule, the obligation to
produce the record automatically follows upon the launch
of the
application, however ill-founded that application may later turn out
to be.
[21]
For its second answer the Commission relied on the proposition that
its decision to refer the complaints is only a preliminary
step in a
continuing administrative process. Proceeding from this premise the
Commission argued that this preliminary step should,
as a general
rule, not be open to a challenge in review proceedings brought prior
to the hearing and determination of the complaint
proceedings by the
Tribunal. In consequence, so the argument went, Computicket had to
put up exceptional circumstances that would
justify the court
entertaining a review in the middle of an ongoing case. In support of
this argument the Commission sought to
rely on the well-established
principle that trial proceedings, be it criminal or civil, should
only be interrupted by way of a
midstream review where there are
compelling reasons to do so (see eg
Walhaus
& others v Additional Magistrate, Johannesburg & another
1959
(3) SA 113
(A) at 120A-B;
S v Mhlungu &
others
[1995] ZACC 4
;
1995 (3) SA 867
(CC) at para
58).
[22]
However, I find the argument fundamentally flawed. The flaw, as I see
it, lies in the premise that the decision to refer a
complaint is
part of an ongoing process. It is not. It is a discrete decision
which, in conformity with the Commission’s
concession –
rightly made – is, in itself, subject to a legality review.
Once that is appreciated, it follows that
in accordance with general
principles governing administrative reviews, these review proceedings
must commence within a reasonable
time after the challenged decision
had been communicated to the applicant so as to prevent someone
acting upon the supposed validity
of the challenged decision (see eg
Associated Institutions Pension Fund &
others v Van Zyl & others
2005 (2)
SA 302
(SCA) para 46). In this light I believe that were this court
to have had jurisdiction to enter into the merits of the appeal, the
matter is devoid of substance and the appeal ought on that score as
well to have failed.
[23]
For these reasons the application for leave to appeal is dismissed
with costs, including the costs of two counsel.
_________________
F
D J BRAND
JUDGE
OF APPEAL
APPEARANCES:
For
the Appellant: G J Marcus SC, J Wilson, P M P Ngcongo
Instructed by:
The State Attorney
Johannesburg
c/o N W Phalatsi &
Partners
Bloemfontein
For
the Respondent: J J Gauntlett SC, M J Engelbrecht
Instructed by:
Cliffe Dekker
Hofmeyr Inc
Cape Town
c/o Honey Attorneys
Bloemfontein