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[2019] ZAECPEHC 59
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Southern Ambition 201 CC v Minister of Police (704/2019) [2019] ZAECPEHC 59 (25 September 2019)
IN
THE HIGH COURT OF SOUTH AFRICA
(EASTERN
CAPE LOCAL DIVISION, PORT ELIZABETH)
Case
No: 704/2019
Date
heard: 29 August 2019
Date
delivered: 25 September 2019
In
the matter between:
SOUTHERN
AMBITION 201
CC Applicant
And
MINISTER
OF
POLICE
Respondent
JUDGMENT
Goosen
J:
[1]
The
applicant seeks return to it of a quantity of cigarettes seized by
members of the South African Police Services at its premises
on 17
October 2017. It founds its application upon the provisions of s 31
of the
Criminal
Procedure Act
(the
Act)
[1]
.
[2]
The applicant conducts business as a general trader in what it
describes
as “
fast-moving
consumer goods
”.
These goods include cigarettes. According to its founding affidavit
it purchases the cigarettes from suppliers in South
Africa in “
master
cases
” which typically comprise of 50 cartons of
cigarettes. The cigarettes are sold to persons and entities who are
retailers.
The applicant asserts that because of the nature of its
clientele a substantial portion of its receipts comprise cash. It
retains
the cash for a period before depositing the sum into its own
banking account or those of suppliers.
[3]
On 17
October 2017 members of the South African Police Services conducted a
search of the home of the sole member of the applicant
at 39 Alyssum
Road, Malabar, Port Elizabeth, in execution of a search warrant. The
lawfulness of the search and resultant seizure
of goods is not in
dispute. One thousand seven hundred and six (1706) master cases and
thirty (30) loose cartons of cigarettes,
of various brands were
seized. Also seized on this occasion was cash in an amount of
approximately R2.3 million and certain vehicles
[2]
.
[4]
On 28
November 2017 the National Director of Public Prosecutions obtained a
preservation order against the applicant in terms of
s 38(1) of the
Prevention
of Organized Crime Act
[3]
(
POCA
).
The order relates to cash and vehicles seized on 17 October and to
certain funds held in a bank account.
[5]
On 19
October 2017 Ashraf Laher, the sole member of the applicant, and his
brother Araf Laher appeared in the Magistrates’
Court on
multiple criminal charges
[4]
which include offences in terms of s 80(1)(a) of the
Customs
and Excise Act
[5]
;
s 7(3) of the
Tobacco
Products Control Act
[6]
;
fraud; forgery and uttering.
[6]
According to the applicant it is opposing the proceedings under
POCA
.
The present application was commenced on 19 March 2019. This followed
the removal of the criminal prosecution against the Laher
brothers
from the roll. It is common cause that the case against the Laher
brothers was struck from the roll because the prosecution
had failed
to furnish certain requested further particulars to the charge sheet.
It is also common cause that the accused have
not yet pleaded to the
charges.
[7]
The applicant’s case is founded upon the following essential
averments.
The applicant alleges that it is the owner of the goods
seized and that it was, at the time that they were seized, in lawful
possession
of the goods. It accordingly seeks to be restored to
possession of the goods. In the alternative it relies on s 31 of the
Act.
In this regard it avers that no criminal proceedings have been
instituted in connection with the seized goods and that the goods
are
not required for trial for the purpose of evidence. It is further
averred that the applicant may lawfully possess the goods.
[8]
In support of its claim to ownership of the goods, and also its
assertion
of lawful possession of the goods, the applicant relies
upon a number of invoices issued to it by Smokes Incorporated as
evidencing
delivery to it of quantities of various brands of
cigarettes. The allegation is made that these invoices, which refer
to brands
of cigarettes seized by the police, indicate that the
cigarettes were purchased by and therefore owned by the applicant.
The respondent
denies these allegations and further alleges that the
invoices are fabrications created to clothe the possession of the
goods with
legitimacy.
[9]
Reference was made in the papers, and in argument, to two invoices
relating
to transactions on 31 August 2016 and 31 September 2016. The
same invoice (No 883 dated 31 (
sic
) September 2016) is
attached. It was submitted however that this is a mere error and
duplication. Even accepting that this is so
there are several aspects
regarding the invoices which bear comment.
[10]
The first is that they are put up by the applicant as evidencing
ownership of the goods
seized. What is striking, however, is that the
applicant relies on two invoices dated 2014 and 2015 respectively; 5
invoices dated
2016 and 8 invoices dated in 2017. One of these is
dated 22 December 2017 (invoice 991) i.e. more than two months after
the goods,
which are the subject of this application, were seized.
[11]
It is also noteworthy that the deponent to the founding affidavit, no
doubt mindful of
the dates on the invoices, asserts that whereas the
applicant trades in “
fast-moving consumer goods
”,
in respect of some brands the retention time is long. Elsewhere in
the affidavit it is asserted that the application is
time-sensitive.
This is so, it is alleged, because the goods are perishable and that
both the tobacco and the paper used “
have a limited
lifespan
”.
[12]
The long retention period of stock is specifically denied by the
respondent. Vermaak, who
deposes to the affidavit, states that the
computer records obtained from the applicant’s premises
indicate a high volume
and rapid turnover of stock. It is therefore
denied that the invoices presented by the applicant relate to the
goods seized. The
deponent to the founding affidavit himself
acknowledges that there is no nexus between the invoices and the
goods seized when he
states:
“
I have attempted
to obtain invoices to evidence the purchase of the items. I have
simply sought to attach sufficient invoices to
evidence the purchase
of the quantity of stock seized.”
[13]
There is, however, a more fundamental difficulty with the invoices.
They can at best evidence
delivery of a supply of cigarettes by
Smokes Incorporated to the applicant indicating the amount payable.
The applicant makes no
allegation that it has paid the amounts
reflected in the invoices. All that it advances is a letter, not
confirmed by affidavit,
purportedly written by Mu-Aiaz Ismail who is
apparently a director of Oraculan 75 CC t/a Smokes Incorporated
dated 6 March
2019. The letter states that “
ownership
of various cigarettes [of which it is the supplier] is vested in
Southern Ambition 201 CC t/a Cellular Finatex as soon
as delivery of
the cigarettes have been made per the various invoices
”.
[14]
This letter has no evidential value whatsoever. It, in any event,
says nothing about Smokes
Incorporated’s right to transfer
ownership. This is all the more noteworthy given the content of the
applicant’s attorney’s
letter of demand dispatched to the
respondent prior to launching this application. In that letter the
attorney states the following:
“
5.
The affected goods comprises cigarettes purchased by our client from
Smokes Inc which in turn purchased
the cigarettes from Carnilinx
(Pty) Ltd.
6.
Our client is the owner of the affected goods. The police are with
respect in unlawful possession
of the affected goods.”
[15]
Then, in contending for some urgency in the matter, the following is
stated:
“
12.
Our client is under pressure to pay the seller for the products. The
seller Smokes Inc is under pressure to pay
the manufacturer Carnilinx
(Pty) Ltd.”
[16]
Apart from
the assertion of ownership of the goods which the respondent denies,
the applicant does not present any acceptable or
admissible evidence
to support the claim. Nor does the factual presumption of ownership
arising from the applicant’s possession
of the goods arise,
since the lawfulness of the applicant’s possession is put in
issue. In
Concor
Construction (Cape) (Pty) Ltd v Santambank Ltd
[7]
:
“
The
derivative mode of acquisition of ownership on which the plaintiff
relies is delivery. The requirements for the passing
of
ownership by delivery include,
inter
alia
,
(a)
that
the transferor must be capable of transferring
ownership;
(b)
delivery
must be effected by the transferor with the intention of transferring
ownership and taken by the transferee with
the intention of accepting
ownership; and
(c)
payment
where the sale is a cash sale. Joubert (ed)
The
Law of South Africa
vol
27 para 165. In
Lendalease
Finance (Pty) Ltd v Corporacion de Mercadeo Agricola and
Others
1976
(4) SA 464 (A)
at
489H it was held that
'.
. . ownership cannot pass by virtue of the contract of sale alone:
there must, in addition, be at least a proper delivery to
the
purchaser of the contract goods . . .'
and
at 490A that
'.
. . under a cash sale ownership is normally taken to have been
intended to pass once there has been, in addition to delivery,
due
payment of the purchase price . . .'.
In
Trust
Bank van Afrika Bpk v Western Bank Bpk en Andere NNO
1978
(4) SA 281 (A)
at
301H-302A it was held that:
'Volgens
ons reg gaan die eiendomsreg op 'n roerende saak op 'n ander oor waar
die eienaar daarvan dit aan 'n ander lewer, met die
bedoeling om
eiendomsreg aan hom oor te dra, en die ander die saak neem met die
bedoeling om eiendomsreg daarvan te verkry. Die
geldigheid van die
eiendomsoordrag staan los van die geldigheid van enige
onderliggende kontrak.'”
Such
evidential material as is presented suggests that goods, albeit not
necessarily the seized goods, were purchased by the applicant
from
Smokes Incorporated. In this instance there is no allegation made as
to the terms of the sale agreement and accordingly no
basis to infer
that by mere delivery of the goods, ownership vested in the
applicant.
[17]
The applicant bears the onus to establish its ownership of the goods.
I am not satisfied
that it has discharged the onus. Even if I am
wrong in this and it is to be accepted that the first element of the
rei vindicatio
is established, the application must fail on
the basis that the respondent’s possession of the goods is
authorised by statute.
In this instance the respondent alleges that
it lawfully seized the goods, in terms of s 20 of the Act, and
retains possession
pursuant to s 31. It is to this alternative basis
for the relief that I now turn. Section 20 of the Act provides as
follows:
“
20
State
may seize certain articles
The
State may, in accordance with the provisions of this Chapter, seize
anything (in this Chapter referred to as an article)-
(a)
which
is concerned in or is on reasonable grounds believed to
be
concerned in the commission or suspected
commission of an offence, whether
within the Republic or
elsewhere;
(b)
which may afford evidence of the commission or suspected
commission
of an offence, whether within the
Republic or elsewhere; or
(c)
which is intended to be used or is on reasonable grounds believed
to be intended to be used
in the commission of an offence.”
[18]
I have already indicated that the lawfulness of the seizure of the
goods on 17 October
2017 is not in issue. The applicant relies for
the unlawfulness of the respondent’s retention of the goods
upon s 31 of the
Act. Section 31 provides that:
“
31
Disposal of article where no criminal proceedings are instituted or
where it is not required for criminal proceedings
(1)(a) If no criminal
proceedings are instituted in connection with any article referred to
in section 30 (c) or if it appears that
such article is not required
at the trial for purposes of evidence or for purposes of an order of
court, the article shall be returned
to the person from whom it was
seized, if such person may lawfully possess such article, or, if such
person may not lawfully possess
such article, to the person who may
lawfully possess it.
(b) If no person may
lawfully possess such article or if the police official charged with
the investigation reasonably does not
know of any person who may
lawfully possess such article, the article shall be forfeited to the
State.
(2) The person who may
lawfully possess the article in question shall be notified by
registered post at his last-known address that
he may take possession
of the article and if such person fails to take delivery of the
article within thirty days from the date
of such notification, the
article shall be forfeited to the State.”
[19]
In
Ntoyakhe
v Minister of Safety and Security and Others
[8]
it was held:
“
The provisions of
s 20, read with s 31, indicate that the main objective of the seizure
authorised in chap 2 is to enable the police
to obtain possession of
articles for the purpose of investigating crimes and prosecuting
suspected offenders. The chap 2 provisions
however do not confer on
the State the right to deprive a person of the lawful possession of
an article indefinitely. Considerations
of fairness and
reasonableness which underlie our criminal justice system, dictate
that the criminal proceedings contemplated in
s 31 shall be
instituted within a reasonable time. What constitutes a reasonable
period will of course depend on the facts of each
case. In such
regard it seems to me, furthermore, that on general principles the
police are required to place facts and circumstances
before the court
on which the reasonableness of the further detention shall be
adjudged.”
[20]
In
National
Director of Public Prosecutions v Five Star Import & Export (Pty)
Ltd
[9]
it was stated that:
“
[45] It is clear
that s 31(1)(a) calls for two enquiries. The first is for an
applicant to show on a balance of probabilities that
no criminal
proceedings have been instituted and that there is no reasonable
likelihood of such proceedings in the foreseeable
future, as
contemplated in s 31(1)(a): 'If no criminal proceedings are
instituted . . .'. If this former onus is discharged, then
the second
enquiry is whether the police can prove on a balance of probabilities
that an applicant may not lawfully possess the
article seized. In
this regard see Dookie supra at 156 – 157.
[21]
The first inquiry is therefore whether criminal proceedings have been
instituted and that
there is no reasonable likelihood of such
proceedings in the foreseeable future. Only if this is established
does the second inquiry
arise.
[22]
As
indicated at the outset it is common cause that the Laher brothers
have been charged with a number of offences. Accordingly,
there can
be no dispute that criminal proceedings have been instituted. The
authority to institute criminal proceedings vests in
the Director of
Public Prosecutions
[10]
. It is
plain that that authority has been exercised. It is also plain that
the proceedings have commenced. Although the applicant’s
papers
suggest that the striking of the matter off the roll means that no
criminal proceedings are pending, that cannot be so.
The fact that
the trial has not commenced and that the matter has been removed from
the roll does not mean that the prosecution
has been withdrawn or
that it is stayed.
[23]
The only question, therefore, is whether the criminal proceedings are
“
in connection
” with the seized items or that the
items are not required at trial for the purpose of evidence.
[24]
In this regard it was submitted that the charge sheet specifies
particular goods in relation
to several charges. These specified
goods concern transactions allegedly entered into in contravention of
s 80 of the
Customs and Excise Act
and s 7(3) of the
Tobacco
Products Control Act
. It is further alleged that the seized goods
are not particularized and that they are not identified in the charge
sheet.
[25]
Whilst it
is indeed so that several charges refer to specific goods being the
subject of those charges, there are, in the charge
sheet as presently
framed, a number of charges which refer to the alleged possession of
illicit goods, namely cigarettes on which
no excise duties/taxes were
paid
[11]
.
[26]
In my view, the common cause facts establish that a criminal
proceeding, inter alia, concerning
the seized goods has indeed been
instituted. The further question is whether it has been established
by the applicant, that there
is no reasonable prospect of the
criminal proceedings being pursued. In this regard the applicant
relies on the fact that there
has been a delay of 17 months since
commencement of the proceedings. It also relies on the fact that the
matter has been struck
off the roll.
[27]
This latter fact is explained on the basis that the requested further
particulars to the
charge sheet were not produced. I have already
indicated that the striking off does not amount to a withdrawal or
stay. There can
no doubt that principles of fairness in criminal
proceedings require that such proceedings be finalized expeditiously.
Where there
is a delay which prejudices the rights of the accused or
potentially prejudices those of an affected third party remedies are
available.
The proper course is to seek such remedies.
[28]
I am unable to conclude merely on the basis that the matter was
removed from the roll,
and without hearing the prosecuting authority
that there is no reasonable prospect of the criminal proceedings
continuing. It follows
that I am not satisfied that the applicant has
discharged the onus which rests upon it in the first stage of an
inquiry in terms
of s 31(1)(a). It is accordingly not necessary to
reach the question whether the applicant is lawfully entitled to
possess the
seized goods.
[29]
In the result I make the following order:
The
application is dismissed with costs.
________________________
G.G.
GOOSEN
JUDGE
OF THE HIGH COURT
Obo
the Applicant:
Adv M. Beneke
Instructed
by
Bashier Moosa Attorneys c/o Danie Gouws Attorneys, 136 Cape Road,
Mill Park, Port Elizabeth
Tel: (041) 922 5245
Obo
the Respondent: Adv
H. Bakker
Instructed
by State
Attorney, 29 Western Road, Central, Port Elizabeth
Tel:
(041) 585 7921
[1]
Act No, 51 of 1977
[2]
It appears that an amount of R2 242 810,00 was seized
under a Gelvandale CAS number and an amount of R58 477,70
was
seized under a Uitenhage CAS number.
[3]
Act No, 121 of 1998
[4]
The charge sheet list 15 counts.
[5]
Act No, 91 of 1964
[6]
Act No, 83 of 1993
[7]
1993 (3) SA 930
(A) at 933B-E
[8]
1999 (2) SACR 349
(E) at 355h-356a
[9]
2018 (2) SACR 513
(WC) at par 45
[10]
S 179(2) of the Constitution read with
s 20(1)
of the
National
Prosecuting Authority Act, 32 of 1998
.
[11]
Counts 5, 8, 9, 12, 15 and 16.