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[2012] ZASCA 49
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Finishing Touch 163 (Pty) Ltd v BHP Billiton Energy Coal South Africa Ltd and Others (363/2011) [2012] ZASCA 49; 2013 (2) SA 204 (SCA) (30 March 2012)
Links to summary
THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Case No: 363/2011
REPORTABLE
In the matter between
FINISHING TOUCH 163 (PTY) LTD
.........................................................................
Appellant
and
BHP BILLITON ENERGY COAL
SOUTH
AFRICA LIMITED
.........................................................................................
First
Respondent
THE MINISTER OF MINERAL
RESOURCES OF THE REPUBLIC OF
SOUTH AFRICA
.........................................................................................
Second
Respondent
THE DIRECTOR GENERAL OF THE
DEPARTMENT OF MINERAL
RESOURCES
.............................................
Third
Respondent
THE DEPUTY DIRECTOR GENERAL
OF
THE DEPARTMENT OF MINERAL
RESOURCES
........................................................................................................
Fourth
Respondent
THE REGIONAL MANAGER:
MPUMALANGA REGION, DEPARTMENT
OF MINERAL RESOURCES
.................................................................................
Fifth
Respondent
Neutral citation:
Finishing Touch 163 (Pty) Ltd v BHP
Billiton Energy Coal South Africa Ltd
(363/11)
[2012]
ZASCA 49
(30 March 2012)
Coram:
MPATI P, MHLANTLA,
BOSIELO, MAJIEDT JJA and PLASKET AJA
Heard:
7 March 2012
Delivered:
30 March 2012
Summary
:
Practice – Interpretation of court order – when
application is initiated – whether interdict had lapsed.
___________________________________________________________
ORDER
___________________________________________________________
On appeal from:
North Gauteng High Court,
Pretoria (Van der Byl AJ sitting as court of first instance).
The appeal is dismissed with costs including those
attendant on the employment of two counsel.
___________________________________________________________
JUDGMENT
___________________________________________________________
MHLANTLA JA (MPATI P, BOSIELO, MAJIEDT JJA and
PLASKET AJA concurring):
[1] This appeal, which is before us with the leave of
the court below, turns on the interpretation of a court order. The
appeal
necessitates a consideration of three orders of the North
Gauteng High Court, Pretoria. In the first, under case no 35324/2005,
Preller J had granted an interim interdict. The second order, under
case no 2306/2006, had been granted by Van der Merwe J pursuant
to a
review application. The third relates to an urgent application which
was heard by Van der Byl AJ. This appeal is directed
against his
order in terms of which certain relief sought by the appellant,
Finishing Touch (Pty) Ltd (Finishing Touch), was dismissed
with
costs.
[2] The issues that arose for determination will be best
understood against the background that follows. The genesis of the
litigation
concerns a dispute about the true ownership of a mining
right. The first respondent, BHP Billiton Energy Coal SA Ltd (BHP),
formerly
known as Ingwe Collieries Limited, was the holder of an
unused old order mining right in respect of certain properties. There
was
a pending application by BHP for a prospecting permit in terms of
the Minerals Act 50 of 1991 when the Mineral and Petroleum Resources
Development Act 28 of 2002 (the Act) came into operation on 1 May
2004.
[3] BHP was, in terms of Item 3 of Schedule II of the
Act, deemed to have applied for a prospecting right and was obliged
to apply
for the conversion of the old order mining right into a new
order mining right. It submitted the outstanding information in order
for its application for a prospecting permit to be processed under
the Act. On 12 September 2005, BHP was informed that its application
had been refused on the grounds that the granting thereof would
result in an exclusionary act, prevent fair competition or result
in
the concentration of the mineral resources in question under the
control of BHP.
[4] On 3 November 2005, BHP instituted interdict
proceedings in the high court where it sought an order preventing the
Minister
of Mineral Resources and the relevant officials in her
department from granting any prospecting rights to a third party,
pending
the finalisation of review proceedings for the setting aside
of the decision to refuse its application for prospecting rights to
be launched by it. On 9 November 2005, the State Attorney, acting on
behalf of the Minister, the Deputy Director-General (DDG)
and the
Regional Manager (the State respondents) served a notice to abide the
court's decision. On 10 November 2005, Preller J
granted the
interdict against the State respondents.
[5] The order inter alia stated the following:
'2 The interdict set out in 1 above shall serve as a temporary
interdict pending the final determination of review proceedings
to be
launched by the applicant against the respondents, seeking the review
and setting aside of the decision in terms of section
17 of the Act
by the first and/or second respondents to refuse the applicant's
application lodged on 28 October 2004 for a prospecting
right for
coal in respect of the properties, on condition that such review
proceedings shall be
initiated
by no later than Wednesday, 25
January 2006.'
(My emphasis.)
For convenience I shall hereafter refer to this order as
the Preller J order.
[6] On 25 January 2006, BHP’s attorneys caused the
review application papers to be served by hand upon the State
Attorney
after receiving confirmation that they were still acting on
behalf of the first, third and fourth respondents. These documents
were served by the sheriff on the second and third respondents on 26
January 2006. The State respondents subsequently filed a notice
of
opposition but did not file any answering affidavits. This
application was heard by Van der Merwe J. On 3 October 2006, the
learned judge granted an order reviewing and setting aside the
refusal of BHP's application for prospecting rights and granted
it
himself.
[7] Almost four years later, in September 2010, BHP
discovered that two prospecting rights had, on 19 and 22 September
2006 respectively,
been granted to Finishing Touch despite the terms
of the Preller J order expressly interdicting the State respondents
from doing
so. The prospecting rights were over properties which
overlapped to a great extent with the properties on which BHP had
been granted
the prospecting rights. As a result, BHP launched an
internal appeal. It also sought an undertaking from Finishing Touch
not to
commence prospecting activities, nor to apply for mining
rights pending the finalisation of the internal appeal and
proceedings
to review the decisions of 19 and 22 September 2006 to
grant prospecting rights to Finishing Touch. Finishing Touch did not
furnish
such undertakings.
[8] To preserve the status quo, BHP instituted an urgent
application in the court below for an order interdicting Finishing
Touch
from applying for mining rights pending the finalisation of the
internal appeal and/or review proceedings. The State respondents
elected not to oppose the application, but Finishing Touch opposed it
on the following grounds:
(a) that the review proceedings envisaged in the Preller
J order were not initiated on 25 January 2006 as ordered, in that the
application
papers were only served on the third and fourth
respondents on 26 January 2006. Furthermore, that the papers were not
served on
the State respondents in that they were only served by hand
on the State Attorney who had represented them in a separate matter.
Consequently there was no proper service in terms of the Uniform rule
4(1)(
a
) and that the
interim interdict had lapsed; and
(b) that BHP was, in terms of the provisions of s 96(3)
of the Act,
1
not entitled to the order granted on 3 October 2006 (the
Van der Merwe J order) as it had not exhausted the internal remedies
provided
for in that section.
[9] Finishing Touch furthermore filed a
counter-application in terms of which it inter alia sought an order
in the following terms:
(a) consolidating the application and an application
launched by the applicant (BHP) against the State respondents under
case no
2306/2006 (prayer 2);
(b) declaring that no prospecting rights were awarded to
BHP on 3 October 2006 (prayer 3);
(c) rescinding and setting aside the Van der Merwe J
order granted on 3 October 2006 (prayer 4); and
(d) declaring that Finishing Touch was the legal holder
of the prospecting rights awarded to it on 19 September 2006 (prayer
5).
[10] The matter came before Van der Byl AJ in the court
below. The question that arose for determination was whether BHP had
initiated
the review proceedings by 25 January 2006. Counsel for BHP
submitted that the application had been initiated upon its issue by
the office of the registrar. The primary argument on behalf of
Finishing Touch rested on the proposition that an application could
only be initiated when it was properly served by the sheriff as
envisaged in Uniform rule 4.
[11] Van der Byl AJ reasoned that the lodging, filing
and the issue of application documents by the office of the registrar
had
to be regarded as the initiation of the proceedings envisaged in
the Preller J order. He held that the service of such process was
a
further step to get the respondent involved in the litigation. Van
der Byl AJ further held that the interdict proceedings were
incidental to the review proceedings and that BHP's attorneys were,
by virtue of the provisions of Uniform rule 4(1)(
a
A), entitled
to serve the review proceedings on the State Attorney, who had been
on record in the interdict proceedings and who
had, upon enquiry from
BHP's attorneys, confirmed that they were still on record and that
they would accept service on behalf of
the State respondents. He
accordingly granted an interim interdict.
[12] Regarding the counter-application, Van der Byl AJ
held that BHP had not exhausted the internal remedies prior to the
institution
of the review proceedings and that since Finishing Touch
had an interest in the relief claimed, it ought to have been afforded
an opportunity to advance its defence during the review proceedings.
Van der Byl AJ accordingly rescinded the Van der Merwe J judgment.
He
dismissed prayers 3 and 5 of the counter-application. It is against
the aforesaid findings and conclusions that Finishing Touch
presently
appeals, with the leave of the court below.
[13] As indicated earlier in the judgment, the
determination of this appeal depends on the proper interpretation of
the Preller
J order. The starting point is to determine the manifest
purpose of the order. In interpreting a judgment or order, the
court's
intention is to be ascertained primarily from the language of
the judgment or order in accordance with the usual well-known rules
relating to the interpretation of documents. As in the case of a
document, the judgment or order and the court's reasons for giving
it
must be read as a whole in order to ascertain its intention. See
Firestone South Africa (Pty) Ltd v Genticuro
AG
1977 (4) SA 298
(A).
2
[14] It is necessary to place the Preller J order in
proper perspective and to examine its terms and purpose in order to
determine
the intention of the learned judge when he used the word
‘
initiate’
.
In so doing one has to consider the context in which the order was
made. It is not in dispute that there were two competing rights
that
required to be settled without delay, viz, BHP's entitlement to a
prospecting permit on the one hand and Finishing Touch's
prospecting
rights granted on 19 and 22 September 2006, on the other. It was
imperative that the dispute be resolved. The question
to be answered
therefore is: What did Preller J mean when he ordered BHP to
initiate
the review proceedings by 25 January 2006?
[15] In this court, the finding of the court below was
assailed by counsel on behalf of Finishing Touch on two grounds.
First, it
was contended that the Preller J order meant that the
review application had to be served on the State respondents by the
sheriff
and filed or lodged with the registrar by 25 January 2006 as
both these acts were necessary to initiate the proceedings. Counsel
asserted that service of the application papers imbued an application
with legal effect. Second, counsel submitted that there was
no proper
service in terms of the Uniform Rules of Court by the end of the day
on 25 January 2006. In support of this submission
counsel called into
aid the following judgments, namely,
Republikeinse
Publikasies (Edms) Bpk v Afrikaanse Pers Publikasies (Edms) Bpk
;
3
Mame Enterprises (Pty) Ltd v Publications Control
Board
4
and
Tladi v Guardian National
Insurance Co Ltd.
5
Counsel contended that the court below should have
dismissed the application and granted the declaratory order sought by
Finishing
Touch.
[16] The submission advanced on behalf of BHP was that
the application had been initiated on 25 January 2006 when it was
lodged
and issued by the office of the registrar and that service of
the process was merely a second step in the proceedings. Counsel
further contended that there was proper service albeit the
application had been served by hand on the State respondents’
legal representatives. He thus supported the conclusions of the court
a quo.
[17] In my judgment, the argument on behalf of BHP
cannot be sustained. The interpretation favoured by it will give rise
to absurd
consequences and could never reflect Preller J's intention.
In
Republikeinse Publikasies (Edms) Bpk v
Afrikaanse Pers Publikasies (Edms) Bpk,
6
Rumpff JA held:
'
Hoewel `n dagvaarding eers deur die griffier
uitgereik word voordat dit beteken word (Reël 17 (1) en (3)),
word dit nie in
die Reëls vereis dat `n kennisgewing van mosie
deur die griffier uitgereik moet word of by hom ingelewer moet word
voordat
dit aan die respondent beteken kan word nie… Die doel
van `n dagvaarding en kennisgewing van mosie is natuurlik om die
verweerder
of respondent by `n geding te betrek, en wat hom betref,
word hy eers dan betrek wanneer `n betekening van die dagvaarding of
kennisgewing
van mosie plaasgevind het.'
7
[18] There can be no doubt that Preller J intended that
the review should effectively proceed by 25 January 2006. He could
never
have intended for BHP to have an application issued and a case
number allocated by the registrar and thereafter remain supine.
[19] In my view the Preller J order falls squarely
within the ambit of the cases to which we were referred by counsel
for Finishing
Touch. These cases were concerned with statutory
provisions or regulations which require that an application had to be
made within
a specified period. I shall mention only two of them. In
Mame Enterprises v Publications Control
Board,
8
Nicholas J held that it was manifest from Uniform rule
6
9
and from the contents of Form 2(a) that the giving of
notice to the respondent in a case where relief is claimed against
him is
an essential first step in an application on notice of motion.
In
Tladi v Guardian National Insurance Co
Ltd,
10
the court had to determine whether an application had
been made within a period of 90 days as contemplated in s 14(3) of
the Motor
Vehicle Accidents Act 84 of 1986. Botha J held that the
application could not be considered to have been made if it had
merely
been issued but not served.
[20] It follows in my view, that in ordering that the
review proceedings 'shall be initiated by no later than Wednesday, 25
January
2006' Preller J intended that notice of the application be
given to the registrar and the application served on the affected
parties
by 25 January 2006. Accordingly the finding of the court
below that the filing of the application papers with the registrar
and
the issue thereof must be regarded as the initiating of
proceedings cannot be sustained.
[21] But that is not the end of the enquiry. The next
issue is whether the review application was properly served in terms
of the
Uniform Rules of Court. Rule 4 sets out the manner in which
any process of the court should be served. Rule 4(1)(
a
)
provides:
'(1)(
a
) Service of any process of the court directed to the
sheriff and subject to the provisions of paragraph (
aA
) any
document initiating application proceedings shall be effected by the
sheriff in one or other of the following manners:
…
'
It is to that issue that I now turn.
[22] It is common cause that the review application was
not served by the sheriff on 25 January 2006 on any of the State
respondents.
It was only served by hand on the State Attorney
representing them. In this regard BHP relied on the provisions of
rule 4(1)(
aA
) which
provide:
'(
aA
) Where the person to be served with any document
initiating application proceedings is already represented by an
attorney of record,
such document may be served upon such attorney by
the party initiating such proceedings.'
[23] Counsel for Finishing Touch submitted that the
application for an interdict before Preller J was not linked to the
review proceedings
and that there was no basis for the attorneys of
BHP to serve the documents on the State Attorney as they were not
attorneys of
record for purposes of service in respect of the review
application. He contended that the service by hand on 25 January 2006
did
not constitute proper service in terms of rule 4 and consequently
the interdict had lapsed.
[24] In my view, this argument has no merit. It has to
be borne in mind that the interdict sought and obtained by BHP was
meant
to ensure that the prospecting rights for which it had applied
were not awarded to anyone else pending the final determination of
the review. The proceedings relating to the application for an
interdict and the review were thus intimately linked. They related
to
the same prospecting rights in issue and the same parties.
[25] It is not in dispute that BHP's attorney, Mr Band,
telephoned Mr Mathebula, of the office of the State Attorney and
enquired
whether they were still acting for the State respondents. Mr
Mathebula confirmed that his office still represented the said
respondents
and that it was authorised to accept service on behalf of
all the respondents of the review proceedings to be initiated in
terms
of the Preller J order. This was confirmed in writing by BHP’s
attorneys.
[26] Counsel for Finishing Touch urged us to reject this
explanation as it had been raised for the first time in the replying
affidavit.
It is true that the explanation was proffered by BHP in
reply, but the rule that all the necessary allegations upon which the
applicant
relies must appear in his or her founding affidavit is not
an absolute one. The court has a discretion to allow new matter in a
replying affidavit in exceptional circumstances. A distinction must
be drawn between a case in which the new material is first
brought to
light by the applicant who knew of it at the time when his founding
affidavit was prepared and one in which facts alleged
in the
respondents’ answering affidavit reveal the existence or
possible existence of a further ground for the relief sought
by the
applicant. See
Shakot Investments (Pty) Ltd v
Town Council of the Borough of Stanger.
11
[27] In this matter BHP was justified in dealing with
the issue in the replying affidavit as the question of service was
raised
in the answering affidavit as well as in the
counter-application on behalf of Finishing Touch. Before then it
could have had no
idea that the validity of the service by hand on
the State Attorney would be challenged, especially when the State
Attorney had
given the assurance that they had been authorised to
accept service on behalf of the State respondents. Furthermore this
aspect
was never challenged by the State respondents during the
review proceedings. The State Attorney simply filed a notice of
opposition
on their behalf but they elected not to file any answering
papers in the review application. I also cannot comprehend how the
State
respondents' waiver of compliance, even if there was any
non-compliance with the rule relating to service, could avail
Finishing
Touch who could never have been prejudiced by it.
[28] The arguments advanced on behalf of BHP with regard
to service of the review application are sound. It is evident that
the
State Attorney's office was acting as attorneys of record in
respect of the whole matter. The fact that each application had been
allocated a different case number is, in my view, irrelevant. The
purpose of all the proceedings was to determine the identity
of the
legal holder of the prospecting rights. The litigation was continuous
and one has to have regard to its history over time.
The same parties
were involved on broadly the same issues. And, as I have mentioned,
the remedy may have differed from one case
to the next but the
subject matter was the same.
[29] In the result the conclusion of Van der Byl AJ with
regard to service of process by hand cannot be faulted. In my view,
there
was proper service of the review application by 25 January
2006. This conclusion is dispositive of the appeal and renders it
unnecessary
to consider the relief sought by Finishing Touch.
[30] The appeal is dismissed with costs including those
attendant on the employment of two counsel.
________________
N Z MHLANTLA
JUDGE OF APPEAL
APPEARANCES
For Appellant: CE Puckrin SC (with him APJ Els and E
Muller)
Instructed by:
Thomas & Swanepoel, Pretoria
Symington & De Kok, Bloemfontein
For First Respondent: GL Grobler SC (with him JL
Gildenhuys)
Instructed by:
Mervyn Taback Inc, Pretoria
McIntyre & Van der Post, Bloemfontein
1
Section
96(3) of the Act provides:
'No
person may apply to the court for the review of an administrative
decision contemplated in subsection (1) until that person
has
exhausted his or her remedies in terms of that subsection.'
2
A
pplied
in
Administrator, Cape v Ntshwaqela
1990 (1) SA 705
(A) at 715F-H.
3
Republikeinse
Publikasies (Edms) Bpk v Afrikaanse Pers Publikasies (Edms)
Bpk
1972 (1) SA
773
(A) at 780.
4
Mame
Enterprises (Pty) Ltd v Publications Control Board
1974
(4) SA 271
(W) at 220B.
5
Tladi
v Guardian National Insurance Co Ltd
1992
(1) SA 76
(T) at 80B.
6
At
780D-F.
7
Although
a summons must first be issued by the registrar before it is served
(Rule 17(1) and (3)) it is not required by the Rules
that a notice
of motion should be issued by the registrar or be handed in to him
before it may be served on the respondent…The
object of a
summons or notice of motion is of course to make the defendant or
respondent party to the proceedings, and as far
as is concerned he
only becomes a party when service of summons or notice of motion
takes place. (My translation.)
8
At
220B.
9
Rule
6 deals with applications and provides:
'(1)
Save where proceedings by way of petition are prescribed by law,
every application shall be brought on notice of motion supported
by
an affidavit as to the facts upon which the applicant relies for
relief.
(2)
When relief is claimed against any person, or where it is necessary
or proper to give any person notice of such application,
the notice
of motion shall be addressed to both the registrar and such person,
otherwise it shall be addressed to the registrar
only.'
10
At
80B.
11
Shakot
Investments (Pty) Ltd v Town Council of the Borough of Stanger
1976 (2) SA 701
(D) at 705A-B. See also
Shepherd v Mitchell Cotts
Seafreight (SA) (Pty) Ltd
1984 (3) SA 202
(T) at 205E-G.