IN THE HIGH COURT OF SOUTH AFRICA
(WESTERN CAPE DIVISION, CAPE TOWN)
In the ma tter between:
PUFFIN FISHING CC
RIVER QUEEN TRADING 499 CC
and
MINISTER OF FORESTRY , FISHERIES
AND THE ENVIRONMENT
DEPUTY DIRECTOR-GENERAL: FISHERIES
MANAGEMENT BRANCH
ADVOCATE RADIA RAZACK N.O.
AND THE 4th TO 135th RESPONDENTS LISTED
IN ANNEXURE A TO THE FOUNDING AFFIDAVIT
Coram : Justice J C loete
C ase N o: 11413/2023
First Ap plicant
Seco~d Applicant
First R espondent
Second Responden t
Th ird Res pondent
Heard: 12 February 2024, supplem entary notes delivered on 14 and 19 February
2024
Delivered electronically: 11 M arch 2024
JUDGMENT
2
CLOETE J:
Introduction
[1] The applicants ("Puffin" and "River Queen " respectively) are close corporations
which conduct business in the tuna pole fishing industry. On 12 July 2023 they
launched this application in two parts. In Part A they sought certain interim relief
pending the determination of Part B. The Part A relief was ultimately not
pursued and Part B came before me .
[2] In their revised Part B they seek the review and setting aside of certain
decisions taken by the third respondent delegated authority ("DA") and
subsequently by the first respondent ("Minister") pursuant to their internal
appeals, together with substitution relief. The application is opposed by the
Minister, second respondent and DA The other respondents are right holders
in the same industry. No relief is sought against them since according to Puffin
and River Queen the orders sought do not impact on any of their fishing rights
or the number of crew they are presently allocated. They are thus cited merely
as potentially interested parties and they have not participated in these
proceedings.
Relevant factual background
[3] On 28 January 2022 Puffin and River Queen each applied for commercial t na
pole fishing rights for the period 1 March 2022 until 28 February 2037 in te ms
of s 18 of the Marine Living Resources Act ("MLRA ")1 in response to an
1 N o 18 of 1998.
3
invitation by the Minister issued in Government Gazette 45504 of 19 November
2021. Both Puffin and River Queen were Category A applicants (i.e. one who
held rights in the fishery during the period 2006 to 2020 for which it was re
applying, apparently extended until 31 December 2021 and thereafter until
31 March 2022).
[4] On 28 March 2022 Puffin was notified by the DA that its application was
unsuccessful since it scored below the available effort allocated to Category A
applicants. "Available effort" means the required measure of fishing intensity
based on historic performance. The DA also provided a score_sheet in which
she commented separately (i.e. without reference to any scoring) that '[t]here
is a brother sister relationship between the applicant and another Category C
applicant, Hotline Fishing CC ["Hotline"]. In accordance with the General Policy,
a right may be granted to only one such applicant. Hotline Fishing CC scored
higher and was granted the right'.
[5] On 5 April 2022 Puffin lodged an internal appeal with the Minister in terms of
s 80 of the MLRA. The Minister agreed with Puffin that it was erroneously
scored, but determined that the appeal should nonetheless fail on the basis that
a brother-sister relationship exists between Puffin and Hotline. She (incorrectly)
found that the DA made 'a decision' on such a relationship, but nothing much
turns on this since it is common cause that an internal appeal of this nature,
being a wide appeal, is essentially a rehearing de novo. In particular the
Minister determined that '[i]n light of the shareholding of the two companies I
am of the view that the majority shareholders have controlling interests in both
4
entities which goes against the intention in the General Policy' (my emphas is).
I will accept that the Minister intended to refer instead to "close corporations"
and "members interests".
[6] On 22 March 2022 River Queen was notified by the DA that its application had
been excluded for failing to effectively utilise its tuna pole-line (''TPL") right since
it had not harvested the required minimum of 25 tons of tuna annually or a
cumulative amount of 175 tons over the period 2014 (when it was first granted
'
• a right) until 2020.
[7] On 4 May 2022 River Queen lodged an internal appeal with the Minister in
terms of s 80 of the MLRA . Its grounds of appeal were essentially that, as
submitted in its application to the DA , its catches were lower than the required
minimum because (a) it targets tuna for the sashimi and high-end international
markets as was clear from its fishing plan, and as such its fishing strategy and
targets are not 'volume driven but quality driven'; (b) given its 'business and
financial models' it spent considerable time, finances and resources ·sourcing
and gearing the right type of vessel over a period of 4 years, until finally by 2021
a vessel was successfully deployed and produced 26 tons of high quality tuna
over a period of 90 days of fishing; and (c) the 'rigid implementation' of an
annual minimum of 25 tons failed to recognise these factors.
[8] The Minister found that River Queen 'did not deal with the reasons for its poor
catch records. This is ultimately the reason for its exclusion.' It is unclear from
the appeal decision whether the Minister was referring to the alleged failure to
5
provide reasons for the poor catch records or to the poor catch records
themselves. The Minister noted that River Queen had caught a cumulative total
of 69 tons or an average of 10 tons per annum during the period of the
previously allocated right.
[9] She also noted the Sector Policy2 provides that applicants who have failed to
effectively utilise their TPL right for the relevant period will be excluded 'unless
exceptional and compelling reasons exist'; River Queen had raised the
changing of vessels but failed to provide her with supporting dacument~tion on
how this impacted its fishing performance. She determined that:
'2. 2. 14 I find that the Appellant has not furnished exceptional and compelling
circumstances which warrant its exemption of the application of
paragraph 6. 1 ( d) of the Sector Policy. To the contrary, the Appellant
seems to labour under the impression that it should be exempt from
the Sector Policy due to its perceived unique selling proposition, being
the international markets it purportedly supplies.
2. 2. 15 Therefore, I am of the view that the Appellant has failed to provide me
with the necessary evidence demonstrating why it failed to effectively
utilise its Tuna Pole-Line right.
2. 2. 16 I accordingly find that there are no exceptional and compelling
circumstances which warrant the decision of the Delegated Authority
being overturned.'
2 Tuna Pole-Line Fishery Policy: 2021.
6
Puffin review
[1 OJ In paragraph 8.3 of the Tuna General Published Reasons ("GPR ") issued
earlier by the DA on 28 February 2022 she listed all those entities 'which are
suspected of having brother-sister relations amongst them'. Puffin and Hotline
were not on that list.
[11] Clause 8.6.2 of the General Policy3 provides that:
'8.6.2 Brother-Sister Cooperation
If two or more companies which are owned and controlled by the same
shareholders apply for a commercial fishing right in any fishing sector,
the Delegated Authority will consider allocating a fishing right to one of
the companies if two or more of the brother-sister companies qualify for
a fishing right in that particular sector. The Delegated Authority may also
consider dividing one fishing right between the brother-sister companies
if they all qualify for a fishing right in the fishing sector applied for.'
[12) In the case of Puffin there are five members, three of whom are Mr Jendrik
Heyn (10%) , Ms Pauline Braun (30%) and Mr David Dawson (10%).
Accordingly in total they make up 50% of Puffin's members interest. In the case
of Hotline there are three members , Mr Jendrik Heyn (20%), Ms Pauline Braun
(60%) and Mr David Dawson (20%), who thus make up 100% of the members
interest.
3 General Policy on the Allocation of Fishing Rights: 2021 published in GG 45504 of 19 November
2021, also referred to in relation to the invitation at para 3 of this judgment.
7
[13) According to the DA and Minister, Puffin and Hotline are owned and controlled
by the same members , namely Heyn, Braun and Dawson. The Minister relied
squarely on this reason in dismissing Puffin's appeal. However in the answering
affidavit deposed to by the second respondent she maintained that 'the
significant overlap' between Puffin and Hotline is also supported by the fact that
they share the same physical and postal addresses. This could not have been
a reason for the Minister's dismissal of the appeal since it does not feature in
her decision. It is thus fair to infer that it is an attempt to construct an ex post
facto rationalisation for a decision, which is not permissible.4
[14) On the plain wording of clause 8.6.2 there are two prerequisites for a brother
sister relationship, namely: (a) ownership; and (b) control, by the same
shareholders. Again, I accept that "shareholders" may reasonably be construed
to also mean "members ". The point however is that Puffin and Hotline do not
meet the Minister's own requirement since the three members of Hotline
cumulatively hold 50% , and no more, of the members interest in Puffin. Put
differently a cumulative 50% members interest in an entity would at best confer
a right to veto a decision, resulting in a deadlock. This does not equate to
control.
[15) In the founding affidavit Puffin asserted that the Minister's decision on this score
was unlawful since it was 'factually and legally unsustainable'. The specific
ground ins 6 of PAJA 5 was not identified, and is often the case in PAJA reviews,
4 National Lotteries Board and Others v South African Education and Environment Project 2012 (4)
SA 504 (SCA ) at para (27].
5 Promo tion of A dministrative Justice Act 3 of 2000.
8
the court is left in the unenviable position of having to "box" the ground of
complaint into one or more of the s 6 grounds. However on the facts it appears
that s 6(2)(e)(i) is most apposite, namely that the decision was taken for a
reason not authorised by the empowering provision (i.e. clause 8.6.2 of the
General Policy).
[16) Another ground of complaint, not pursued with any vigour in argument, was that
the Minister 'irrationally and unlawfully failed to ensure that the appeal process
she adopted was fair and compliant with section 33 of the Constitution' in that
she was allegedly required to provide 'access to competitor applications,
evaluations and scoresheets and regulation 5(3) appeal reports' which
somehow apparently constituted a 'fatal violation' of Puffin's right to a fair and
rational appeal process.
[17) The short answer to this is that Puffin singularly failed to motivate why it was
entitled to those records and how the so-called failure to provide them adversely
impacted on its internal appeal. Moreover as Puffin itself was constrained to
point out, on appeal the Minister increased its total score from 62.24% to
66.61 % 'confirming further that Puffin Fishing more than qualifies for a tuna
pole fishing right'. It follows that this ground of complaint is devoid of merit.
[18) The last ground of complaint was that its fishing right application was
impermissibly delegated to the DA to determine, since she was not qualified to
do so on the basis that she was 'certainly no expert in the field of fisheries
management , Jet alone the tuna-pole fishing sector'. This complaint also has no
9
merit because on Puffin's own version the DA relied on experts in the industry
approved by Puffin itself to assist her in reaching her decision.
River Queen review
[19] The same grounds of complaint in respect of procedural fairness and
impermissible delegation were raised by River Queen and my findings in
relation to Puffin pertain equally to these grounds.
[20] The pertinent complaint of R iver Queen is encapsulated in the founding affidavit
as follows:
'52. Had the Delegated Authority considered River Queen 's fishing plan
which was appended to its application form as Annexure 5.1 (and
appended hereto marked "FA 11 'J, it would have been patently clear that
River Queen's entire business and operating model is predicated on the
harvesting of tunas for the high-end sashimi export markets. Its focus is
not bulk harvesting of tunas but the selected harvesting of specific tunas
for a very specific market. '
[21] It is contended that had the DA done so, a non-rigid and flexible interpretation
of clause 6(1)(d) of the Sector Policy would have been applied. The PAJA
grounds relied on are 6(2)(e)(iii), i.e. the failure to take relevant considerations
into account, and s 6(2)(f)(ii)(cc), i.e. the decision was not rationally connected
to the information before her. A similar complaint is made in respect of the
Minister's decision to dismiss the appeal but on the broader basis that she failed
to consider the reasons advanced in the appeal as well as the fishing plan.
10
[22] C lause 4 of the Sector Policy sets outs its objectives, amongst other~ 'the need
to ensure optimal, long-term and justifiable use of marine living resources in
order to ensure sustainable development of the fishing sector to achieve
inclusive economic growth ... and to create sustainable employment consistent
with the development objectives of National Government ... ' (my emphasis).
The MLRA obliges the responsible authorities to achieve these ,objectives. In
turn, one of the specific goals for the allocation of fishing rights in the tuna pole
line industry is the improvement of catch performance to promote increases in
future allocations (clause 4(c)).
(23] Clause 6.1 of the Sector Policy provides that the DA will exclude applicants that
fail to meet certain requirements 'unless exceptional and compelling
circumstances exist'. One of these exclusionary criteria is clause 6.1 (d) w hich
reads in relevant part as follows:
'( d) Non-utilization
Category A Applicants that failed to effectively utilise their Tuna Pole
line fishing right between the period 2014 to 2020 and/or have not
collected a catch permit for any particular reason will be excluded.
Effective utilisation shall mean activation and be issued with a permit to
undertake commercial fishing for tuna by means of the pole-line method,
landing of catch and subsequent submission of catch data for at least
six years during the period 2014-2020. In addition, during the same
period, previous Tuna Pole-line right holders will be expected to have
landed at least a total of 25 tonnes of large pelagic species (tuna) for
every fishing season that they were active or a cumulative catch of"?!:. 175
tonnes ... '
11
[24] The founding affidavit makes clear that, in respect of the DA's determination,
River Queen relies only on its fishing plan. It did not annex its full application
which served before the DA , and merely annexed its fishing plan to the founding
affidavit without identifying the portions thereof upon which reliance was placed.
This is impermissible, as is established law.6 The fishing plan is comprised of
four pages. After setting out its harvesting process, on-board handling and
storage, offloading and processing methods, River Queen described its target
market and pricing as follows:
'Ta,:get market
Pricing
Premium quality Yellowfin tuna is aimed at the high
end sushi market. There is both a local and
international client base for this.
Longtin tuna also has a large fresh export
component. The Longtin that gets frozen and
shipped to Spain is manufactured into tinned tuna.
Our whole process revolves around the delivery of
the best possible fish so that we can achieve the best
possible financial returns to make sure our boat
investments are sustainable.'
[25] It is hardly surprising, in these circumstances, that the DA reached the decision
she did, since what is contained in River Queen's fishing plan is skeletal at best.
In its appeal to the Minister, River Queen submitted in relevant part that:
'Our client's application form (section 5) demonstrates that [it] applied for its
fishing permits, reported its catches and submitted all catch levy returns. Its
6 Swissborough Diamond Mines (Pty) Ltd v Government of the Republic of South Africa 1999 (2) SA
279 (T) at 324F-G, since followed consistently in a long line of cases.
12
catches are lower than the annual minimum of 25 tons for the following
reasons:
• Our client targets tunas for the sashimi and high-end international
markets as is clear from its fishing plan. As such, its fishing strategy and
fishing targets are not volume driven but quality driven. The rigid
implementation of a minimum annual catch of 25 tons is irrational and
unreasonable as it fails to take into account that smaller vessels like
that owned by our client targets a very high value, high-end tuna buyer
and customer.
• The rigid implementation of an annual minimum of 25 tons fails to
recognise that (and demonstrates that the delegated authority and her
advisers do not know or understand the tuna pole fishery) the fishery
essentially comprises two categories of boat owners. Those large
vessels that target tunas principally for the frozen tuna and canned tuna
markets; and those smaller boat owners like the applicant that targets
yellowfin tunas for the sashimi markets. This latter category of fisher
does not target volumes as it would harm access to the high value
sashimi market.
• Finally, because the applicant's business and financial models are to
produce tunas for a sashimi market, it spent considerable time, finances
and resources sourcing and gearing the right type of vessel. This
occurred over a period of 4 years as it first attempted to use the MFV
Amber Rose which proved financially unviable. The applicant thereafter
refitted the 40ft Northern Star but that vessel failed to perform
adequately. By 2021, the MFV Maverick was finally successfully
deployed and produced 26 tons of high quality tunas over a period of
90 days of fishing.
What is apparent is that the DA failed to reasonably and properly apply her
mind to our client's application and read our client's submissions in Sections 1
and 5.'
[emphasis supplied: The reference to 'Sections 1 and 5' are presumably to the
application itself, which as previously stated was not placed before the court.]
13
[26] Although in this review River Queen relies only on its fishing plan and
subsequent motivation furnished to the Minister, annexed to the answering
affidavit was its "application form". The second respondent pointed out that
when regard is had to that form, it is apparent that River Queen has only two
permanent, and four part-time, employees in the fishing industry. Also annexed
to the answering affidavit were copies of River Queen's annual financial
statements for the years ended February 2019 to February 2021 inclusive, and
it was further pointed out that, when considered cumulatively, River Queen had
been trading at a loss since 2016. This is relevant to what the DA stated in the
regulation 5(3) report:
' ... the rationale behind the policy is to exclude recreational fishers/fishers who
catch TPL as a side business, who go out a few times and take in big catches
and don't fish regularly. They should be relying on the fishery for income and
creating stable permanent employment by going out to fish consistently. This
is why the Policy set criteria for applicants to meet the catch threshold of
175 tons cumulative and 25 tons annual (which is very low) and for utilisation
for at least 6 years out of the 7, which shows commitment to the fishery. '
[27] The undisputed evidence of the second respondent was further that the amount
of 25 tons was determined based on the average cumulative catch in the tuna
pole-line fishery during the previous FRAP (Fishing Right Allocation Process)
period, and also taking into account that many previous right holders rarely
utilised their commerc ial tuna pole-line fishing rights. The 25 tons are therefore
a tonnage that can be achieved by the average vessel in the fishery. While
dependent on the fishing vessel, 25 tons can be achieved within 5 trips.
14
Evidently, very little is required of a right holder to meet the effective utilisation
requirement.
(28] According to the Minister she took into account that the Sector Policy aims to
address the issue of under-utilisation as well as inefficient utilisation of the
resource given the poor performance during the previous period. She
determined that consistent application of the exclusionary criteria is important.
She was of the view that it is not punitive but has a broader important policy
objective meant to ensure that South Africa rema!ns competitive ihternationally,
and further that recreational fishers are excluded. As set out in her appeal
decision, the Minister determined that River Queen failed to provide exceptional
and compelling circumstances which warrant its exemption from the application
of clause 6.1 (d) of the Sector Policy for the reasons contained therein.
(29] Given that there is a review before me , not an appeal, I can do no better than
repeat what was held by the Constitutional Court in Bato Star. 7
'[48] In treating the decisions of administrative agencies with the appropriate
respect, a court is recognising the proper role of the executive within the
Constitution. In doing so a court should be careful not to attribute to itself
superior wisdom in relation to matters entrusted to other branches of
government. A court should thus give due weight to findings of fact and policy
decisions made by those with special expertise and experience in the field ...
Often a power will identify a goal to be achieved, but will not dictate which route
should be followed to achieve that goal. In such circumstances a court should
pay due respect to the route selected by the decision-maker. This does not
mean however that where the decision is one which will not reasonably result
7 Bato Star Fishing (Pty) Ltd v Minister of Environmental Affairs and Tourism 2004 (7) BCLR 687 (CC).
15
in the achievement of the goal, or which is not reasonably supported on the
facts or not reasonable in the light of the reasons given for it, a court m ay not
review that decision ... '
[30) On the evidence before me I am unable to find that either the DA or the Minister
took a decision which would not: (a) reasonably result in the achievement of the
objectives contained in the Sector Policy; (b) reasonably be supported on the
facts; or (c) be reasonable in light of the reasons given. This dispenses with the
contention that both the DA and the Minister should have applied a more flexible
approach.
[31] However for the sake of comp leteness I deal briefly with River Queen 's related
complaint that in two other instances the Minister overturned the DA 's decision
to exclude another historic right holder for failing to adequately utilise its tuna
pole fishing right. The first is that of Gold Medallion Investments (Pty) Ltd; but
since River Queen singularly failed to provide the court with even a broad
overview as to why this entity's appeal was successful, I am unable to consider
it.
[32) The other is Pelagic Trading (Pty) Ltd. It is clear however from the relevant
appeal decision that the Minister determined the existence of exceptional and
compelling circumstances since 'the Appellant was only allocated a right on
appeal and started fishing in 2017 and thereafter managed to land an average
catch of 25 tons annually. I am convinced that this is evidence of the existence
of exceptional and compelling circumstances that warrant the Appellant to be
exempted from the application of clause 6. 1 (d) of the Sector Policy'. Nothing to
16
this effect was contended by River Queen and moreover the successful Pelagic
Trading appeal demonstrates that despite effective utilisation remaining an
important consideration, the Minister considered each appeal on its particular
facts, which lends credence to her assertion that she applied her mind in the
exercise of her discretion in the instant matter. It follows that the River Queen
review must fail.
Puffin: substitution or remittal, and if remittal whether to Minister or DA
[33) In the founding affidavit it was submitted that should the reviews be upheld the
court should substitute 'the impugned decision' with one granting Puffin and
River Queen a commercial tuna pole fishing right 'on the same terms as those
determined by the Minister as being applicable to current right holders' together
with an order directing that permits to this effect be issued within 10 days.
[34] Given my findings in respect of River Queen it is only necessary to consider
whether it would be appropriate to make such an order in relation to Puffin.
During argument counsel for Puffin appeared to accept that the court cannot do
so, since according to the second respondent there are presently 131 right
holders in the fishery who are cumulatively permitted to operate 140 vessels,
and this court has no idea of what the terms of their fishing rights are.
[35) In any event, in my view this is one of those cases where a substitution of this
nature would definitely cross the line in breach of the separation of powers
doctrine, since by no stretch of the imagination could I be considered in as good
a position as the functionary concerned to determine the terms of a tuna pole
17
fishing right for a Category A applicant. The furthest I can go is to grant Puffin
a right in terms of s 18 of the MLRA and defer (i.e. remit) to the functionary what
its terms should be (including allocation of effort and permit conditions in terms
of s 13 of the MLRA ). This is particularly so given the level of expertise required
and policy-laden nature of these allocations.
[36] Counsel for Puffin submits that I should remit to the Minister since it is she who
corrected the DA 's erroneous scoring and granted Puffin an increased final
score of 66.61%. This makes sense since at least to this extent the DA is
functus officio, and it was not the DA , but the Minister, who made the
determination on the brother-sister relationship. I thus disagree with counsel for
the Minister, second respondent and DA that I should instead remit to the DA
for, amongst others, Puffin and Hotline 'to be rescored', given also that Hotline
elected not to participate in the review despite surely having been aware that
Puffin scored higher on appeal. In any event it is Puffin which has willingly
forfeited its right to any internal appeal against a determination by the DA in
seeking a remittal only to the M inister, and which will again be limited to
approaching court for a further review if dissatisfied with the outcome.
Costs
[37] The applicants have only been partially successful. In addition various points
and grounds of complaint w ere effectively abandoned during argument, and for
reasons which are unexplained both applicants took it upon themselves to
make unseemly and unwarranted ad hominem attacks on both the DA and the
18
Minister. In the circumstances the appropriate order to make is the one that
follows.
[38] The following order is made:
1. The decision by the first respondent to refuse the first applfoant a
commercial tuna pole fishing right on the basis that it is related by
application of the "brother-sister" relationship criterion to Hotline
Fishing CC is reviewed _and set aside;
2. The first applicant is granted a commercial tuna pole fishing right in
terms of section 18 of the Marine Living Resources Act 18 of 1998
("MLRA") for the period 1 March 2022 until 28 February 2037 on such
terms as the first respondent may determine in terms of section 13 of
the MLRA;
3. Save as aforesaid the application is dismissed; and
4. Each party shall pay their own costs.
JICLOETE
For applicants: Adv S Moolla
Instructed by: Sm ith & Associates (Mr D Smit)
For first to third respondents: Adv J De Waal SC with Adv R Matsala
Instructed by: State Attorney (Mr L Manue l)
t