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[2012] ZASCA 205
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Makhanya NO v Goede Wellington Boerdery (Pty) Ltd and Another (230/12, 233/12) [2012] ZASCA 205; [2013] 1 All SA 526 (SCA) (30 November 2012)
Links to summary
IN
THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
CASE
NO: 230/12
and
CASE NO: 233/12
Reportable
In
the matter between:
ATWELL
SIBUSISO MAKHANYA NO
......................................
FIRST
APPELLANT
MINISTER
OF WATER AND ENVIRONMENTAL
AFFAIRS
...............................................................................
SECOND
APPELLANT
and
GOEDE
WELLINGTON BOERDERY (PTY) LTD
..............................
RESPONDENT
Neutral
Citation:
Makhanya v Goede Wellington Boerdery (Pty) Ltd
(230/12)
[2012] ZASCA 205
(30 November 2012)
Coram:
HEHER,
BOSIELO, TSHIQI and THERON JJA and ERASMUS AJA
Heard:
5 November 2012
Delivered:
30 November 2012
Summary:
Administrative Law – whether the decision taken by the Water
Tribunal in refusing an appeal against a decision of
the Chief
Director rejecting an application for a water licence constitutes
administrative action reviewable under the
Promotion of
Administrative Justice Act 3 of 2000
– whether it was
appropriate for the court below when setting aside the decision of
the Tribunal, to substitute its own decision,
rather than remitting
the matter to the Tribunal – whether the court below was
entitled to make a costs order against a presiding
officer (the First
Appellant) performing an adjudicative function in the event of the
review against his findings being successful.
______________________________________________________________
ORDER
______________________________________________________________
On
appeal from
: North Gauteng High Court, Pretoria (Goodey AJ
sitting as court of first instance).
The appeal of the first
appellant is upheld with costs including the costs of two counsel.
The appeal of the second
appellant is dismissed with costs including costs of two counsel.
The order of the court a
quo is amended to read:
The decision taken on 5
May 2010 by the First Respondent, dismissing the
Applicant’s appeal
against the refusal by the Chief Director: Water Use in the
Department of Water Affairs and Forestry of
the Applicant’s
application for a licence to use water from the Berg River is
reviewed and set aside.
The said decision is
substituted with the following:
‘
1.
The appeal by Goede Wellington Boerdery (Pty) Ltd against the
refusal on 11 April 2008
by the Chief Director: Water Use in the
Department of Water
Affairs and Forestry of the Applicant’s
application for a licence
to use water from the Berg River to which
ECPA Boerdery (Pty) Ltd
is currently entitled’, is upheld.
The said licence is
granted to Goede Wellington (Pty) Ltd.’
The Second Respondent is
to pay the Goede Wellington’s costs, including the costs of
two counsel.’
______________________________________________________________
JUDGMENT
______________________________________________________________
ERASMUS AJA (HEHER,
BOSIELO, TSHIQI and THERON JJA concurring)
Introduction
[1]
This
appeal, against the whole of the judgment and order of the North
Gauteng High Court, Pretoria (high court), concerns a decision
taken
by Mr Makhanya (the first appellant), an additional member of the
Water Tribunal (Tribunal) established in terms of s 146
of the
National Water Act
1
(the
Act). The Tribunal dismissed an appeal against the refusal, by what
was then the Department of Water Affairs and Forestry (the
Department), of an application for a licence to use water for farming
purposes from the Berg River in the Wellington area of the
Western
Cape. The high court reviewed and set aside the Tribunal’s
dismissal of the appeal, substituted the Tribunal’s
decision by
upholding the appeal, granted the water licence and ordered the
Minister of Water and Environmental Affairs (second
appellant) and
the first appellant to pay costs.
[2]
The first appellant heard the appeal in his capacity as an additional
member of the Tribunal. His appeal in this court is confined
to the
high court’s order that he is to pay the costs in his official
capacity. The second appellant’s appeal is confined
to two
issues, namely, whether the Tribunal’s decision constitutes
administrative action reviewable under the Promotion of
Administration Justice Act (PAJA)
2
and
(assuming it is), whether it was appropriate for the court a quo when
setting aside the Tribunal’s decision, to substitute
its own
decision in place thereof, rather than remitting the matter to the
Tribunal.
Background
[3] The National Water
Act came into force on 1 October 1998. The preamble reads as follows:
‘
Recognising
that water is a scarce and unevenly distributed national resource
which occurs in many different forms which are all
part of a unitary,
inter-dependent cycle;
Recognising that while water is a
natural resource that belongs to all people, the discriminatory laws
and practices of the past
have prevented equal access to water, and
use of water resources;
Acknowledging the National
Government’s overall responsibility for and authority over the
nation’s water resources and
their use, including the equitable
allocation of water for beneficial use, the redistribution of water,
and international water
matters;
Recognising that the ultimate aim of
water resource management is to achieve the sustainable use of water
for the benefit of all
users;
Recognising that the protection of the
quality of water resources is necessary to ensure sustainability of
the nation’s water
resources in the interests of all water
users; and
Recognising the need for the
integrated management of all aspects of water resources and, where
appropriate, the delegation of management
functions to a regional or
catchment level so as to enable everyone to participate.’
[4] Goede Wellington
Boerdery (Pty) Ltd (Goede Wellington), the respondent, is the owner
of the farm Goede Hoop (Goede Hoop) in
the Wellington area. ECPA
Boerdery (Pty) Ltd (ECPA) is the owner of a farm Middelpos which is
situated near Goede Hoop, approximately
300 meters apart. The sole
shareholder of Goede Wellington, Mr Edward Malan, is also a trustee
and a beneficiary of the Middelpos
Trust which in turn is the sole
shareholder of ECPA.
[5] ECPA is the legal
holder of an entitlement to use water from the Berg River in respect
of Middelpos. A small portion of the
water use entitlement held by
ECPA in respect of Middelpos became available for transfer
3
as a result of an investment made in updated irrigation technology
which resulted in the saving of water. In particular, ECPA shifted
from the use of sprinkler and flood irrigation to drip irrigation.
[6]
Goede Wellington in turn owns an entitlement to use water from the
Berg River in respect of Goede Hoop. It however needed further
water
to facilitate the development of a high quality citrus orchard.
During July 2005 it thus entered into an agreement with ECPA
according to which the latter would surrender some of its water use
entitlement to Goede Wellington for use on Goede Hoop. Goede
Wellington’s use was made conditional upon it obtaining the
necessary licence from the Department.
[7] In
November 2005 Goede Wellington applied to the Department for a water
licence in terms of the Act
4
for
the use of water in respect of seven hectares of irrigable land. It
indicated that it intended to use the land for high quality
citrus
production. This would promote the efficient use of good agricultural
land in the area; ensure better opportunities for
sustainable
permanent employment; contribute to investment; increase in economic
activity and the influx of export revenue for
the local economy. The
application was supported by, amongst others, the Berg River
Irrigation Board
5
and
the Department of Agriculture in the Western Cape Provincial
Government.
[8] In March 2006 the
Regional Director: Western Cape of the Department (Regional Director)
recommended the approval of the licence
application. Its
recommendation was accompanied by a detailed analysis of the
application in relation to s 27(1) of the Act. Section
27(1) provides
an open list of factors to be considered by a licensing authority in
the adjudication of a licence application.
The section provides:
‘
(1) In
issuing a general authorisation or licence a responsible authority
must take into account all relevant factors, including–
(a) existing lawful water uses;
(b)
the need to redress the results of past racial and gender
discrimination
;
(c) efficient and beneficial use of
the water in the public interest;
(d) the socio-economic impact–
of the water use or uses if
authorised; or
of the failure to authorise the water
use or uses;
(e) any catchment management strategy
applicable to the relevant water resource;
(f) the likely effect of the water use
to be authorised on the water resource and on other water users;
(g) the class and the resource quality
objectives of the water resource;
(h) investments already made and to be
made by the water user in respect of the water use in question;
(i) the strategic importance of the
water use to be authorised;
(j) the quality of water in the water
resource which may be required for the Reserve and for meeting
international obligations;
and
(k) the probable duration of any
undertaking for which a water use is to be authorised.’
(My underlining.)
[9] The Regional Director
found in favour of Goede Wellington on each of the factors analysed
and concluded that the existing legal
uses of the water would not be
affected by the transfer, that after the transfer the water will be
put to more efficient use (this
was also recognised by the Department
of Agriculture) and that export revenue will be generated. Most
importantly for present purposes,
in relation to the factor relating
to redressing the results of past racial and gender discrimination,
the recommendation found,
firstly, that the transfer would create new
job opportunities in what, it can be remarked, is an unemployment
stricken labour market
and that ‘[i]f the transfer of the water
use is not authorised, job opportunities will be lost’.
Secondly, the report
remarked that Goede Wellington employed both
male and female workers.
[10] In May 2007 the
Chief Director: Water Use in the Department (the Chief Director)
wrote to Goede Wellington. The Chief Director
indicated,
notwithstanding the Regional Director’s recommendation, that
the ‘application neither contributes to redress
of the results
of the past racial discrimination nor promotes the equitable access
to water’ and that Goede Wellington should
show cause why the
application should not be denied on that basis. In response, Goede
Wellington submitted a ‘social and
labour management report’
compiled by human resource consultants as well as an ‘economic
report’. In these reports,
along the lines of the Regional
Director’s findings, it was again submitted that Goede
Wellington is committed to affirmative
action, that it has a skills
development plan in place and that it is committed to employment
equity. It also stated that it aids
its employees by ‘increasing
employee(s)(sic) access to educational institutions and by the
inclusion of less advantaged
groups in the company management
structure and (furthermore)(sic) to empower women in its current
service’.
[11] In July 2008 the
Chief Director, however, informed Goede Wellington that the licence
application had been denied as issuance
of the licence ‘will
not contribute towards the need to redress the result of the past and
racial gender discrimination’.
Proceedings before the
Tribunal
[12]
During August 2008 Goede Wellington appealed the decision of the
Chief Director to the Tribunal,
6
whose
decision was in turn the subject of the appeal to the court a quo.
Item 6(1) of Schedule 6 of the Act provides that an appeal
to the
Tribunal must be heard by one or more members, as the chairperson may
determine, and item 6(3) adds that an appeal takes
the form of a
rehearing and that the Tribunal may receive evidence. In advance of
the hearing, Goede Wellington provided the Tribunal
with an affidavit
which included an account of the factual background to the licence
application and provided the relevant information
in respect of all
eleven factors listed in s 27(1) of the Act. In addition, the legal
representative of Goede Wellington submitted
detailed heads of
argument to the Tribunal.
[13] On 5 May 2010, the
Tribunal found against Goede Wellington. It ruled that:
‘
The Social
and Labour Management Report presented by the applicant is silent on
both the issues of land ownership and involvement
at management level
or participation in the running of agricultural enterprise by people
from previously disadvantaged communities.
When all was said and done
. . . there existed no evidence before the Tribunal to the effect
that the relevant factors set out
in section 27(1) of [the Act] were
not considered and no evidence was rendered proving that the
application is in consonance with
the objectives of section 27(1)
(b)
of the [Act].’
Proceedings before the
high court
[14]
Consequently Goede Wellington approached the high court. It sought an
order inter alia in terms of ss 6 and 8 of PAJA reviewing
the
decision of the Tribunal, setting it aside, substituting it with an
order granting the licence to Goede Wellington and mulcting
Mr
Makhanya in costs in his official capacity. In the alternative, Goede
Wellington asked for an order, inter alia, that its application
be
deemed to be an appeal in terms of s 149 of the Act.
7
The
ground of appeal was that the Tribunal erred and misdirected itself
and did not comply with s 27(1) of the Act, read with Item
6(3) of
Schedule 6
8
thereto,
by determining the appeal with reference solely to one of the factors
in s 27(1)
(b)
of
the Act and evidence in relation to that factor, alternatively with
inadequate regard to the other factors in s 27(1) of the
Act and the
evidence in relation to those factors.
[15]
The second appellant opposed the application for judicial review in
principle, arguing that because decisions of the Tribunal
are subject
to appeals to the high court on questions of law under s 149(1)
(a)
of the Act the legislature did not
intend to create a review or appeal procedure which is based on
procedural irregularities or
factual disputes.
[16]
The second appellant also opposed the application (whether for
judicial review or an appeal under s 149) on its merits, saying,
amongst other things, that the Department made a balancing act of the
factors listed in section 27(1) and after that balance the
application was refused on the basis that it did not satisfy section
27(1)(b), being one of the factors that must be taken into
account.
The second appellant added that the factor listed in s 27(1)
(b)
embodies all of the socio-economic factors
defining the purpose of the Act
as set out
in s 2, and is the only viable way to achieve the purpose to ensure
that the allocation of our water resources redress
the result of past
racial and gender discrimination.
[17]
The high court, referring to the constitutionally enshrined right to
lawful, reasonable and procedurally fair
administrative action, found that the mere fact
that the Act is silent on a right to review an application for a
licence does not
mean that that right is excluded. It emphasised the
fact that courts must treat the decisions of the executive with
appropriate
respect, but also that courts may not rubberstamp
unreasonable decisions simply because of the complexity of the
decision or the
identity of the decision-maker and that their
deference to the executive must not be shaped by an unwillingness to
scrutinise administrative
action, but by a careful weighing up of the
need for and the consequences of judicial intervention. It found that
the Act allows
for review in appropriate circumstances and that the
Goede Wellington’s case was such an instance. As a result of
the court
a quo’s decision to uphold the application for
judicial review, it did not consider Goede Wellington’s
alternative
appeal under s 149 of the Act.
[18] The court came to
the conclusion that Mr Makhanya misinterpreted s 27(1) of the
Act. In doing so, he committed a material
error of law. It found that
it was clear that the Tribunal adjudicated the appeal as if the
factor provided for in s 27(1)
(b)
was a prerequisite for the
granting of a water licence, and that it did not consider all
relevant factors as required by s 27(1).
This was also evidence of
the fact that the Tribunal had not applied its mind properly. The
decision therefore fell to be set aside.
[19] The court further
found that the required exceptional circumstances existed for
substituting its decision for that of the Tribunal.
It found that it
was at least as well qualified as the Tribunal to decide the matter,
that sending it back to be heard by the Tribunal
would be a waste of
time and that further delay would cause unjustifiable prejudice to
Goede Wellington. Further, it found that
the decision of both the
Chief Director and the Tribunal displayed an alarming degree of
ineptitude, a lack of appreciation of
what was required of them, a
lack of judgment, rationality, common sense and serious incompetence.
[20] For those reasons
and, in addition, for the Tribunal’s lack of expertise, legal
prowess, failure to apply its mind and
the failure to have a legal
expert on board the court made a cost order against the second
appellant and Mr Makhanya (first appellant)
in his official capacity
as a member of the Tribunal, the one paying the other to be absolved.
The appeal in this
court
[21] The second
appellant, whilst accepting that the Chief Director’s decision
not to grant the water licence to Goede Wellington
was an
administrative action reviewable under PAJA, argues that the decision
of the Tribunal did not constitute administrative
action reviewable
under PAJA. Further, and if it should be found that PAJA does apply,
the second appellant argues, no exceptional
circumstances were
present which would allow the high court to substitute its decision
for that of the Tribunal. Accordingly that
court should have remitted
the matter to the Tribunal.
[22] The second appellant
now also concedes that an error of law was made, which both underlies
the main ground of review upheld
by the court a quo and constitutes
Goede Wellington’s ground of appeal that the Tribunal
considered only one of the factors
(being that under s 27(1)
(b)
)
as essential and decisive, rather than considering all of the factors
prescribed in the statute (and any other considerations
that might be
relevant) in reaching its decision.
[23] The second appellant
points to various indicators in the Act which, according to him,
shows that the decision of the Tribunal
in Goede Wellington’s
case, was not ‘truly of an administrative nature’: the
Tribunal sits as an appellate body,
exercising what are in effect
judicial functions akin to that of a court. In this regard, the
second appellant submits that it
is significant that the Act does not
make an express reference to any right of review, instead the
legislator provided for an appeal
directed to the high court only on
an issue of law.
[24] Mr Makhanya only
opposes the costs order made against him in his official capacity.
[25] Goede Wellington
essentially supports the judgment of the high court. It submits that
the decision to dismiss the appeal against
the Chief Director’s
refusal of the licence application is administrative action as
defined in PAJA and that the court a
quo correctly substituted its
decision for that of the Tribunal. The question of exceptional
circumstances has substantially changed:
new evidence was admitted in
this appeal that the Tribunal has been dissolved. What is more, it
says, there is no justification
for this court to interfere with the
court a quo’s discretionary decision to award costs against Mr
Makanya in his official
capacity.
[26] I now turn to the
consideration of whether the decision of the Tribunal was reviewable
under PAJA and could be substituted
by the court a quo.
[27]
The Tribunal effectively had to rehear the application for the water
licence. It is well recognised that an application of
that nature
will ordinarily qualify as administrative action, since the advent of
the Constitution.
9
Administrative appeals usually allow for the reconsideration of an
administrative decision by a higher authority.
10
Indeed, Hoexter, writing in general, says that the ‘person or
body to whom the appeal is made steps into the shoes of the
original
decision-maker, as it were, and decides the matter anew.’
11
However, each Tribunal falls to be considered relative to its
empowering legislation.
12
[28]
This court in
South
African Technical Officials’ Association v President of the
Industrial Court & Others
1985
(1) SA 597(A)
at 610G-I held that a body that is empowered to perform
some of the functions of a court of law is not necessarily to be
regarded
as a court of law.
13
An
administrative body can perform the duties and functions of a court
of law without becoming one. The status and true identity
of a
particular body is not determined solely by the nature and the type
of the functions it performs. Certain factors are indicative
of
whether a tribunal should indeed be seen as a court of law. This
approach was approved in
Sidumo,
where
Navsa AJ (with whom the majority of the Constitutional Court
concurred on this issue) held that while there are similarities
between arbitrations before the Commission for Conciliation,
Mediation and Arbitration (“CCMA”) established by the
Labour Relations Act 66 of 1995
and proceedings before a court of
law, the CCMA is not a court of law because there are also
significant differences, including
that: a commissioner is empowered
to conduct the arbitration with the minimum of legal formalities,
there is no blanket right to
legal representation, the CCMA does not
follow a system of binding precedents, and commissioners do not have
the same security
of tenure as judicial officers or undergo judicial
training.
[29] In the instant
matter the members of the Tribunal do not have the same security of
tenure as judicial officers. Item 1 of Schedule
6 to the Act provides
that a member is appointed for a period determined by the second
appellant. In terms of item 4, read with
s 146(8)
of the Act, the
appointment of a member may be terminated ‘for good reason’
by the second appellant and after ‘consultation
with the
Judicial Service Commission’. The uncertain tenure of the
office those selected to comprise the Tribunal, is not
compatible
with judicial independence.
14
[30] As to the training
of the members of the Tribunal, some have no legal training or
expertise. They may be appointed on the recommendation
of the Water
Research Commission established by s 2 of the Water Research Act
15
because they are qualified in water resource management or
engineering in related fields. It is thus perfectly possible and in
accordance with the Act that an appeal to the Tribunal could to be
conducted by a person who has no legal experience or training
and
merely has a degree in engineering. These factors go to show that the
court is dealing with an administrative tribunal which
performed an
administrative action, as defined in s 1 of PAJA, in dismissing Goede
Wellington’s appeal.
[31]
In
President
of the RSA v South African Rugby Football Union
16
with
reference to the right to administrative justice in terms of s 33 of
the Constitution it was stated:
‘
In s 33 the
adjective “administrative” not “executive” is
used to qualify “action”. This suggests
that the test for
determining whether conduct constitutes “administrative action”
is not the question whether the action
concerned is performed by a
member of the executive arm of government. What matters is not so
much the functionary as the function.
The question is whether the
task itself is administrative or not. It may well be, as contemplated
in
Fedsure
,
that some acts of a legislature may constitute “administrative
action”. Similarly, judicial officers may, from time
to time,
carry out administrative tasks.
17
The focus of the
enquiry as to whether conduct is “administrative action”
is not on the arm of government to which the
relevant actor belongs,
but on the nature of the power he or she is exercising.’
The nature of the power
exercised by the Tribunal was no less and no more than a
consideration of whether a water licence should
be granted or not.
Consequently the court a quo was correct in finding that the decision
of the Tribunal constituted administrative
action.
[32] The second appellant
conceded that the Tribunal made an error of law in only considering
one of the factors as essential and
decisive, rather than considering
all the relevant factors prescribed in the statute.
[33]
To my mind, however, and according to Goede Wellington, the
reasonableness of the decision must also be called into question.
The
Constitutional Court has previously had occasion to address
administrative decision-making where the official is faced with
a
number of considerations of which racial redress is one. Much like
the situation facing the court in
Bato
Star
,
18
s
27
(b)
contains
a wide number of objectives and principles. Some of them may be in
conflict with one another, as they cannot all be fully
achieved
simultaneously. There may also be many different ways in which each
of the objectives stand to be achieved. The section
does not give
clear guidance on how the balance an official must strike is to be
achieved in doing the counterweighing exercise
that is required.
19
As
opposed to the legislative scheme before the court in
Bato
Star
,
there is no indication in the Act that s 27(1)
(b)
is
to be regarded as in any way more important than the other factors.
[34]
As to the s 27(1)
(b)
requirement
itself, our courts recognise that, at least where there is no express
legislative provision to the contrary, transformation
such as that
envisioned in the section can be achieved in a myriad of ways.
Indeed, there is no one simple formula to achieve transformation.
20
[35]
Section 6(2)
(h)
of
PAJA
requires
a simple test: an administrative decision will be reviewable if it is
one a reasonable decision-maker could not reach.
21
In the instant case, where the administrator was faced with a balance
to be struck, it is constitutionally endorsed and opportune
to ask:
did the administrator strike a balance fairly and reasonably open to
him?
22
[36] . It is not for the
courts to consider whether the Tribunal’s decision was the best
decision in the circumstances, and
overstep the limits imposed on
this court by our constitutionally enshrined separation of powers
doctrine.
23
The court in fulfilling its judicial function is to enquire whether
the Tribunal’s decision struck a reasonable balance between
all
the factors set out in s 27
(b)
, and some not mentioned in the
section, owing to its inclusive nature.
24
[37] It must be observed
that the need to redress the results of past racial and gender
discrimination is only one factor in a non-exhaustive
list of several
factors that have to be taken into account when issuing a licence. It
clearly does not presuppose a crude approach
where a s 27(1)
(b)
sledgehammer should be taken to an otherwise exemplary
application. In this case, it cannot even be said with any degree of
certainty
that Goede Wellington did not satisfy the s 27(1)
(b)
requirement standing on its own. The Regional Director Western
Cape concluded that Goede Wellington’s application did indeed
satisfy the requirement.
[38] The preamble to the
Act makes it clear that water is a natural resource that belongs to
all people and that the discriminatory
laws of the past have
prevented equal access to water and the use of water resources. It
makes it equally clear that water in South
Arica is scarce. The
preamble recognises that the ultimate aim of water resource
management is to achieve the sustainable use of
water for the benefit
of all users. It states that the ’protection of the quality of
water resources is necessary to ensure
sustainability of the nation’s
water resources in the interests of all water users’.
[39]
The Act provides many factors, one of which is the redress factor. It
must be seen against the background of the constitutional
commitment
to achieving equality and remedying the consequences of past
discrimination.
25
Section 9 of the Constitution provides that ‘[t]o promote the
achievement of equality, legislative and other measures designed
to
protect or advance persons, or categories of persons, disadvantaged
by unfair discrimination may be taken.’ But transformation
can
be achieved in various ways.
26
How it is to be achieved in accordance with a particular Act is an
issue of, among other things, legislative interpretation.
27
The process to be followed in the instant case is not delineated by a
points scoring system or the like to assist the Tribunal
in assessing
a particular application. The assessment is largely left to the
official’s ability to assess a particular application
in
relation to the factors stipulated in s 27
(b)
.
[40]
The Act provides an open and transparent means by which applications
must be assessed. Although much is left to the discretion
of the
decision maker who is allowed to take factors into consideration not
mentioned in the list, it is clear that s 27
(b)
and
indeed the rest of the Act, requires these factors to be assessed by
finding an appropriate balance after evaluating all the
factors
expressly provided for and others. Neither the Act nor the section
attributes any significant weight to any of the factors.
And, to my
mind, a decision maker, who would not be able to add factors to a
closed legislative list of factors, cannot on a whim
decide to
elevate one factor to pre-eminence. That this was done is clear from
the reasons provided by the Tribunal. The court
a quo was therefore
correct in concluding that the decision not to grant the licence
sought by Goede Wellington had been unlawful.
[41] I
now turn to the substitution order made. PAJA provides that in
judicial review proceedings a court may grant any order that
is just
and equitable.
28
It
expressly provides for orders which are included within the just and
equitable rubric. An order setting aside an administrative
action can
be coupled with other remedies such as remitting the matter for
reconsideration, varying an administrative action and
correcting a
defect. PAJA further provides that it would be just and equitable for
a court to substitute an administrative action
with one of its own
making in ‘exceptional circumstances’.
29
It is
this remedy that the court a quo thought competent. The high court
quashed the administrator’s decision and substituted
its
decision for that of the Tribunal, awarding the licence sought to
Goede Wellington.
[42]
PAJA does not provide guidelines as to what may be understood under
the term ‘exceptional circumstances’. However,
the
recognition of the principle that a court should be slow to assume a
discretion which has been statutorily entrusted to another
tribunal,
which finds expression in the statutory requirement,
30
predates
the Act’s enactment in our law. In
Johannesburg
City Council v Administrator, Transvaal
31
Hiemstra
J after recognising the principle, held that where the end result is
in any event a foregone conclusion and it would merely
be a waste of
time to refer the matter back to the administrative functionary, the
court will depart from the ordinary course.
Most relevant to the
instant case is that it was held that a court would be particularly
willing to substitute its decision for
that of the administrative
functionary where ‘much time has already been lost by an
applicant to whom time is in the circumstances
valuable, and the
further delay which would be caused by the reference back is
significant in the context.’
32
It was
held that the object of this consideration is to minimise future loss
of time.
33
Johannesburg
City Council
,
written in 1969, has however been held not to fully describe the
position under the Constitution and PAJA.
[43] A
case is exceptional when, on a proper consideration of the relevant
facts, a court is persuaded that a decision to exercise
the power in
question should not be left to the designated functionary. That
determination will be made with reference to established
principles,
like those in
Johannesburg
City Council
,
informed by the constitutional imperative that administrative action
must be lawful, reasonable and procedurally fair.
34
As the
Constitution enshrines everyone’s rights to lawful, reasonable
and procedurally fair administrative action,
35
a
court has to have regard to considerations of fairness.
36
There
will be no remittal to an administrative authority in cases
where
such a step will operate procedurally unfairly.
37
[44] A
further important consideration is whether the court a quo was in a
position to make the decision and whether, in addition,
fairness
dictated that it should have done so. It must be emphasised that an
administrative decision making body is generally best
equipped by its
composition, experience, and access to sources and expertise to make
the right decision.
38
It is
now established that the mere fact that a court considers itself as
qualified to take the decision in place of the administrator
is not
sufficient for it to do so. Fairness to the applicant must also be
considered and could tilt the scale in favour of an applicant.
Considerations of fairness may in a given case require the court to
make the decision itself provided it is able to do so.
39
[45] The only reasonable
decision that could have been reached by the Tribunal, had it
assessed the appeal in accordance with the
Act, is that Goede
Wellington’s application for a licence should be granted. What
is more, further delay will cause unjustifiable
prejudice to Goede
Wellington. The trees in the citrus orchard were already planted
between six and eight years ago and they require
the additional water
as soon as possible in order to develop and produce to their full
potential.
[46] Furthermore, from
what has come to the attention of the court, both from the Bar and
from communications between the parties
which form part of the
record, the consideration of a referral back to the Tribunal for a
speedy result would be to rely on wishful
thinking. The Tribunal has
been disbanded. Counsel for the second appellant informed the court
that there are amendments to the
Act in the offing. However, neither
counsel could indicate whether and when the Tribunal would be
functional again. The Goede Wellington
could face an indefinite delay
in consequence of remittal.
[47] Astoundingly, after
acknowledging the foregoing in a communication addressed to Goede
Wellington, the State Attorney informed
it that should this court
rule in the second appellant’s favour the matter will be
referred to a mediation panel in accordance
with s 150 of the Act. I
say astounding, as the mediation panel provided for in s 150 is aimed
at the settling disputes through
a process of mediation and
negotiation. It is not a body appropriate to consider the application
for awarding of licenses.
[48] In the event,
exceptional circumstances exist which show that the court a quo’s
substitution order was well made. What
is more, considerations of
fairness overwhelmingly dictate that this matter be speedily resolved
by this court.
Costs
[49] The high court
awarded costs against Mr Makanya in his official capacity. As it will
be recalled, Mr Makanya did not oppose
the relief sought either in
the high court or this court, he merely challenged the order of costs
made against him.
[50]
It is trite that in awarding costs a court of first instance
exercises a judicial discretion. A court of appeal cannot interfere
in the exercise of that discretion merely because it would have made
a different order.
40
The
power of this court, a court of appeal, to interfere is limited to
those cases where the exercise of the judicial discretion
is vitiated
by misdirection, irregularity, or the absence of grounds on which the
court below, acting reasonably, could have made
the order in
question.
41
[51]
The general principles relating to awards of costs against public
officers were stated by Innes CJ in
Coetzeestroom
Estate and GM Co v Registrar of Deeds.
42
The
central tenet of these principles is that mulcting an official in
costs where his action or attitude, though mistaken, was bona
fide
would be inequitable. It was also established that it would be
detrimental to the proper functioning of the administration
which is
essential in the public interest to maintain. This is as the official
would be hampered in making the decisions he is
mandated to make in
fear of a costs order being made against him in subsequent
litigation. It was also laid down that this would
be so whether he is
indemnified from paying from his own pocket or not. What is more,
where a public official does not oppose the
relief sought or opposes
with the motive merely to assist the court, no cost order will in the
normal course be made against him.
43
However,
the court, in keeping with its discretion to make a costs order it
deems fit, retains the right to make a costs order where
an
official’s actions are mala fide or grossly irregular.
44
Proof
of mala fides or grossly unreasonable conduct is necessary.
45
[52] In the instant case
no mala fides or grossly unreasonable conduct was proved and the high
court erred in mulcting Mr Makhanya
in costs. As has been shown, he
at most struck a balance not open to him in law.
Order
[53] 1. The appeal of the
first appellant is upheld with costs including the costs of two
counsel.
2. The appeal of the
second respondent is dismissed with costs including costs of two
counsel.
3. . The order of the
court a quo is amended to read:
(1) The decision taken on
5 May 2010 by the First Respondent, dismissing the Applicant’s
appeal against the refusal by the
Chief Director: Water Use in the
Department of Water Affairs and Forestry of the Applicant’s
application for a licence to
use water from the Berg River is
reviewed and set aside.
The said decision is
substituted with the following:
‘
1.
The appeal by Goede Wellington Boerdery (Pty) Ltd against the refusal
on 11 April 2008 by the Chief Director: Water Use in the
Department
of Water Affairs and Forestry of the Applicant’s application
for a licence to use water from the Berg River to
which ECPA Boerdery
(Pty) Ltd is currently entitled, is upheld.
2. The said licence is
granted to Goede Wellington (Pty) Ltd.’
3. The Second Respondent
is to pay the Goede Wellington’s costs, including the costs of
two counsel.’
___________________
N ERASMUS
ACTING JUDGE OF APPEAL
APPEARANCES:
FOR
FIRST APPELLANT: M Mojapelo
Instructed
by:
L
Mbanjwa Incorporated, Pretoria
Naudes
Attorney, Bloemfontein
FOR
SECOND APPELLANT: P Kennedy SC (with him T Makhubele)
Instructed
by:
The
State Attorney, Pretoria
The
State Attorney, Bloemfontein
FOR RESPONDENT: AM
Breitenbach SC (with him EF van Huyssteen)
Instructed
by:
Werksmans
Incorporated, Tyger Valley
Symington
& de Kok, Bloemfontein
1
Act
36 of
1998
2
Act
3
of 2000.
3
Section
25 of the Act reads as follows:
‘
(1)
A water management institution may, at the request of a person
authorised to use water for irrigation under this Act, allow
that
person on a temporary basis and on such conditions as the water
management institution may determine, to use some or all
of that
water for a different purpose, or allow the use of some or all of
that water on another property in the same vicinity
for the same or
a similar purpose.
A person holding an
entitlement to use water from a water resource in respect of any
land may surrender that entitlement or
part of that entitlement –
in order to facilitate
a particular licence application under section 41 for the use of
water from the same resource in respect
of other land; and
on condition that the
surrender only becomes effective if and when such application is
granted.
. . .’
4
See
ss 40 and 41 of the Act.
5
Being
responsible for the management of water in respect of the applicable
catchment area.
6
Section
148(1)
(f)
of
the Act provides for an appeal against a decision of a responsible
authority on a water licencing application.
7
Section
149 of the Act reads as follows:
‘
(1)
A party to a matter in which the Water Tribunal –
has given a decision
on appeal under section 148, may, on a question of law, appeal to
a High Court against that decision;
or
. . .
The appeal must be
noted in writing within 21 days of the date of the decision of the
Tribunal.
. . .
The appeal must be
prosecuted as if it were an appeal from a Magistrate’s Court
to a High Court.’
8
Item
6(3) of schedule 6 of the Act reads as follows:
‘
Appeals
and applications to the Tribunal take the form of a rehearing. The
Tribunal may receive evidence, and must give the appellant
or
applicant and every party opposing the appeal or application an
opportunity to present their case.’
9
Cora
Hoexter
Administrative
Law in South Africa
2 ed (2012) at
184. Also see
Lebowa Granite (Pty) Ltd
v Lebowa Mineral Trust
1999 (4) SA 375
(T) at 382E-G;
Commissioner, South
African Police Service v Maimela
2003
(5) SA 480
(T) at 485D; and in relation to PAJA
Magingxa
v National Commissioner, South African Police Service
2003 (4) SA 101
(TkH) at 109J-110A.
10
Hoexter
Administrative Law
at
65.
11
Id.
12
Chapter
15 of the Act
13
Also
see
Sidumo & Another v Rustenburg
Platinum Mines Ltd & others
2008
(2) SA 24
(CC) para 82.
14
See
Sidumo
at
612D.
15
34
of 1971.
16
2000
(1) SA 1
(CC) para 141.
17
There
may be circumstances in which the performance of administrative
functions by judicial officers infringes the doctrine of
separation
of powers. That, however, is not an issue we need consider here.
18
Bato
Star Fishing (Pty) Ltd v Minister of Environmental Affairs
[2004] ZACC 15
;
2004 (4) SA 490
(CC).
19
Bato
Star
(CC)
para 32.
20
Bato
Star
(CC) para 35.
21
Bato
Star
(CC) para 25.
22
Bato
Star
(CC) para 44 where
R v Chief Constable of Sussex, ex
parte International
Trader’s Ferry Ltd
[1998] UKHL 40
;
[1999] 1 All
ER 129
(HL) was quoted and said to provide “sound guidance”
in determining what constituted reasonable action of an
administrative
decision-maker under PAJA.
23
Bato
Star
(CC) para 54.
24
As
Schutz JA said in
Minister of Home Affairs and Tourism &
others v Phambili Fisheries (Pty) Ltd & Another
;
Minister
of Environmental Affairs and Tourism & others v Bato Star
Fishing (Pty) Ltd
2003 (6) SA 407
(SCA) para 50 ‘judicial
deference does not imply judicial timidity or an unreadiness to
perform the judicial function’.
O’Regan J agreed with
this statement. (
Bato Star
(CC) 46.)
25
Ngcobo
J in
Bato Star
(CC) para 75.
26
Ngcobo
J in
Bato Star
(CC) para 104.
27
Ngcobo
J in
Bato Star
(CC) para 77 et seq.
28
Section
8(1).
29
Section
8(1)
(c)
(ii)
(aa)
.
30
Hoexter
Administrative Law
at
552.
31
Johannesburg
City Council v Administrator, Transvaal
1969
(2) SA 72 (T).
32
At
76E-G.
33
At
77D.
34
Gauteng
Gambling Board v Silverstar Development Ltd
&
others
2005 (4) SA 67
(SCA) para 28.
35
Section
33(1) of the Constitution provides: “Everyone has the right to
administrative action that is lawful, reasonable
and procedurally
fair.”
36
Commissioner,
Competition Commission v General Council of the Bar of South Africa
& others
2002 (6) SA 606
(SCA)
para 14.
37
Id.
38
Gauteng
Gambling Board v Silverstar Development Ltd & others
2005 (4) SA 67
(SCA). Also see
Minister
of Enviromental Affairs and Tourism & others v Phambili
Fisheries (Pty) Ltd; Minister of Enviromental Affairs and
Tourism &
others v Bato Star Fishing (Pty) Ltd
2003
(6) SA 407
(SCA) paras 47 -50.
39
Commissioner,
Competition Commission
para 15.
40
Protea
Assurance Co Ltd v Matinise
1978 (1)
SA 963
(A) at 976H;
Minister of Prisons
and another v Jongilanga
1985 (3) SA
117
(A) at 124B.
41
See
Attorney-General, Eastern Cape v Blom
1988 (4) SA 645
(A) at
670
D – E.
42
1902
TS 216 223-224.
43
Fourie
v Cilliers
1978 4 SA 163
(O) at 166 B - D.
44
S
ee
Flemming v Flemming
1989
(2) SA 253
(A) at 262B-263A;
45
Per
Eloff AJP writing for the full bench in
Hammond-Tooke
v Stadsklerk van Pretoria
1989 (3) SA
977
(T) at 990E – G.