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[2010] ZASCA 81
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SA Metal & Machinery Co (Pty) Ltd v S (398/09) [2010] ZASCA 81; 2010 (2) SACR 413 (S (28 May 2010)
THE
SUPREME COURT OF APPEAL
REPUBLIC
OF SOUTH AFRICA
JUDGMENT
In the matter:
Case No: 398/09
S A METAL & MACHINERY CO (PTY)
LTD
Appellant
and
THE STATE Respondent
Neutral citation:
SA Metal &
Machinery Co (Pty) Ltd v S
(398/09)
[2010]
ZASCA 81
(28 May 2010)
Coram:
NAVSA,
VAN HEERDEN et BOSIELO JJA
Heard:
10 MAY 2010
Delivered:
28 MAY
2010
Summary:
Criminal
law – Corporate accused – whether the conviction of the
corporate accused based on the conduct of employees
other than those
expressly mentioned in the charge-sheet
is
correct – whether the State has proved beyond reasonable doubt
that the appellant lacked reasonable cause for the belief
as required
by s 37(1)(b) of the General Law Amendment Act 62 of 1955 –
whether evidential burden of raising a reasonable
doubt in relation
to reasonable cause discharged by accused.
ORDER
On appeal from: South Gauteng High Court (Satchwell J et
Coppin AJ sitting as a court of appeal).
1 The appeal is upheld and para 71 of the judgment of
the court below is set aside in its entirety and substituted as
follows:
'The appeal of the second appellant, S A Metal &
Machinery Co (Pty) Ltd, against conviction is upheld and the
conviction and
related sentence are set aside.'
JUDGMENT
BOSIELO JA (
Navsa
et Van Heerden JJA
concurring).
[1] The appellant, SA Metal & Machinery (Pty) Ltd,
was charged in the Regional Court, Kempton Park, in terms of s 332 of
the
Criminal Procedure Act 51 of 1977 (the CPA) together with Mr
Allan de Klerk ('De Klerk'), one of its employees, with theft of:
(i) approximately 2 900 kg of copper
cathodes;
1
(ii) approximately 8 100 kg of Telkom copper wire;
(iii) approximately 17 995 kg of Eskom-marked conductor.
They were also both charged with a
contravention of s 37(1)
2
of the General Law Amendment Act 62 of 1955 (the Act) in respect of
the same items. It was alleged that they had unlawfully acquired
or
received into their possession stolen goods from another person or
other persons. In terms of s 332(2) of the CPA Mr Graham
Barnett was
cited as the representative of the appellant.
[2] At the end of the trial, both the appellant and De
Klerk were acquitted on the counts related to the theft of items (ii)
and
(iii) referred to above. They were also acquitted on the count of
theft of the copper cathodes. They were, however, both convicted
of a
contravention of s 37(1) of the Act in relation to the copper
cathodes. The appellant was sentenced to a fine of R100 000,
half of
which was suspended for five years, whilst De Klerk was sentenced to
a fine of R10 000 or two years' imprisonment. On appeal
to the South
Gauteng High Court (Satchwell J, Coppin AJ concurring), De Klerk’s
conviction and related sentence were set
aside. The appellant’s
appeal against conviction was dismissed. The sentence imposed by the
Regional Court was, however,
set aside and was substituted with a
fine of R80 000, half of which was suspended for five years. The
present appeal, with the
leave of this court, is against the decision
of the South Gauteng High Court dismissing the appellant’s
appeal against conviction.
[3] Before us the issue was whether the court below,
having held that De Klerk rightly believed that the cathodes in
question were
sold to the appellant by Meadon Scrap, whose property
it was or who had sold them with the requisite authority, correctly
concluded
that the appellant did not hold the same belief.
[4] An exposition of the salient facts is necessary. The
appellant is one of South Africa’s leading scrap metal
merchants.
It conducts operations in Elandsfontein, Gauteng and in
Cape Town, the latter location being its headquarters. At all
material
times, De Klerk was employed as a manager at Elandsfontein.
In the course of its daily business activities, the appellant
purchases
and receives scrap metals from a range of registered scrap
metal dealers. The appellant does not purchase scrap metal off the
street.
[5] It is common cause that approximately five weeks
before the incident on which the conviction was based, a truck
carrying 65
tons of copper cathodes was hijacked in Gauteng whilst it
was in the process of delivering its load from Zambia to a purchaser.
The police, acting on information supplied by an informant, called on
De Klerk at the appellant’s Elandsfontein premises
to find out
whether he had any knowledge of the hijacked goods. De Klerk told
them that he had been approached by a scrap metal
dealer who had
offered him 15 tons of cathodes. He had heard rumours about the
hijacking and had rejected the offer. There is a
dispute about
whether De Klerk had told a policeman that he had persuaded his
employer not to purchase stolen goods.
[6] It is clear from the evidence of witnesses who have
extensive experience in the scrap metal industry that, although
copper cathodes
sometimes find their way into the open market, for
example, by way of a police auction or the sale of surplus stock,
such occurrences
are the exception rather than the rule.
[7] The uncontested evidence of Barnett and De Klerk was
that on a number of occasions they had, on behalf of the appellant,
purchased
copper cathodes from certain registered dealers, without
incident. In one instance they were able to demonstrate that the
copper
cathodes they had purchased had been sourced from a police
auction in Zambia. It is not per se unlawful to purchase or possess
copper cathodes. Some of the dealers from which they purchased these
cathodes were importers of scrap metal.
[8] During or about April 2003, De Klerk, who conducts
purchases and administers sales mostly telephonically from an office
above
ground level at the appellant’s Elandsfontein premises,
was advised by his yard foreman, Mr Hans Visser ('Visser'), that
the latter had received copper cathodes from a scrap dealer
registered with the appellant, namely, Meadon Scrap. Because there
was a container already loading copper for export, De Klerk
telephoned Mr Mark Sellier ('Sellier), who was responsible for
foreign
sales and who was stationed at head office, to enquire
whether he could load the cathodes into the container. He received an
answer
in the affirmative. Consequently, De Klerk instructed Visser
to load the cathodes into that container.
[9] Visser was primarily responsible for receiving,
inspecting and sorting the scrap metal purchased from registered
dealers. De
Klerk had confidence in Visser as the two had worked
together successfully for many years. De Klerk did not personally
inspect
the cathodes and did not link them to the enquiry by the
police more than a month earlier. It is uncontested that the
appellant
and Meadon Scrap conduct many business transactions with
each other on an ongoing basis.
[10] It is common cause that containers bearing the
cathodes in question were intercepted and impounded by the police at
Durban
harbour and that those cathodes were part of the consignment
hijacked in Gauteng, referred to earlier.
[11] The court below took into account that s 37(1) of
the Act required the State to prove that an accused was found in
possession
of goods which were acquired otherwise than at a public
sale and that the goods had been stolen. In seeking a conviction the
State
had relied upon the evidential provision in s 37(1)(b) of the
Act. Satchwell J rightly stated that this evidential provision only
operated in the absence of evidence to the contrary which raises a
reasonable doubt. The learned judge rightly rejected the evidence
of
an employee of the appellant, Mr Ngobeni, who had testified that he
had witnessed a number of cathodes hidden within the appellant’s
Elandsfontein premises. His evidence was contradictory and
unreliable.
[12] Satchwell J had regard to De
Klerk’s evidence, in terms of which he had placed himself in
possession of the cathodes.
She took into account that Visser’s
report to De Klerk was unchallenged. The learned judge considered, in
favour of De Klerk
that he had, on a previous occasion, rejected an
offer of cathodes from a doubtful source. She concluded that the
evidential burden
of raising a reasonable doubt in relation to
reasonable cause had been discharged and consequently set aside his
conviction and
related sentence.
3
[13] In respect of the case against the appellant the
court below rejected the submission on its behalf, that since the
State’s
case against the appellant was dependant upon the
actions of De Klerk and since he was innocent, so too should be the
appellant.
The court below had regard to s 332 of the CPA which
provides that any act performed by a servant of a corporate body in
the exercise
of his or her powers shall be deemed to have been
performed by the corporate body. The court reasoned that the
appellant had taken
possession of the cathodes even before De Klerk
was informed of their presence and that they must have been unloaded,
weighed and
sorted before Visser made his report. Satchwell J stated
that although Visser’s report to De Klerk is hearsay it did
lead
to his state of mind and he could thereby resist liability. The
learned judge reasoned that the appellant could not similarly rely
on
what was told to De Klerk by Visser, who was not a witness. She
concluded that since no other employee at the Elandsfontein
premises
had testified about the receipt of the cathodes the appellant had not
produced any evidence that challenged the statutory
presumption
referred to above and consequently dismissed the appeal by the
appellant.
[14] The problem is that in seeking to hold the
appellant liable the State, in the charge sheet, expressly and
exclusively relied
on the actions of De Klerk and Mr Barnett. It is
common cause that Mr Barnett was not involved in the transaction and
at material
times was stationed in Cape Town.
[15] Before us, in order to overcome this problem, the
State sought an amendment to the charge sheet to include employees of
the
appellant other than De Klerk. The respondent relied on section
86 of the CPA which provides as follows:-
(1) Where a charge is defective for the want of any
essential averment therein, or where there appears to be any variance
between
any averment in a charge and the evidence adduced in proof of
such averment, or where it appears that words or particulars that
ought to have been inserted in the charge have been omitted
therefrom, or where any words or particulars that ought to have been
omitted from the charge have been inserted therein, or where there is
any other error in the charge, the court may, at any given
time
before judgment, if it considers that the making of the relevant
amendment will not prejudice the accused in his defence,
order that
the charge, whether it discloses an offence or not, be amended, so
far as it is necessary, both in that part thereof
where the defect,
variance, omission, insertion or error occurs and in any other part
thereof which it may become necessary to
amend.
(2) The amendment may be made on such terms as to an
adjournment of the proceedings as the court may deem fit.'
[16]
The
State
had
identified De Klerk as
the
employee or director of the appellant on whose conduct it relied for
holding the appellant liable. At no stage, before or during
the
trial, was there any indication that the net was being cast wider.
The appellant tailored its defence accordingly. To allow
an amendment
at this stage would cause very real prejudice, and would be
subversive of the notion of a fair trial as embodied in
section
35(3)(a) and (i) of the Constitution. The amendment is consequently
refused, see
R v
Metal Salvage Co (Pty) Ltd & others
1953
(4) SA 257
(C) at p 265C-H and
Musa
J Moloi & others v Minister for Justice and Constitutional
Development & others
(as
yet unreported) (CCT 78/09)
[2010] ZACC 2
(4 February 2010) paras
10–20.
[17] Having rightly concluded that it could not be said
that De Klerk did not have reasonable cause to believe that he could
lawfully
purchase the copper cathodes in issue and further that the
entity which sold them was either the owner or had had lawful
authority
to sell or dispose of them, the learned judge erred in
convicting the appellant.
[18] In the result, the appeal is upheld and para 71 of
the judgment of the court below is set aside in its entirety and
substituted
as follows:
‘
The appeal of the second appellant, SA Metal &
Machinery Co (Pty) Ltd, against conviction is upheld and the
conviction and related
sentence are set aside.’
___________________
L O BOSIELO
JUDGE OF APPEAL
APPEARANCES:
For appellant: O L Rodgers SC
Instructed by: Snitchers Attorneys
c/o Earle Friedman Attorney, Johannesburg
Lovius Block, Bloemfontein.
For respondent: F Mohamed
Instructed by: Director of Public
Prosecutions, Johannesburg
Director of Public Prosecutions, Bloemfontein.
1
A copper cathode is a large copper plate usually weighing more than
100 kg and having a copper purity content of approximately
99 per
cent. Zambia is one of the world’s leading manufacturers and
exporters of copper cathodes. It appears that cathodes
from
different Zambian mines have a distinctive appearance related to the
particular mine’s manufacturing process. It also
appears that
the top of a stack of sheets is identified by the particular mine
with specific markings. Copper cathodes appear
to be a sought after
commodity on the London Metals Exchange.
2
Section 37(1) of the Act provides:
‘
(a)
Any
person who in any manner, otherwise than at a public sale, acquires
or receives into his possession from any other person
stolen goods,
other than stock or produce as defined in s 1 of the Stock Theft
Act, 1959, without having reasonable cause for
believing at the time
of such acquisition or receipt that such goods are the property of
the person from whom he or she receives
them or that such person has
been duly authorized by the owner thereof to deal with or to dispose
of them, shall be guilty of
an offence and liable on conviction to
the penalties which may be imposed on a conviction of receiving
stolen property knowing
it to have been stolen except in so far as
the imposition of any such penalty may be compulsory.
(b)
In
the absence of evidence to the contrary which raises a reasonable
doubt, proof of such possession shall be sufficient evidence
of the
absence of reasonable cause.’
3
Although the owner of Meadon Scrap had denied selling the cathodes
to the appellant it should be borne in mind that he was himself
facing prosecution in relation to other matters and it is unsafe to
accept his evidence in this regard. Also, he conceded in
cross-examination that he had five dealerships trading as Meadon
Scrap and that he would not necessarily know of each and every
delivery that went in and out of his business.