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[2021] ZAGPJHC 505
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Gaetal (Pty) Ltd v The University of Johannesburg and Others (7021/21) [2021] ZAGPJHC 505 (7 October 2021)
IN
THE HIGH COURT of SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
REPORTABLE:
No
OF
INTEREST TO OTHER JUDGES: No
REVISED:
Date:
6/10/21
CASE
NO: 7021/21
In
the matter between:
GAETAL
(PTY)
LTD
Applicant
and
THE
UNIVERSITY OF JOHANNESBURG
First Respondent
THE
COUNCIL: UNIVERSITY OF JOHANNESBURG
Second Respondent
THE
MANAGEMENT EXECUTIVE COMMITTEE:
UNIVERSITY
OF JOHANNESBURG
Third Respondent
Coram:
Fourie AJ
Heard
on
: 6
August 2021
Delivered:
7 October 2021
Summary:
Promotion of Administrative Justice Act 3 of 2000
, applied.
University, in administering public funding for student
accommodation, acting contrary to its own policy on accreditation
of
private student accommodation providers. Decision not to consider
applicant as a provider for the 2021 academic year set aside
on
review. University directed to consider the application.
JUDGMENT
Introduction
1.
This is a review application, brought in terms of the Promotion
of
Administrative Justice Act 3 of 2000 (“PAJA”), in which
the applicant, a property development company, seeks to
challenge the
decision of the first respondent (“the University”), to
not consider new buildings for approval in terms
of its relevant
policies, for the 2021 academic year. The University opposes the
application.
2.
It is common cause between the parties that PAJA applies to
the
impugned decision. This being the default gateway to constitutional
review, it is not necessary to consider whether the impugned
decision
falls foul of the broader constitutional principle of legality.
Background
3.
The University endeavours to provide access to accommodation
to
students who require it. Only a small fraction of these students can
be accommodated at the on-campus residences, that are owned
and run
by the University. The remainder are referred to approved private
landlords for off-campus accommodation. The aim of approving
private
providers of student accommodation is to ensure an adequate standard
of accommodation, suitable for students, is maintained.
4.
Students who qualify for State funding of their studies via
the
National Student Financial Aid Scheme (“NFSAS”), also
qualify, where required, for a contribution of around R45,000
per
annum to their accommodation costs. This creates a strong commercial
incentive for private property developers and smaller
landlords to
obtain accreditation from a university, as it effectively guarantees
the receipt of rental income.
5.
NFSAS relies on the University to ensure that public funds are
not
misspent. The University (and any other learning institution
receiving NFSAS-funded students) is obliged to take the necessary
steps to ensure a sufficient supply of student accommodation that
meets minimum standards set by Government, and to ensure that
student
accommodation monies are not misspent. In practice, these are onerous
and wide-ranging responsibilities, which the University
is not, by
its nature, well-suited to carry out.
6.
With the high demand for tertiary education, the University
would
generally be under pressure to ensure that there were adequate
numbers of beds available in approved private accommodation,
for the
following financial year. The University developed a policy that
regulates what it refers to as “POSA’s”,
an acronym
for “Providers of Student Accommodation”. This policy
also regulates applications for new providers or new
buildings by
existing providers.
7.
The applicant is part of a group of companies that develop student
accommodation buildings. It’s owners acquired a building near
the University’s City Campus in Doornfontein, Johannesburg,
during 2019, and set about converting it to meet the required
standards for student accommodation, with the aim of applying for
and
obtaining approval by the University during 2020, thus enabling it to
advertise to and attract students whose accommodation
fees would be
funded by NFSAS, starting with the 2021 academic year. The applicant
invested approximately R90-million in converting
the building to meet
the required standards.
8.
The spread of the Covid-19 pandemic and the lockdown in South
Africa
that commenced in March 2020, disrupted the academic program of the
University, as most in-person teaching had to be suspended.
Some 18
months later, things have still not returned to normal, with many
courses and lectures proceeding via online channels,
and it is not
clear when or whether the amount of privately provided beds for
students will recover to previous levels.
9.
As at mid-2020, when the University would normally commence
the
process of inviting applications for new buildings and accommodation
providers, it was apparent that the demand for student
accommodation
had plummeted with the onset of lockdown, and was unlikely to fully
recover in the short term. A decision was made
by the second
respondent, the Management Executive Committee of the University
(“the MEC”), at a meeting held on 28
July 2020, not to
consider new applications for 2021, but to simply continue to use
existing providers of student accommodation.
10.
It is this decision which the applicant seeks to set aside on review.
In addition,
the applicant seeks an order directing the University
(via the MEC) to
consider
its application for approval, in
terms of the Policy, in respect of the
2021
academic year.
Mootness
11.
The 2021 academic year will be over in approximately two months. The
University
argues that the issue is therefore moot, as a judgment
will have no practical effect either way. The applicant is hardly
likely
to attract new residents for the current academic year. The
University is in the process of revising the Policy, as it has proven
to be problematic in various respects, and claims that the new policy
will apply in respect of the 2022 academic year, thus rendering
a
judgment on the current Policy almost immediately moot.
12.
The applicant argues that the matter is not moot, the main reasons
being that
it has invested significant capital in renovating the
building to the appropriate standards, and has provided accommodation
to
some 349 NFSAS-funded students during this year. If the applicant
can obtain accreditation, even after the event, it can proceed
to
recover accommodation fees (in excess of R12 million for the 2021
academic year) from NFSAS. The commercial consequences of
the dispute
are therefore by no means trivial. The applicant expresses doubt that
the University will issue a new policy in the
near future.
13.
In my view the matter is clearly not moot. The outcome of this
application will
still have real-world consequences between the
parties. It may also impact on assessments for the 2022, as the
policy in question
is still in force (although I was informed that it
is in the process of being reviewed and is likely to be amended).
The
applicable policies
14.
The
University’s Policy
[1]
(“the Policy”) regulates the appointment of providers of
student accommodation for a particular calendar year. Providers
apply
per building and not on a blanket basis. Approvals only cover a
particular year.
15.
The Policy aims to “
offer an enriching student-friendly
learning and living experience, by providing Students who enter into
contracts with Service
Providers (“SPs”) for
accommodation in Privately-owned Student Accommodation (“POSA”)
subject to the Policy
with adequate, fit-for-purpose accommodation of
reasonable quality, and enable them to enjoy learning and living
environments that
promote academic success
.”
16.
The Policy
also seeks to give effect to the requirements set by the Minister of
Higher Education in a policy
[2]
,
duly promulgated in terms of section 3 of the Higher Education Act,
on minimum norms and standards for student housing at public
universities (“the Minimum Standards Policy”), which sets
specific requirements for acceptable privately-owned student
accommodation.
17.
The Policy applies to all prospective and current accommodation
service providers.
It sets out the process for applications for
accreditation. In brief:
17.1.
The University sets the opening and closing dates for applications,
on an annual basis.
17.2.
Applicants are bound by the terms of the Policy.
17.3.
Applicants must complete the relevant application forms and provide
information required by the University, and pay a non-refundable
application fee.
17.4.
Only applications that comply fully with the Policy will be
considered for accreditation.
17.5.
Applications are considered on the documents, and qualifying
buildings will then be inspected to ensure compliance with minimum
housing standards.
17.6.
Four possible outcomes are envisaged:
17.6.1.Approval
of the service provider and the particular building/s applied for,
subject to conclusion of a contract with the
University;
17.6.2.Limited
approval with corrections to be carried out to obtain full approval;
17.6.3.The
application is declined;
17.6.4.Declined
and blacklisted (from future applications).
18.
The Policy provides for an appeal process against a decision to
decline
an application, with the decision of the appeals panel being
final.
19.
An approved service provider is then entitled to market itself
to the
student community as being approved by the University.
20.
Of critical importance is that approved service providers
qualify for
funding from NSFAS, the National Student Financial Aid
Scheme, funded and operated by the National Department of Higher
Education
and Training, and aimed at providing study loans to
deserving students for tertiary education. NSFAS support includes the
funding
of student accommodation.
21.
In essence, the University is tasked with ensuring compliance
with housing
standards on behalf of NSFAS and the
Minister/Department, by regulating the providers of student housing.
Providers that qualify
in terms of the Policy, will receive rental
payments from NSFAS for qualifying students that take up
accommodation with an approved
service provider. This is obviously a
critical commercial incentive for private accommodation providers to
compete for accreditation.
22.
Lastly, the Policy allows for deviations from its own terms, on
approval
from the MEC.
Timeline
of key events
23.
The key facts in this matter are largely common cause, and can be
briefly recorded.
24.
On 22 May 2020, the University addressed email correspondence to its
various
accommodation service providers, inviting applications for
2021. The application process entails registration on an online
system,
uploading all relevant documents, and paying an
administration fee.
25.
The applicant duly submitted its application and paid the
application
fee.
26.
On 22 July 2020, the University communicated that applications
would close
at the end of September 2020.
27.
On 28 July 2020, unbeknownst to the applicant and other
prospective accommodation
providers, the MEC apparently decided not
to continue with assessment of applicants for 2021, but rather to
continue to use current
accommodation service providers in 2021. The
recordal of the purported decision in this regard reads as follows:
(refer
to PDF)
28.
It bears mentioning that the “report and action list of
the MEC
Strategic Breakaway of 8 June 2020” does not deal with
the 2021 accreditation process at all. The only reference to the
purported
decision is in para 1 b).
29.
On 28 July 2020, Dr Nolitha Vukuza (Senior Executive Director:
Student
Affairs & University Relations) addressed an email to
several colleagues, in which the decision of the MEC of 27 July 2021
was communicated as follows:
“
Dear
Colleagues
Please
note the following from the MEC: No new POSA accreditations for 2021,
the sentiment is to use the 2020 already accredited
ones. It must be
emphasized that students are not to be left stranded because of this
directive. As and where there are those providers
that will no longer
participate but are accredited improvisation must be done. What it
means therefore is that you should determine
their availability for
2021. Things are poised to change as we foresee a dip in student
enrolment because of online learning.”
30.
On 17 August 2020, Godfrey Helani (“Helani”),
Senior Director:
Student Affairs submitted a recommendation to the
MEC on student accommodation, in the following terms:
(Refer
to PDF)
31.
On 19 August 2020, in response to a routine email inquiry on
outstanding
documents in the submission process, the applicant’s
representative (Mr Jennings) was informed by the University’s
Mr Molokwane, as follows:
“
I
would like to acknowledge the receipt of your Nano New Development.
The University has taken a decision not to increase the number
of
beds for 2021. I will provide you with more information tomorrow
about the whole accreditation process for 2021.”
32.
On 24 August 2020, Mr Jennings responded to Mr Molokwane’s
email:
“
I
am following up on the additional information you advised would be
forthcoming. As you can imagine, we are quite concerned, as
we are
deep in the process of a multi-million Rand development, so would
really like to understand further regards your information
on the
2021 applications.”
33.
In response, Mr Molokwane informed Mr Jennings that he was
following up
with University management regarding “…
MEC
directives and guidelines for 2021 accreditation process
.”.
34.
On 24 August 2020, the associations addressed a collective letter to
Mr Helani,
containing responses to issues raised at a meeting held
during July 2020. It is apparent from the content of this letter that
the
industry was not aware of the University’s purported
decision of 27 July 2020, not to engage any new service providers for
2021.
35.
On 25 August 2020, the MEC met, and resolved as follows:
(Refer
to PDF)
36.
During September and October 2020, Mr Jennings addressed
several queries
regarding the applicant’s application for
accreditation. He did not receive a response.
37.
On 3 November 2020, Mr Helani addressed an email to
accommodation service
providers, their representatives and the
associations, in which he recorded:
(Refer
to PDF)
38.
On 17 November 2020, a meeting was held between industry and
University representatives.
There was still widespread confusion
about the status of the 2021 accreditation applications. Apparently,
during the course of
this meeting, a University representative
mentioned that the 2021 applications would not be considered.
39.
This prompted Mr Jennings to address a direct query on email on
18 November
2020, in which he sought clarity on this statement. The
response was to the effect that the issue would be taken to executive
management
for consideration, and thereafter providers would be
updated.
40.
In early December 2020, at a further industry meeting, the
University
finally informed industry representatives that it would
not consider applications for 2021, but would continue using existing
accommodation
service providers. This prompted an outcry, and the
University undertook to consider submissions prior to implementing
this decision.
Shortly thereafter, in a response to submissions, Mr
Helani indicated that the University would consider new applications
if the
existing suppliers could not meet demand, or if suppliers had
their accreditation withdrawn due to non-compliance with relevant
rules and standards.
41.
In December 2020, amidst the confusion, industry
representatives called
on the University to make a final decision
about the 2021 applications. No response was forthcoming. In
mid-January 2021, the applicant’s
attorneys addressed
correspondence to the University, and demanded a formal response to
the applicant’s application for 2021.
42.
By 19 January 2021, no response had been received, and the
applicant indicated
by way of attorney’s correspondence that it
sought to exercise its right of appeal in terms of the policy. On 30
January
2021, the University finally provided a substantive response,
along the following lines:
42.1.
The MEC decided on 28 July 2020, not to consider any applications for
2021 student accommodation providers;
42.2.
The MEC was empowered, in terms of clause 27 of the Policy, to
deviate from the Policy.
42.3.
The decision had been communicated to the applicant’s
representative on 19 August 2020.
42.4.
Given the MEC’s decision, there was no scope for an appeal by
the applicant.
43.
In a later letter, the University’s attorneys
supplemented the reasons
for the MEC decision of 28 July 2021, with
two additional reasons:
43.1.
Problems with sub-standard accommodation by existing service
providers needed to be addressed before new service providers
could
be considered.
43.2.
Due to covid-19, there was an oversupply of student accommodation
based on supply and demand figures for 2020.
44.
The applicant then instituted review proceedings, initially as
a semi-urgent
application, which later morphed into this application.
The University provided a review record and opposed the application.
45.
In supplementary papers, the applicant raised the fact that the
University had
acted inconsistently by approving certain new
accommodation service providers for 2021. The University’s
explanation is that
the official who appointed these service
providers, acted without authority, and is facing disciplinary
action.
The
factual grounds for the PAJA challenge to the decision not to
consider applications for 2021 service providers
46.
Counsel for both parties confirmed that the impugned decision
constitutes
administrative action, and that the default review
pathway under PAJA applies. The key issue for determination is
therefore whether,
on the facts, there are sufficient grounds
established to review and set aside the impugned decision under PAJA.
47.
I deal only with what I regard, for purposes of this judgment,
as the
critical grounds of review pleaded by the applicant. In
essence, the key factual grounds on which the applicant seeks to
review
the impugned decision, are:
47.1.
No decision was taken by the MEC on 28 July 2020, to not consider new
applications. Alternatively:
47.2.
In making the impugned decision, the University from its own Policy
in key respects, outside of its powers to do so;
47.3.
The failure to provide the applicant with the opportunity to make
submissions prior to it taking the impugned decision, or
to provide
the applicant with reasons for the impugned decision within a
reasonable time of taking it;
47.4.
The initial invitation to submit applications, acceptance of
application documents and fees, and failure to advise the applicant
of the impugned decision until months after the fact, created a
legitimate expectation that the applicant’s application would
be considered.
The
factual basis of the University’s defence
48.
The University pleads that the impugned decision was in fact taken at
the MEC
meeting on 28 July 2020, that it was communicated to the
applicant by email during August 2020, and that the decision was
“confirmed”
at the MEC meeting of 25 August 2020.
49.
In its answering affidavit, the University advanced the
following reasons
for the impugned decision:
49.1.
Traditionally there was an undersupply of student accommodation. This
reversed in 2020, and the anticipated oversupply of
beds provided by
private accommodation providers was likely to continue.
49.2.
The MEC is established in the Institutional Statute of the
University. The MEC is tasked with assisting the Vice-Chancellor
and
Principal in the administration and management of the University. It
is a senior decision-making body.
49.3.
Various serious irregularities had emerged over the years in the
provision of student accommodation by private service providers.
For
example, investigations had shown that certain providers were
defrauding the NFSAS by overcharging students, sometimes in cahoots
with students.
49.4.
The University administration is not adequately staffed or geared to
manage the process of appointing, vetting and monitoring
the
provision of private student accommodation on the scale required. It
does the best it can, with limited expertise and resources
available.
49.5.
The Policy is no longer fully fit for purpose, and requires
large-scale revision. This process is currently underway.
49.6.
The Covid-19 pandemic has had a drastic impact on the University’s
operations. One impact has been that the need for
student
accommodation has drastically declined. This exposed other abuses of
the NFSAS, such as students who did not vacate their
NFSAS-funded
accommodation, but did not pay over the rental (which they received
from NFSAS as part of their grant) to the accommodation
provider.
49.7.
The University was concerned that the oversupply of accommodation
might increase the levels of irregularities and abuses of
the
State-funded student accommodation scheme. At a strategic breakaway
session in June 2020, the entire system of administration
of private
suppliers of student accommodation needed to be revised.
49.8.
Management took the view that the move towards increased online
learning and virtual classes, which was rapidly accelerated
by the
onset of the Covid-19 pandemic and related lockdowns, was likely to
become permanent, thus permanently reducing the ongoing
need for
student accommodation near to campus.
49.9.
These views informed the decision, recorded in the minute of the MEC
meeting on 28 July 2020, that no new accommodation service
providers
would be considered for the 2021 academic year.
49.10.
This decision was promptly communicated
to management,
accommodation service providers and their representative bodies. The
applicant was informed of this decision on
19 August 2020, in the
email quoted above. On 3 November 2020, the University again
communicated its clear intention to use existing
accredited
accommodation service providers in the following year, and not to
increase the number of beds for the following year.
At the same time,
the University reserved the right to monitor service providers, and
to withdraw their accreditation in the event
of non-compliance with
applicable norms, standards and rules.
50.
Affected service providers were subsequently given the
opportunity to
make representations on the 2021 accreditation issue,
which were duly considered by the University.
Determination
of key factual dispute
51.
The only real dispute of fact that requires determination, is
whether
the impugned decision was in fact taken by the MEC at the
meeting of 28 July 2020. The applicant disputes this, on the basis
that
the minute of this meeting does not reflect that the impugned
decision was taken, as it was not recorded as a resolution
(“resolved”).
52.
Inasmuch as this constitutes a dispute of fact, the direct
evidence of
the University, which confirms that the decision was in
fact taken by the MEC in this meeting, despite the error in how it
was
recorded in the minute, will prevail, on the application of the
well-known
Plascon-Evans
test. In any event, this dispute is
more apparent than real. The decision by the University not to
consider applications for accreditation
for 2021 underlies the review
application before me. That the decision was taken, albeit that there
is some confusion apparent
from the papers as to when exactly it was
taken, is common cause, and I find on the facts that the impugned
decision was taken
by the MEC at the meeting of 28 July 2020.
PAJA
– relevant provisions on procedural fairness and application to
the facts
53.
Section 3 of PAJA regulates procedural fairness in
administrative action
that does not involve the broader public. It
reads:
“
3.
Procedurally fair administrative action affecting any person.—
(1)
Administrative action which materially and adversely affects the
rights or legitimate expectations of any person must be procedurally
fair.
(2)
(a) A fair administrative procedure depends on the circumstances of
each case.
(b)
In order to give effect to the right to procedurally fair
administrative action, an administrator, subject to subsection (4),
must give a person referred to in subsection (1)—
(i)
adequate notice of the nature and purpose of the proposed
administrative action;
(ii)
a reasonable opportunity to make representations;
(iii)
a clear statement of the administrative action;
(iv)
adequate notice of any right of review or internal appeal, where
applicable; and
(v)
adequate notice of the right to request reasons in terms of section
5.
(3)
In order to give effect to the right to procedurally fair
administrative action, an administrator may, in his or her or its
discretion, also give a person referred to in subsection (1) an
opportunity to—
(a)
obtain assistance and, in serious or complex cases, legal
representation;
(b)
present and dispute information and arguments; and
(c)
appear in person.
(4)
(a) If it is reasonable and justifiable in the circumstances, an
administrator may depart from any of the requirements referred
to in
subsection (2).
(b)
In determining whether a departure as contemplated in paragraph (a)
is reasonable and justifiable, an administrator must take
into
account all relevant factors, including—
(i)
the objects of the empowering provision;
(ii)
the nature and purpose of, and the need to take, the administrative
action;
(iii)
the likely effect of the administrative action;
(iv)
the urgency of taking the administrative action or the urgency of the
matter; and
(v)
the need to promote an efficient administration and good governance.
(5)
Where an administrator is empowered by any empowering provision to
follow a procedure which is fair but different from the provisions
of
subsection (2), the administrator may act in accordance with that
different procedure.”
54.
The “empowering provision” referred to in section 3
is defined
in PAJA as “…
a law, a rule of common law,
customary law, or an agreement, instrument or other document in terms
of which an administrative action
was purportedly taken
.”
In this matter, the empowering provision is clearly the Policy, being
the instrument that regulates the entirety of the
relations between
the University and prospective and current private accommodation
service providers.
55.
It seems obvious (and was not seriously disputed) that the
impugned decision
adversely affected the rights or legitimate
expectations of the applicant. The procedural fairness requirements
in section 3 therefore
apply.
56.
In my view, the University failed entirely to comply with the
bare minimum
requirements of procedurally unfair administrative
action, for the following primary reasons:
56.1.
It had invited new applications for 2021, in terms of the Policy, in
May 2020. In July 2020, it had communicated the closing
date for
applications to interested parties.
56.2.
The University did not give any sign or notice that it was
contemplating the suspension of the 2021 application process, prior
to the impugned decision being taken. As a result, interested parties
such as the applicant were denied any opportunity (let alone
a
reasonable opportunity) to make representations prior to the impugned
decision being taken.
56.3.
The impugned decision was not clear, and neither was it
properly or timeously communicated to affected parties, including
the
applicant:
56.3.1.Mr
Molokwane’s email of 19 August 2020 states that “
The
University has taken a decision not to increase the number of beds
for 2021
.” In my view, this statement does not clearly
imply that no new service providers would be considered for 2021,
particularly
as, in terms of the Policy, the approved accommodation
for 2020 was not simply automatically approved for 2021.
56.3.2.Mr
Molokwane’s subsequent undertakings to provide further details
on the “
entire accreditation process
” after
consultations with management does not convey the message that a
final decision not to consider any applications for
2021, has been
taken.
56.3.3.The
timeline indicates that as late as December 2020, there was still no
clarity on whether 2021 applications would be considered
at all.
56.4.
The Policy provides for the right of internal appeal against the
refusal of accreditation. PAJA requires that affected parties
be
advised of such rights. The applicant gave notice of its intention to
exercise its right of appeal. This was disregarded, on
the spurious
reasoning that as the applicant’s application had not been
refused, the right to appeal had not been triggered.
The University,
having invited applications for 2021 accommodation in terms of the
Policy; and having received an application and
application fee from
the applicant, before deciding not to consider any such applications,
cannot now assert with any credibility
that it did not refuse the
application, but simply decided not to consider it and all other
similar applications. In my view, refusal
after consideration, and
refusal to consider are essentially the same result, and the internal
right of appeal lies against both.
PAJA
– relevant provisions on substantive fairness, and application
to the facts
57.
Section 6 of PAJA reads, in relevant part:
“
6
Judicial review of administrative action.—
(1)
Any person may institute proceedings in a court or a tribunal for the
judicial review of an administrative action.
(2)
A court or tribunal has the power to judicially review an
administrative action if—
(a)
the administrator who took it—
(i)
was not authorised to do so by the empowering provision;
(ii)
acted under a delegation of power which was not authorised by the
empowering provision; or
(iii)
was biased or reasonably suspected of bias;
(b)
a mandatory and material procedure or condition prescribed by an
empowering provision was not complied with;
(c)
the action was procedurally unfair;
(d)
the action was materially influenced by an error of law;
(e)
the action was taken—
(i)
for a reason not authorised by the empowering provision;
(ii)
for an ulterior purpose or motive;
(iii)
because irrelevant considerations were taken into account or relevant
considerations were not considered;
(iv)
because of the unauthorised or unwarranted dictates of another person
or body;
(v)
in bad faith; or
(vi)
arbitrarily or capriciously;
(
f ) the action itself—
(i)
contravenes a law or is not authorised by the empowering
provision; or
(ii)
is not rationally connected to—
(aa)
the purpose for which it was taken;
(bb)
the purpose of the empowering provision;
(cc)
the information before the administrator; or
(dd)
the reasons given for it by the administrator;
(g)
the action concerned consists of a failure to take a decision;
(h)
the exercise of the power or the performance of the function
authorised by the empowering provision, in pursuance of which the
administrative action was purportedly taken, is so unreasonable that
no reasonable person could have so exercised the power or
performed
the function; or
(i)
the action is otherwise unconstitutional or unlawful.
…”
58.
I have already found that the impugned decision was
procedurally unfair.
On this basis alone, it may be set aside on
review. I briefly deal with other material challenges that in my view
require consideration.
59.
As noted above, the “
empowering provision
” that
applies is the Policy. The Policy does not grant the MEC the power to
make the impugned decision. On the face of it,
the impugned decision
stands to be set aside because:
59.1.
s6(a)(i) - “
the administrator who took it was not authorised
to do so by the empowering provision
”;
59.2.
s6(2)(f)(i) – “
the action itself … is not
authorised by the empowering provision
”. (This provision
also puts paid to the University’s assertion that as the MEC
simply decided not to consider any new
application in respect of
2021, it did not ‘refuse’ the applicant’s
application. The Policy does not give the
University the power not to
consider applications. In any event, the failure to take a decision
(on an application for accreditation)
would in itself be susceptible
to review).
60.
The University argues that this is not the case, as the Policy itself
provides
the MEC with the discretion to deviate from its terms.
Clause 27 of the Policy provides that “
The MEC may approve
deviations from the Policy on good cause shown
.”
61.
On the facts, it does not appear that the MEC was faced with
any kind
of application to approve a deviation from the Policy when
it took the impugned. It decided of its own accord to simply not
consider
any applications for new accommodation for 2021. It did so
for reasons which, at least at the time (the reasons were
significantly
bolstered after the fact, a reviewable irregularity in
itself), were clearly not relevant to the issue. After all,
irregularities
in the services provided by existing accommodation
providers hardly justifies the decision to not consider new service
providers.
62.
It also did so shortly after having initiated the new process
and having
invited applications for 2021, thus creating the right,
alternatively a legitimate expectation, on the part of prospective
service
providers (including the applicant) that, provided they
jumped through the applicable hoops, their applications for
accreditation
would be considered on their merits, in terms of the
Policy.
63.
I have real doubts as to whether clause 27 of the Policy grants
the MEC
the discretion to disregard the entirety of the portions of
the policy dealing with applications for accreditation. In any event,
even if the discretion is that broad, it cannot lawfully be exercised
on the basis irrelevant considerations, or arbitrarily, which
in my
view it was. The extent of arbitrariness is illustrated by the later
decision to automatically extend the accreditation of
2020 service
providers for 2021, in circumstances where the Policy does not
contemplate any such blanket extension.
64.
Much can be made of the changes over time to the reasons
provided by the
University for the impugned decision. It hardly
bolsters the University’s argument that the decision was
reasonable and procedurally
fair. But given the findings already
made, it is not necessary to deal with this issue in further detail,
suffice to note that
the failure to provide adequate reasons can in
itself render the decision susceptible to review.
Appropriate
relief
65.
In my view, for the reasons set out above, the impugned
decision should
be declared invalid. The next consideration is what
further relief, if any, should be granted. I see no reason why the
default
relief of setting the impugned decision aside should not
follow.
66.
The applicant seeks an order directing the MEC to consider its
application
in terms of the Policy. In my view this is the most
appropriate relief to grant in the circumstances. Although the
reconsideration
will only occur towards the end of (or after) the
conclusion of the 2021 academic year, there are still real commercial
consequences
that will flow from the decision, namely whether the
rental subsidies of NFSAS students who resided in the applicant’s
building
during 2021, can be recovered from the NFSAS. This can only
happen if the applicant is accredited by the University.
67.
In my view the applicant is entitled to the costs of the
application.
I see no compelling reason as to why costs should not
follow the result on these facts. The applicant was treated in a
grossly
unfair and high-handed manner by the University, and had no
choice but to approach the Court for relief. Given the nature of the
proceedings, it would have incurred considerable expenses in
vindicating its rights.
Order
68.
I make the following order:
“
1.
The decision by the first respondent
not to consider the applicant’s application for accreditation
as a new provider of private student accommodation for the 2021
academic year, is reviewed and set aside.
2.
The first respondent is
directed to, within 10 days of granting this order, consider
the
applicant’s application, as contemplated in the applicable
policy, for the accreditation of the building known as Nano
Living
Miller Street, in respect of the 2021 academic year, and to forthwith
communicate its decision to the applicant.
3.
The first respondent is
ordered to pay the costs of this application.
Greg
Fourie
Acting
Judge of the High Court of South Africa
Gauteng
Local Division, Johannesburg
HEARD
ON:
6 August 2021
DATE OF
JUDGMENT:
6 October 2021
FOR THE
APPELLANT:
Adv CC Bester and Adv M Sethaba
INSTRUCTED
BY:
Fluxmans Inc
FOR THE
RESPONDENT:
Adv AE
Bham SC
INSTRUCTED
BY:
Lawtons Inc
[1]
Policy:
Privately-Owned Student Accommodation, approved on 29 November 2016.
[2]
Notice
897 in GG 39238 of 29 September 2015: Policy on the Minimum Norms
and Standards for student Housing at Public Universities.