Seale v Van Rooyen N.O and Others; Provincial Government, North-West Province v Van Rooyen N.O and Others (133/07) [2008] ZASCA 28; [2008] 3 All SA 245 (SCA); 2008 (4) SA 43 (SCA) (27 March 2008)

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[2008] ZASCA 28
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Seale v Van Rooyen N.O and Others; Provincial Government, North-West Province v Van Rooyen N.O and Others (133/07) [2008] ZASCA 28; [2008] 3 All SA 245 (SCA); 2008 (4) SA 43 (SCA) (27 March 2008)

Links to summary

THE
SUPREME COURT OF APPEAL
OF
SOUTH AFRICA
Case number: 133/07
Reportable
In the
matter between :
KINGSLEY
JACK WHITEAWAY SEALE ... APPELLANT
and
BERNARD
RENIER VAN ROOYEN NO ... FIRST RESPONDENT
RHEINHOLD
MATHIAS ANTWEILER NO ... SECOND RESPONDENT
PROVINCIAL
GOVERNMENT, NORTH WEST PROVINCE ... THIRD RESPONDENT
THE
REGISTRAR OF DEEDS, PRETORIA ... FOURTH RESPONDENT
And in
the matter between :
THE
PROVINCIAL GOVERNMENT, NORTH WEST PROVINCE ... APPELLANT
and
BERNARD
RENIER VAN ROOYEN NO ... FIRST RESPONDENT
RHEINHOLD
MATHIAS ANTWEILER NO ... SECOND RESPONDENT
KINGSLEY
JACK WHITEAWAY SEALE ... THIRD RESPONDENT
THE
REGISTRAR OF DEEDS, PRETORIA ... FOURTH RESPONDENT
CORAM
: HOWIE P, NAVSA, CLOETE, HEHER
et
COMBRINCK JJA
HEARD :
5 MARCH 2008
DELIVERED
: 27 MARCH 2008
Summary: Review : Administrative Actions : where an
initial act is set aside on review subsequent acts, which depend on
the initial
act for their validity, are of no force or effect. The
analysis of Forsyth as adopted in
Oudekraal
Estates (Pty) Ltd v City of Cape Town
2004
(6) SA 222
(SCA) applies to the validity of acts consequent upon the
initial act only for so long as the validity of the initial act has
not
been set aside on review; and the analysis does not deal with
whether the initial act should be set aside.
Neutral citation: This judgment may be referred to as
Seale v Van Rooyen NO
(133/07)
[2008] ZASCA 28
(27March 2008).
_________________________________________________________
JUDGMENT
CLOETE JA
/
CLOETE JA
:
INTRODUCTION
[1] In
Bullock NO v Provincial
Government, North West Province
1
this court, at the suit of the Transvaal Yacht Club
(‘TYC’), set aside on review the decision of the Premier of the
North West
Province (‘the Premier’) to register a notarial deed
of servitude in favour of Mr Seale. As the judgment records,
2
an official of the North West Province (‘the
Province’) had on 18 April 2001 executed a power of attorney for
the registration
of the servitude and a notarial deed of servitude
had been executed on 12 July 2001. Unbeknown to this court and the
TYC the servitude
had already been registered on 22 November 2002,
the day on which the TYC’s attorney of record informed the State
Attorney acting
on behalf of the Provincial Government of the
Province (‘the Provincial Government’) that the TYC intended to
appeal against
the decision of the court
a quo
in
Bullock
.
[2] The State Attorney sought cancellation of the
servitude in the Deeds Office, Pretoria, but he was advised by a
colleague that
the attitude of the Assistant Registrar was that the
order of this court in
Bullock
‘
should be regarded as null and void as it does not
grant authorisation to the Registrar of Deeds to cancel’ the
servitude. The State
Attorney approached Seale through his attorneys
but Seale refused to consent to the servitude being cancelled. He
undertook to provide
his reasons for doing so in writing but before
they were furnished, the TYC as the applicant brought motion
proceedings in the Pretoria
High Court against the Registrar of
Deeds, Pretoria, the Provincial Government and Seale as respectively
the first, second and third
respondents. The relief ultimately sought
was for an order (1) directing that the Registrar of Deeds, Pretoria,
upon presentation
to him of the order, forthwith cancel the
registration of the servitude; alternatively (2) directing the
Provincial Government and
Seale to take all steps and to sign all
documents
necessary, within five days of the order, to cancel
registration of the servitude in the office of the Registrar of
Deeds, Pretoria
and failing compliance, that the sheriff take all
steps and sign all documents necessary to cancel the servitude. Costs
were sought
against the Provincial Government and Seale jointly and
severally.
[3] Simultaneously with its answering affidavit the
Provincial Government tendered, unconditionally and at its own cost,
with the
authority of the court, to cancel the registration of the
servitude in the Pretoria Deeds Office and to pay the TYC’s costs
of
the application on an unopposed basis. The State Attorney who had
been handling the litigation explained in the answering affidavit
that he had only found out ‘afterwards’ (when precisely was not
disclosed) that the deed of servitude had been registered on
22
November 2002 and went on to say that:
‘
At all relevant times I was under
the impression that if [the TYC] would be successful with the appeal,
that such judgment would be
sufficient to cancel the registration of
the said servitude’
and
‘
I was astonished to hear that the
judgment of the Court of Appeal was not sufficient for the
cancellation of the said notarial deed
of servitude and couldn’t
understand why [Seale] won’t consent to the cancellation.’
The Provincial Government did not participate in the
proceedings in the court
a quo
after it delivered its answering affidavit and tender on
21 September 2005. Seale on the other hand put in issue the TYC’s
locus standi
to bring
the application in its own name and the authority of those who did
so, and opposed the application on the merits. The court
a
quo
(Van Rooyen AJ), in interlocutory
proceedings opposed by Seale, substituted the then trustees of the
TYC as the applicants, and ultimately
made an order directing the
Registrar of Deeds to cancel the registration of the servitude. The
learned judge further ordered the
Provincial Government to pay the
costs of the TYC and Seale. Seale has appealed against the
substantive relief obtained by the TYC
both on the merits and on the
basis that those who sought the relief on behalf of the TYC were not
authorised to do so. The Provincial
Government has appealed against
the costs orders. Both appeals are with the leave of this court.
LOCUS STANDI
AND
AUTHORITY
[4] The TYC was originally cited as the applicant. Mr
van Rooyen, a trustee of the TYC, deposed to the founding affidavit.
He said
that the application was brought ‘by the applicant as
represented by me and Brian Macdonald Scott and Anthony Money as
trustees
of the applicant by virtue of the authority vested in us by
paragraph 14 of the Constitution of the applicant’. A copy of the
TYC’s
constitution was annexed to the founding affidavit. So were a
resolution of the trustees authorising Van Rooyen to bring the
application
on behalf of the TYC and confirmatory affidavits by Scott
and Money.
[5] It is necessary to quote paragraph 14 of the TYC’s
constitution in full. It reads:
’
14 TRUSTEES
The role of Trustees shall be to hold in trust the
Club’s assets and to protect the legal and financial viability of
the Club in
pursuit of the Club’s objectives. The tenure of
trustees shall be for multiple years to enable them to provide
continuity over
the long-term affairs of the Club. The President of
TYC shall de facto be a Trustee of the Club and there shall be up to
three other
Trustees.
Trustees shall be elected at an AGM according to the
same procedures applying to the election of officers. They do not
require to
be re-elected at each AGM but shall hold their position
until either they advise the Secretary in writing that they resign
from that
position, they cease to be a member of the Club or they are
voted out of that position by a motion at an AGM or Special General
Meeting.
When Trustee positions fall vacant it shall be incumbent on
the remaining Trustees to ensure nomination and replacements by the
time
of the next AGM, or SGM if an urgent need arises.
The Trustees shall represent the Club in any legal
actions and shall involve themselves sufficiently in the Club’s
operational affairs
to forestall or mitigate any legal actions they
consider may harm the Club’s position. They shall consult the
committee of the
day on any legal matters. A Trustee shall only act
in a legal capacity for the Club if his actions have the agreement of
the other
available Trustees and such action follows the minuted
direction of the Executive Committee. Any major expenditure or
commitments
that will require the Club to borrow or pledge funds in
any form shall, unless approved at an AGM or SGM require the approval
of
the Trustees. They shall have the right to call for independent
audits of the Club’s financial affairs and to call special general
meetings of the Club in any serious matters relating to their
responsibilities.
The Trustees, for the time being shall be entitled to
seats upon the Committee, to take part in its deliberations and shall
possess
equal voting rights with other members thereof. They do not
lose their seats on the Committee through non-attendance, as do the
other
Members.
The following are provided as guidelines only regarding
Trustees.
Trustees should ideally be long-standing members of the
Club who have been flag officers and preferably past Commodores. They
should
bring legal, financial or business experience to their role
and be persons of recognised integrity and sound judgement. They
should
not hold operational responsibilities at the Club but can vote
at Committee Meetings and provide guidance from their experience.
The
Trustees should meet from time to time to consider issues of
strategic importance to the Club. They should act in consensus.’
Clause 9 of the constitution makes it clear in the
following provision that the references in paragraph 14 to ‘the
Committee’
are to the executive committee:
‘
NB: Where the word Committee is
used without qualification in these Rules, the Executive Committee is
signified.’
The function of the executive committee is set out in
clause 9 as follows:
‘
The Executive Committee shall be
appointed at the Annual General Meeting and shall manage, control and
have entire conduct of the
affairs of the Club save as shall be
prescribed by the duties of the Trustees.’
[6] The argument of Seale’s counsel was based on that
part of clause 14 of the constitution which reads:
‘
A Trustee shall only act in a
legal capacity for the Club if his actions have the agreement of the
other available Trustees and such
action follows the minuted
direction of the Executive Committee.’
It is common cause that there was no minuted direction
of the executive committee authorising the application. That,
according to
the argument advanced on behalf of Seale, is fatal.
[7] Counsel for the TYC relied on that part of clause 14
which reads:
‘
The Trustees shall represent the
Club in any legal actions . . . ‘.
The submission was that this provision authorised the
trustees to decide whether legal proceedings should be instituted.
[8] The constitution is not a model of clarity. It is my
view, however, that the argument on behalf of the TYC is correct.
Clause
9 of the constitution vests the entire conduct of the affairs
of the club in the executive committee ‘save as shall be prescribed
by the duties of the Trustees’. The duties of the trustees are, in
terms of the third paragraph of clause 14 of the constitution,
to
‘consult’ the executive committee on any legal matters. These
provisions read together are inconsistent with an interpretation
that
requires the trustees to act only on the minuted direction of the
executive committee. There is nothing startling in this.
3
The trustees are the TYC’s elder statesmen and –women
who are given particular responsibility in regard to legal matters
affecting
the Club. That responsibility appears also from provisions
of clause 14 other than those to which I have already specifically
emphasised,
namely:
‘
The role of Trustees shall be . .
. to protect the legal . . . viability of the Club . . . The Trustees
. . . shall involve themselves
sufficiently in the Club’s
operational affairs to forestall or mitigate any legal actions they
consider may harm the Club’s position
. . . They should bring
legal, financial or business experience to their role . . .’.
One of the guidelines at the end of clause 14 is that
the trustees should act in consensus. The provisions relied upon by
Seale were
inserted in my view to cater for the situation where a
single trustee is to act alone. The resort to the singular, ‘a
trustee’,
is significant. In such a case the single trustee is not
enjoined to act in consensus with the other trustees ─ those
‘available’
have to agree; and a further safeguard, inserted only
because a single trustee will be acting, is that the action taken by
that trustee
has to follow the minuted direction of the executive
committee.
[9] The argument on behalf of Seale that the trustees of
the TYC required the authority of the executive committee to bring
these
proceedings must accordingly fail. The only other preliminary
point taken in Seale’s answering affidavit was that the TYC lacked
standing to bring the application in its own name. That argument was
abandoned on appeal. Counsel representing Seale sought, however,
to
mount two further challenges: the first relating to the alleged
non-participation of the president of the TYC in the bringing
of the
application and the second, that it had not been shown that the
trustees had been properly appointed as such.
[10] It was only in argument in the court
a
quo
that the non-participation of the
president was raised. The submission, repeated on appeal, was that
the president, who is (in terms
of the first paragraph of clause 14
of the constitution quoted above) a trustee, had not joined with the
other trustees in bringing
the application. There may be a perfectly
good reason for this: the president may have died, or resigned and
the vacancy may not
yet have been filled. Or ─ for all this court
knows ─ Van Rooyen, Scott or Money, or Mr Antweiler (who was a
trustee sailing
in the Mediterranean when the application was
brought, and subsequently ratified the action of the other three
trustees) could have
been the president: such a supposition is not
far-fetched because, in terms of the first paragraph of clause 14 of
the constitution,
the number of trustees is limited to the president
and three others. But it is not necessary to speculate. The question
was not raised
in the affidavits delivered by Seale and the TYC had
no opportunity of dealing with it. The argument advanced by counsel
depends
on a fact not canvassed in the papers and it cannot be
entertained for this reason.
4
[11] Although the constitution of the TYC was annexed to
the founding affidavit, Seale did not suggest in his answering
affidavit
that the trustees who brought the application had not been
properly elected as such. The point was raised in the interlocutory
proceedings
for the substitution of the then trustees as applicants.
But Seale did not appeal against the order of the court
a
quo
granting this application; and in any
event, the position was clarified by Van Rooyen in a further
affidavit. Counsel for Seale cavilled
at the fact that resolutions of
the annual general meeting at which the trustees were elected, were
not annexed; but had Seale entertained
any doubt on this point, he
could have obtained those minutes by invoking rule 35(11) which
applies to motion proceedings (
Pieters v
Administrateur, Suidwes-Afrika
)
5
and reads (to the extent relevant):
‘
The court may, during the course
of any proceeding, order the production by any party thereto under
oath of such documents . . . in
his power or control relating to any
matter in question in such proceeding as the court may think meet,
and the court may deal with
such documents . . ., when produced, as
it thinks meet.’
MERITS
[12] It was submitted on behalf of Seale (I quote from
the heads of argument):
‘
The decision by the State
Attorney, to proceed with the registration of the Deed of Servitude,
at a time when it was authorised to
do so, should in itself have been
the subject of judicial review, before the registration could be set
aside. That never happened.’
The submission is without substance. There was no
‘decision’ by the State Attorney. The execution of the power of
attorney by
the official of the Province to enable the notarial deed
of servitude to be registered, the conclusion of the notarial deed of
servitude
itself and the lodging of the documents with the Registrar
of Deeds by the State Attorney were not ‘decisions’ but acts
performed
to give effect to the decision of the Premier to register a
notarial deed of servitude in favour of Seale. This court held in
Bullock
that that
decision amounted to administrative action based upon incorrect
advice fundamental to its proper exercise and it was accordingly
set
aside.
[13] Counsel for both Seale and the TYC sought to rely
in argument on passages in the decision of this court in
Oudekraal
Estates (Pty) Ltd v City of Cape Town
6
which adopted
7
the analysis by Christopher Forsyth
8
of why an act which is invalid may nevertheless have
valid consequences and concluded:
9
‘
Thus the proper enquiry in each
case ─ at least at first ─ is not whether the initial act was
valid but rather whether its substantive
validity was a necessary
precondition for the validity of consequent acts. If the validity of
consequent acts is dependent on no
more than the factual existence of
the initial act then the consequent act will have legal effect
for
so long as the initial act is not set aside by a competent court
.’
Applying that analysis to the present facts, the
substantive validity of the decision of the Premier (the initial act
by the first
actor) was not a necessary precondition for the validity
of the consequent act (the registration of the servitude by the
Registrar
of Deeds, the second actor); as long as the decision stood
the validity of the registration was dependent on no more than the
factual
existence of the Premier’s decision.
10
But all of this is irrelevant and the reliance by
counsel on the decision in
Oudekraal
,
misplaced. As appears from the italicised part of the judgment just
quoted, the analysis was accepted by this court as being limited
to a
consideration of the validity of a second act performed consequent
upon a first invalid act, pending a decision whether the
first act is
to be set aside or permitted to stand. This court did not in
Oudekraal
suggest that
the analysis was relevant to that latter decision. The judgment
emphasised
11
that:
‘
[A] court that is asked to set
aside an invalid administrative act in proceedings for judicial
review has a discretion whether to
grant or to withhold the remedy.
It is that discretion that accords to judicial review its essential
and pivotal role in administrative
law, for it constitutes the
indispensable moderating tool for avoiding or minimising injustice
when legality and certainty collide.’
I think it is clear from
Oudekraal
,
and it must in my view follow, that if the first act is set aside, a
second act that depends for its validity on the first act must
be
invalid as the legal foundation for its performance was non-existent.
It is precisely because of this consequence that a court
asked to
review the first act and set it aside has, and must have, a
discretion whether or not to do so.
12
Some of the factors relevant to the exercise of that
discretion were discussed in
Oudekraal
;
13
they include the lapse of time, the need for finality,
the consequences for the public at large and the extent to which
persons may
have acted in reliance on the decision which it is sought
to set aside. But the question whether or not the decision by the
Premier
in this matter should be set aside, has already been answered
by this court in
Bullock
.
The result is that all acts done consequent upon that decision
(including the registration of the servitude), and all acts to give
effect to it (including those to which I have referred in the
previous paragraph of this judgment), are of no force or effect.
[14] It was submitted on behalf of the TYC, following
upon views expressed from the bench during the hearing of the appeal,
that the
decision of this court in
Bullock
was retrospective in that it must be substituted for the
order of the court of first instance in
Bullock
,
and it accordingly operated from the date upon which the latter court
gave its order; and that because that date preceded the date
of
registration of the servitude, the registration of the servitude was
invalid for that reason. That is so (although an order to
this effect
would have been required before the Registrar could cancel the
registration of the servitude) but the result would have
been the
same even if the registration of the servitude had preceded the date
on which the court of first instance gave its order
in
Bullock
.
The reason is that acts performed subsequent to a decision which is
set aside and which can no longer depend upon the mere existence
of
that decision for their own validity, are invalid once the decision
is set aside, irrespective of whether those acts were performed
before or after the court order invalidating the decision.
COSTS
[15] As I have already said, the court
a
quo
ordered the Province to pay the costs of
both Seale and the TYC. Seale abandoned the order in his favour. But
he only did so in the
heads of argument for this court delivered on
17 September 2007. It was pointed out by his counsel that he did not
oppose the Province’s
applications for leave to the appeal made to
the court
a quo
and to
this court; but the fact remains that until he abandoned the order,
the Province was obliged to bring those proceedings and
to proceed to
appeal. The Province is accordingly entitled to its costs up until 17
September 2007 and its counsel sought nothing
more.
[16] Counsel for the TYC submitted that the order of the
court
a quo
was
justifiable on the basis that had the State Attorney informed this
court of the registration of the servitude timeously, the point
would
have been argued and decided in its favour in
Bullock
and these proceedings would then have been unnecessary.
With hindsight, that is so (provided the Registrar of Deeds had been
joined
as a party to the previous appeal). But the difficulty with
the submission is that the State Attorney dealing with this appeal
was
entitled to assume that the decision in
Bullock
would invalidate also the registration of the servitude
(as this court has now held) or, at worst, would require an order to
enable
the Registrar to cancel it; and in view of that decision, the
State Attorney would reasonably have been entitled to assume that
such
an application would be unopposed. It is Seale who should have
been ordered to pay the costs of the proceedings in the court
a
quo
─
but there is no cross-appeal by the
TYC for such an order. This, however, cannot redound to the
disadvantage of the Province.
[17] Counsel for the TYC further submitted that the
costs order of the court
a quo
could be justified on the basis that the Province failed
to bring an application to compel Seale to co-operate in the
cancellation
of the servitude. But even assuming any such obligation,
the Province was in the process of ascertaining the reasons for
Seale’s
refusal to consent to the cancellation of the servitude
when the application was brought by the TYC against
inter
alios
it and Seale; and once that happened,
the Province could not have been expected to do anything more than
tender the relief which it
did. The costs occasioned by Seale’s
opposition were not of its making and I fail to see any basis upon
which it should be ordered
to pay such costs.
[18] Finally, counsel on behalf of the TYC attempted a
damage control exercise by arguing that the Province had
unnecessarily embarked
on a costly appeal when a relatively cheaper
application in terms of rule 42(1)(a) was available to it. The rule
reads:
‘
(1) The court may, in addition to
any other powers it may have,
mero
motu
or
upon the application of any party affected, rescind or vary:
(a) an order or judgment erroneously sought or
erroneously granted in the absence of any party affected thereby.’
Proceedings against Seale under the rule were competent
in as much as he had not asked for a costs order against the Province
and
that order was therefore erroneously granted within the meaning
of the rule. But such proceedings would not have been competent
against
the TYC, because the TYC did ask for the costs order made by
the court
a quo
in its
favour. The granting of this latter order amounted to a mis-exercise
of the court
a quo
’
s
discretion because it unjustifiably disregarded the tender made by
the Province,
14
but that renders the order appealable; the order was not
‘erroneously sought’ or ‘erroneously granted’ within the
meaning
of the rule. The
submission by counsel representing the TYC
that
the rule should be interpreted, ‘because of its plain and
grammatical meaning’, as covering orders wrongly granted, is
inconsistent
with the interpretation given to the rule in numerous
cases,
15
has not a shred of authority to support it and requires
no further consideration. Equally without merit is the submission
that the
court
a quo
could
in terms of the rule have varied the order in favour of the TYC in
proceedings brought by the Provincial Government against
Seale, to
provide that the Provincial Government and Seale would be jointly and
severally liable for the TYC’s costs. The basis
for this latter
submission was that only one costs order was made by the court
a
quo
. In fact two costs orders were made ─
one in favour of Seale and one in favour of the TYC; and neither had
anything to do with
the other.
[19] The Province asked for the costs of two counsel.
The questions raised by the Province’s appeal were anything but
complex and
there is in my view no basis for such an order. On the
other hand, it was in my judgement a wise and reasonable precaution
for the
TYC to have briefed two counsel to oppose the appeal brought
by Seale, in view of the history of this matter, what was at stake in
these proceedings and (I would say without wishing to fan the flames
of litigation further) what may occur in the future.
[20] The following order is made:
(1) The appeal by Seale is dismissed with costs. Seale
is ordered to pay the costs of appeal of the TYC, including the costs
of two
counsel.
(2) Seale is ordered to pay the costs of the appeal by
the Province against the costs order in his favour up to 17 September
2007.
(3) (a) The appeal by the Province against the costs
order in
favour of the TYC succeeds, with costs.
The order of the court
a quo
awarding costs to the TYC is set aside
and the following order substituted:
‘
The Province is ordered to pay the
TYC’s costs of the application up to and including 21 September
2005, being the date on which
the answering affidavit and tender by
the Province was served upon it. Such costs shall include the costs
attendant upon that affidavit
and the tender, shall exclude the costs
occasioned by Seale’s opposition to the application and all
interlocutory applications,
and shall be taxed on an unopposed
basis.’
______________
T D CLOETE
JUDGE OF APPEAL
Concur: Howie P
Navsa JA
Heher JA
Combrinck JA
1
2004
(5) SA 262
(SCA). The reference to a 'lease' in para 24 at p 273A,
and in the headnote at p 264B-C, should be a reference to a
'servitude'.
2
Ibid
para 5.
3
Contrast
Kempff v Visse
1958
(1) SA 379
(T) at 380B-C and
Nampak
Products Ltd t/a Nampak Flexible Packaging v Sweetcor (Pty) Ltd
1981 (4) SA 919
(T) at 921D-H which deal with the
institution of an action by a company.
4
Minister
of Land Affairs and Agriculture v D & F Wevell Trust
2008 (2) SA 184
(SCA) para 43.
5
1972
(2) SA 220
(SWA) at 228B-D.
6
2004
(6) SA 222
(SCA).
7
In
para 29.
8
‘
"The
Metaphysic of Nullity": Invalidity, Conceptual Reasoning and
the Rule of Law’ in
Essays on Public
Law in Honour of Sir William Wade QC
(Christopher Forsyth and Ivan Hare (eds),
Clarendon Press) at 141; see also the subsequent article by the same
learned author ‘
The Theory of the
Second Actor Revisited
’
2006
AJ 209.
9
In
para 31; emphasis supplied.
10
cf
Oudekraal
paras
39 and 40.
11
Para
36 at p 246C-D.
12
cf
Oudekraal
para
38.
13
Para
46.
14
Naylor
v Jansen
2007 (1) SA 16
(SCA) para 14
at 23E-F.
15
See
eg
Topol v L S Group Management
Services (Pty) Ltd
1988 (1) SA 639
(W)
at 648D-650A,
Nyingwa v Moolman NO
1993 (2) SA 508
(Tk) at 510D-511A and cases
referred to in both decisions.