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[2019] ZAECMHC 34
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South African National Parks v Biggs and Others (3161/2011) [2019] ZAECMHC 34; [2019] 3 All SA 987 (ECM) (20 June 2019)
IN
THE HIGH COURT OF SOUTH AFRICA
(EASTERN
CAPE LOCAL DIVISION, MTHATHA)
CASE
NO. : 3161/2011
Date
reserved : 7 March 2019
Date
delivered : 20 June 2019
In
the matter between:
SOUTH
AFRICAN NATIONAL PARKS
Applicant
And
ANTHONY
LAURISTON BIGGS
First Respondent
GYBERT
JACOBUS VAN DEVENTER
Second Respondent
THE
MINISTER OF LAND AFFAIRS
Third
Respondent
ADDO
AFRIQUE ESTATE (PTY) LTD
Fourth Respondent
ADDO
AFRIQUE SAFARI LODGE CC
Fifth Respondent
ADDO
AFRIQUE ESTATE PORTION 21
(PTY)
LTD
Sixth
Respondent
RIDGE
FARM CC
Seventh
Respondent
MARK
ANTHONY BIGGS
Eighth Respondent
LARA
JEAN BIGGS
Ninth
Respondent
GARY
JOHAN LOGANLESLIE DAWN LOGAN
Tenth
Respondent
ROBERT
JOHN TAPSON N.O.
Eleventh
Respondent
BELINDA
TAPSON N.O.
Twelfth Respondent
(TRUSTEES
OF THE MARIZE TRUST,
IT
496/20090
Thirteenth
Responden
JEROF
NGQUSE
Fourteenth
Respondent
NOTHINI
NGQUSE
Fifteenth Respondent
JOEY
PIETERSE
Sixteenth Respondent
FLORENCE
PIETERSE
Seventeenth
Respondent
SUNDAYS
RIVER VALLEY MUNICIPALITY
Eighteenth Respondent
REGISTRAR
OF DEEDS, CAPE TOWN
Nineteenth
Respondent
FIRST
NATIONAL BANK
Twentieth
Respondent
ABSA
BANK LIMITED
Twenty
First Respondent
STAND
A
RD
BANK OF SOUTH AFRICA
LIMITED
Twenty
Second Respondent
MINISTER
OF AGRICULTURE
Twenty
Third Respondent
THE
MEC FOR ECONOMIC AFFAIRS,
ENVIRONMENT
AND TOURISM, EASTERN
CAP
E
Twenty
Fourth Respondents
THE
SURVEYOR GENERAL
Twenty
Fifth Respondent
JUDGMENT
MAJIKI
J:
[1]
The applicant in this application in the main, seeks review, on
various grounds, of the third and eighteenth
respondents’
decisions to approve the subdivision and rezoning of the land known
as remainder of farm Vista No. 367 in Sundays
River Valley
Municipality, division of Alexandria, Eastern Cape, measuring 282,
9482 hectares, held under title deed no. T37591/1986
(the farm)
respectively. Further, that the subsequent sales and
registrations of portions of the farm be set aside,
except for
portions 58 and 59. During 2001, the first respondent as
the owner of the farm, sold 780 hectares of the
farm, being portion
10 thereof, to the applicant for R1 005.136.00. The deed of sale
entered thereto between the first respondent
and the applicant
provided for a right of pre-emption by the applicant on the remainder
of the farm. The applicant was already
the owner of Addo
Elephant National Park which neighbours the portion of the farm he
purchased. Without the applicant being afforded
the opportunity to
exercise his right of pre-emption, the first respondent through the
fourth respondent was granted approval of
subdivision of the
remainder of the farm by the third respondent. The eighteenth
respondent also approved subdivision and
rezoning of the farm.
The said remainder was later sold or transferred to various
respondents (including second, fourth,
fifth, seventh, fourteenth to
seventeenth respondents).
[2]
The application is opposed by the first, second, fourth, fifth,
sixth, seventh, eighth,
ninth, tenth, eleventh, twelfth, thirteenth,
fourteenth, fifteenth, sixteenth, seventeenth, and eighteenth who
filed notices indicating
their intention to oppose the
matter. The twenty third respondent filed notice to
abide. During the hearing,
the argument was heard on behalf of
second, fourth, fifth, sixth, tenth, eleventh, twelfth and eighteenth
respondents only.
The first respondent’s representative
arrived in court during the course of argument and wanted to serve
papers on the other
parties and also file the heads of argument. This
was despite the fact that on the last occasion in August 2018 he was
given indulgence
to have the matter postponed, and put on terms to
file the answering affidavit within 15 days of the order, which terms
he failed
to meet. The attempt to be involved at that stage in
that manner was opposed on behalf of applicant and other opposing
respondents
for various reasons. These included the inconvenience and
prejudice that would result from such an action by the first
respondent.
Eventually, no submissions were allowed
to be made on behalf of the first respondent.
[3]
The practice notice filed on behalf of the second, fourth, fifth,
sixth and seventh
respondents in terms of
r
ule
15 of Eastern Cape Joint Rules of Practice had stated the issues to
be determined, which included an application to strike out
certain
portions of the applicant’s replying affidavit. However,
during the hearing, everyone agreed that this application
as at that
stage, turns on legal argument relating to the condonation of the
applicant’s delay in bringing up the review
application and
exhaustion of internal remedies. Further, whether the personal
right of pre-emption against the first respondent
can be preferred
against the real rights of the rest of the respondents who had the
portions of the farm transferred into their
names and whether those
respondents were aware of the existence of such personal rights and
the implications of having or did having
such knowledge.
BACKGROUND:
COMMON CAUSE FACTS
[4]
In around 2001 the first respondent became the owner of the farm.
The first
respondent entered into an agreement of sale with the
applicant for the sale of portion 10 of the farm.
Clause 14.1 of the said agreement
reads:
“
The seller undertakes to first
offer the remainder of the farm Vista No. 367 (after subdivision as
described in 13) to the purchaser
for sale at the same terms and
conditions he can sell it to a third party, should the seller at any
time decide to sell it.
The purchaser has the right to accept
the offer to purchase that land within 30 days of being notified of
the offer.”
[5]
The applicant owns Addo Elephant Park, a part of the national park
which neighbours
the portion he purchased. The remainder of the
farm Vista (to which the applicant’s right of pre-emption
refers) also
neighbours Addo Elephant Park. The two properties are
separated by R342 provincial road (R342).
[6]
In 2005, after being introduced to the first respondent, the second
respondent expressed
his interests to purchase a portion of 45
hectares of the remainder of farm. Instead his
negotiations with the first
respondent led to them agreeing to enter
into a joint venture which was concluded orally in May 2007.
The 237 hectares in
the South of R342 were subdivided to establish
eco-estate therein, consisting of 47 subdivided portions of 4-5
hectares each.
The 282 hectares, of which 45 hectares are
located north of R342, were to be transferred into the name of Addo
Afrique Estate (Pty)
Ltd, the fourth respondent, whose directors
became the first and second respondents.
[7]
On 23 October 2006, before the transfer of the property to the fourth
respondent,
the first and second respondents applied to the third
respondent for exemption from the statutory provisions prohibiting
subdivision
and rezoning of the property for the purposes of a
development. In their application they did disclose to the
third respondent
the agreement of sale between the applicant and the
first respondent. They, as shareholders of the fourth
respondent, concluded
an agreement recording that there would be
subdivided portions which would ultimately be transferred to the
fourth, fifth, seventh,
eighth, ninth, tenth and eleventh
respondents. The approval of a subdivision plan was eventually
granted being general plan
2641/2007.
[8]
The now amended Provision of Land and Assistance Act 126 of 1993
(PLAA) in sections
2 to 10 provided for provision of land for settlement and financial
assistance for the acquisition, development and improvement
of land
or to secure tenure rights. A sum of R10 000.00 was
approved to be released from government funds in order to
pay the
surveyor general to subdivide the property. Its application was
motivated by two officials of the third respondent.
On 13
November 2006 other three officials of the third respondent motivated
the approval of the subdivision referring to donation
of portions 58
and 59 of the property to fourteenth to seventeenth respondents.
On 8 October 2007 the deputy director of
the third respondent
approved the first and second respondents’ development of the
property also granting exemption from
provisions prohibiting
subdivision of agricultural land in terms of section 10(3) of PLAA.
[9]
On 9 October 2007 the municipal manager of the eighteenth respondent
provided exemption
by approving the subdivision of the property in
terms of section 23 of Land Use Planning Ordinance Act 15 of
1985 (LUPO).
This occurred long before the rezoning of
the property. The rezoning only took place in June 2008.
It was
only on 18 June 2008 that the eighteenth respondent’s
council actually resolved that all the subdivisions be registered as
fractional ownership and be rezoned as resort zone 2. During
the period between 23 June 2008 and 2 December 2008 the
eighteenth
respondent had approved various applications and issued zoning
certificates in respect of all the portions of land.
On
12 February 2008 the following transfers from the first respondent
had already occurred. Portions 11 to 18,
20, 22, 27, 31, 32, 40
to 43, 49 to 55 and 60 were transferred to the fourth respondent
(Addo Afrique Estate (Pty) Ltd; portion
21 to the sixth respondent
whose directors are first and second respondent appointed in 13 April
2007;
Portions
28, 36 to 37, 44 to 48 to the seventh respondent Ridge Farm CC (whose
members were Anthony Biggs Family Trust, first, eighth
and ninth
respondents but later liquidated on 9 June 2015);
Portion 29 to the eighth respondent
(Marck Anthony Biggs);
Portion 30 to the ninth respondent
(Lara Jean Biggs);
Portion 33 to the tenth respondent
(Gary Johan Logan);
Portion 34 to the eleventh respondent
(Leslie Dawn Logan
)
;
Portion 19 to the eleventh and twelfth
respondent (Marize Trust);
Portion 58 to the fourteenth and
fifteenth respondents (Jerof and Nothini Ngquse);
Portion 59 to the sixteenth and
seventeenth respondents (Joey and Florence Pieterse);
Portion 35 to the fifth responden
t
(Addo Afrique Safari lodge CC).
ISSUES
FOR THE APPLICATION
[10]
There are a number of procedural aspects which the applicant has
raised on the merits of the
application as either constituting
irregularities, flaws, or noncompliance with requirements in the
process leading to the decisions
sought to be reviewed. Before
venturing into those, I propose to deal with preliminary legal points
raised by the respondents
herein.
CONDONATION
OF FAILURE TO COMPLY WITH 180 DAY PERIOD PRESCRIBED IN THE
ADMINISTRATIVE JUSTICE ACT (PAJA)
[11]
The applicant concedes delay in the bringing up of the proceedings
beyond or outside the period
prescribed in section 7(1) of PAJA.
It avers that the circumstances of this case and or the interests of
justice warrant
the exercise of the court’s discretion to
favour the granting of the extension. The respondents, on the
other hand
approach the issue by giving a summary of what they refer
to as material timeline of events leading to the present
application.
The second, fourth, fifth and sixth respondents,
in particular, aver that in the light of a delay of about one year,
five months
from the date of application for interim relief and three
years, seven months of the meeting of the officials of the applicant
and the second respondent, which is when the applicant was fully
aware of the development of Addo Afrique Estate, there is no
explanation
for the delay to the time the application was launched in
September 2011. The delay may be prejudicial to the respondents
and trump the public interest element of finality of administrative
decisions. Finally, regard cannot be had to the merits
of the
application when considering whether to condone delay.
LEGAL
PRINCIPLES APPLICABLE TO CONDONATION
[12]
The factors to be considered when determining a condonation
application, include:
12.1 Nature of the
relief sought;
12.2 The extent and
cause of delay;
12.3 The effect of
the delay in the administration of justice and other litigants;
12.4 The explanation
for the delay;
12.5 The importance
of issues to be raised in the intended review; and
12.6 The merits of
the review and the prospects of success.
[13]
With regard PAJA review applications, where they are brought outside
the statutory prescribed
period
the Constitutional Court in
Buffalo City
Metropolitan
Municipality v Asla Construction (Pty) Ltd
2019 (6)BCLR 661(CC), confirmed the principle it enunciated in
Department of Transport v Tasima
(Pty) Ltd
2017 (2) SA 622
(
Tasima1
).
In Tasima the same court found that the decision was not challenged
timeously, the good faith may be a reason to overlook
the delay.
The department’s behaviour was muddled but not malicious.
[14]
Further, in
Asla
(
supra)
,
the court overruled some conclusions held by the Supreme Court
of Appeal. Firstly, that in considering undue delay, albeit
within the context of PAJA, full and proper determination of merits
of the review application depended upon a finding that the
respondent’s failure had to be condoned. Further that,
therefore, merits cannot be considered before deciding whether
to
condone an undue delay in bringing a review application and finally,
that condonation must be dealt with first before examining
the merits
of the review application. The Supreme Court of Appeal said the
basis
for
this was that in the absence
of an extension, the court had no authority to entertain the review
application. The Constitutional
Court affirmed that its
jurisprudence, even in the context of PAJA did not support the
approach taken by the SCA (see paragraphs
56 to 57). The
Constitutional Court made reference to a number of cases from that
court where it repeatedly stated that the
nature and extent of
deviation from constitutional prescripts directly impacts upon an
application for condonation.
[15]
At paragraph 62 the Constitutional Court also held that
“even
where the functionary has not acted as a model litigant or
“
constitutional citizen
”,
there may be
a basis to overlook the
delay if the functionary acted in good faith or with the intent to
ensure clean governance”(
Buffalo City
,
supra
).
This re-affirmed what that court had stated in
Tasima
,
supra
at paragraph 159. Finally, the court articulated a principle
that stems from
State Information Technology Agency SOC Limited v
Gijima Holdings (Pty) Limited
2018 (2) SA 23
(CC),
decided after the SCA judgment in
Asla
. In
Gijima
the court stated that even where there is no basis for a court to
overlook an unreasonable delay, the court may nevertheless be
constitutionally compelled to declare the state’s conduct
unlawful. Finally, the court confirmed that courts should
always balance the objectives of the rules on delay with those
objectives of declaring unlawful conduct as such. At paragraph
70 the court reaffirmed the principle it had already repeated before,
that a court should be slow to allow procedural obstacles
to prevent
scrutiny of a challenge to the exercise of a power, but the court
emphasized, that it is a feature of the rule of law
that undue delay
should not be tolerated. The court quoted what it had stated in
Tasima
at paragraph 160 as follows:
“
Delay can prejudice the
respondent, weaken the ability of a court to consider the merits of a
review, undermine the public interest
in bringing certainty and
finality to administrative action. A court should therefore
exhibit vigilance, consideration and
propriety before overlooking a
late review, reactive or otherwise.”
The
court stated that the
Gijima
principle should thus be
interpreted narrowly and restrictively so that the valuable rationale
behind the rules on delay is not
undermined. The court in
Asla
concluded that the municipality failed to provide a
satisfactory explanation for the delay and therefore it could not
overlook the
delay. However, the underlying contract was
clearly unlawful. On undisputed facts, it must declare it
invalid in terms
of section 172 (1) (
a
) and set it aside.
Its unlawfulness could not be ignored.
APPLICATION
OF THESE PRINCIPLES IN THE APPLICATION FOR EXTENSION IN TERMS OF
SECTION 9(1) (
b
)
[16]
According to the applicant prior to 2008, the applicant became aware
of the construction of buildings,
appearing to be two luxurious
homesteads on the property on the southern side of R342. However,
the applicant says
it did not know whether other tracts of the land
had been purchased and consolidated with the property as there are
numerous farms
in the province which were being converted into game
farms. It appeared normal to have few buildings erected on a
single
agriculturally zoned property. It was only when the
development was at an advanced stage and unbeknown to the applicant,
it was already being marketed, that the applicant became aware of the
development.
[17]
In February 2008 the second respondent approached two officials of
the applicant with an application
to the third respondent stating
that he had obtained approval of the development of the property
without disclosing more.
According to the second respondent, he
earlier withheld information at the advice of his attorney. He
suggested that a portion
of the property be exchanged for a portion
of the Addo Elephant National Park and that a watering hole be
constructed on the property
and the animals that would be in the game
farm and lodge be allowed to drink thereon. The applicant’s
officials were
not interested in making animals to be subjected to
degradation.
[18]
In June 2008, unbeknown to the applicant, the eighteenth respondent’s
council irregularly
provided exemption from compliance with the
provisions of LUPO. It approved rezoning and building plans for
the development
of the farm. In July 2008 the applicant through
its attorneys started with investigations, informed by internal
discussions
and following the receipt of information about exemption
from compliance with LUPO. By then there was a huge entrance on
the southern side of the national road indicating that the property
belonged to the fourth respondent. The applicant started
gathering information about development which proved to be difficult
to obtain from the eighteenth respondent due to the absence
of
municipal manager and its council being almost lifeless. The
eighteenth respondent only furnished information and documentation
on
17 October 2008. At the end of January 2009 the applicant’s
attorney addressed a letter in terms of Promotion of
Access to
Information Act (PAIA) requesting specified information, to no
avail. The applicant continued with requests for
additional
documentation.
[19]
On 10 February 2009 the third respondent confirmed that the property
was not designated as contemplated
in the Act. No gazette
notice had been issued and no publication in the newspaper had been
done. The departments
of agriculture and environmental affairs
also revealed that no subdivision application was made to them.
There was no advertisement
of the proposed development anywhere.
No notices were given to adjoining landowners, including the
applicant. The applicant
then sought a legal opinion; after it
came to hand it was placed before the legal department of the
applicant and then its board.
The board meets in Pretoria
periodically. In May 2009, a demand was addressed to the fourth
respondent to cease further building
works and sales of subdivided
portions of the farm. None of the undertakings to that effect
could be received from the fourth
respondent. Letters were also
addressed to the third and eighteenth respondents advising of
intended applications to set
aside the approvals of the subdivisions
and the rezoning of the property. This engagement is a
statutory requirement.
No response was received.
[20]
The applicant could not establish the whereabouts of the individual
owners of the subdivided
portions of the farm. The deeds office
records confirmed the identity of owners only, as for trust owners,
(the twelfth and
thirteenth respondents) it took extensive enquiries
to obtain details of the trustees. The tenth and eleventh
respondents
were eventually traced to be residing in Scotland.
The first and second respondents were uncooperative. A
conveyancer
had to be appointed to do a research for the applicant.
Information was being obtained in piecemeal and an opinion had to
be
sought on the interpretation of the Act. During August to
December 2009 all the information had to be considered by the
applicant, weighing its options in consideration of the complexity of
the issues. The draft founding affidavit was completed
in
January 2010 and circulated to officials for comments. A
meeting with the acting deputy director of the third respondent
was
only secured in February 2010, with a view to seek amicable solution
of the matter than having to litigate against a government
department. An application for interim relief was launched on
20 April 2010. The service and opposition notices took
time,
the various opposition notices indicate dates of 4 June, 1 July and
19 October 2010. Further undisclosed information
was gleaned
upon filing of the opposing affidavit of the third respondent.
The true reasons for the development are set out
in the letter by the
land surveyor to the eighteenth respondent. There was still no
copy of the resolution by the eighteenth
respondent. Prolonged
settlement negotiations ensued and failed. The interim
interdict application was argued finally
in August 2011.
[21]
The surreptitious manner in which the first and second respondents
conducted the entire matter
and refusal to furnish necessary
information made it impossible to bring the review application
timeously. The applicant
did not delay unreasonably in the
bringing up of the application brought in September 2011.
[22]
The period provided for in section 7(1) of PAJA commences to run from
the date on which reasons
for the administrative action became known
to the applicant. In considering the time period for the bringing of
this application
in terms of section 7(1) of PAJA, it ought to
commence from the date on which the reasons for the administrative
action were furnished
or they ought to have reasonably become known
to the party seeking review.
[23]
In the applicant’s view, the issue of determining whether the
delay ought to be condoned,
is inextricably linked to the nature and
consequences of the decision as well as with the degree, if any, of
non-compliance with
statutory prescript.
[24]
According to the second, fourth, fifth and sixth respondents the
applicant was aware of development
of Addo Afrique since February
2008. Further, in June 2008 an auction was conducted under
auspices of the applicant, during
the Kirkwood game festival.
Pamphlets for potential bidders were placed on all their chairs and
officials of the third respondent
directed that they be removed.
[25]
The applicant did nothing to compel the third and eighteenth
respondents to file their records
of the proceedings of when the
impugned decisions were taken. Their action in that regard only
ended with the prayer seeking
same in its notice of motion.
[26]
These respondents have approached the issue of delay by providing a
timeline of events that are
relevant in this matter. Following
the registrations of transfer of land on 12 February 2008, there were
other processes.
On 7 May 2008 the eighteenth respondent
approved building plans in respect of the residence erected on
portion 28 of the said farm.
After the meeting between the
second respondent and two officials of the applicant in February
2008, according to the averments
made in the affidavit deposed to by
one Toto Van der Merwe herein, the applicant was fully aware of
the development of the
fourth respondent. The said respondents
state that, by July 2008 the gate house indicating that the property
belonged to
the fourth respondent had already been erected. In
July 2008 the applicant’s officials established that the
remainder
of the farm had been transferred and subdivided. In
May 2009 the applicant addressed a letter of demand to the fourth
respondent
to cease further building works and sale of subdivisions.
In August 2011 the interim interdict was argued having been launched
on 20 April 2010. The present application was issued on 30
September 2011.
[27]
Consequently, from the meeting between the second respondent and two
officials the applicant
in February 2008, three years and seven
months had elapsed up to the time this application was issued;
From
July 2008, when the fourth respondent’s gate was erected and
when the officials of the applicant discovered the subdivisions
and
transfers, up to when the review application was issued three years,
two months had elapsed;
From
20 April 2010, when the applicant launched the application for the
interim relief, up to the time when the application for
review was
issued, one year, five moths had elapsed.
[28]
On 12 February 2008, the registration of transfers took place.
Before June and July 2008
the applicant was aware of the
development. The demand was issued in May 2009.
Thereafter, investigations followed,
leading to application for
interim interdict.
[29]
With reference to the issue of reasons for the impugned decisions,
the said respondents refer
to
Mostert v Registrar of Pension Funds
2018 (2) SA 53
(SCA),
paragraph 41. It
was stated:
“
It follows that reasons for an
administrative action will not always be furnished. There is no
obligation to furnish reasons
where they have not been requested,
save in those cases specified in a list published by the Minister in
terms of section 5(6)(
a
), in respect of
which the administrator concerned must automatically furnish reasons
without a request therefor.”
The
argument by the said respondents seems to suggest that the applicant
cannot rely in the absence of record under the circumstances
where it
did nothing to ensure that it was furnished.
[30]
The 180 day period commenced to run, when taking a broad view that
the public at large might
reasonably be expected to have knowledge,
upon registration of the transfers. Registration of ownership
at the deeds office
is for the public to be notified of ownership.
The applicant has not proffered an explanation why the review
application
was launched three years, seven months from date of
registration of transfers to the date of issue of the present
application.
Similarly, it has not done so in respect of the
period from 20 April 2010, after issuing the application for interim
relief and
after 9 May 2009 after issue of letter of demand.
According to the said respondents, the applicant was
fully aware
of the facts by then. During the hearing it was
submitted on behalf of the tenth to thirteenth respondents that those
respondents
align themselves with these submission regarding the
application for condonation.
[31]
Section 9(1)(
b
) of PAJA provides:
“
The period of-
90 days or 180 days referred
to in sections 5 and 7 may be extended for a fixed period
,
by agreement between the
parties, or failing such agreement, by a court or tribunal on
application by the person or administrator
concerned.”
[32]
According to the applicant, the 180 days has to be calculated from
the time the reasons for the
impugned decisions became known to the
applicant or ought to have been known by it. Throughout in its
papers the applicant
refers to request for information, which it says
the eighteenth respondent furnished on 10 February 2009. No
request for
reasons for the decisions was made until the time of the
launch of the present application. In my view, the applicant
ought
to have asked for the reasons or record of the proceedings
after 10 February 2009, if it considered same to be required.
It therefore cannot be that, the applicant can now seek to rely on
the failure of the third and eighteenth respondents to furnish
the
reasons. Such reasons were furnished way after the launch of
these proceedings.
[33]
Indeed during the auction in 2008 and in July 2008, when the gate was
erected
indicating the fourth respondent to be the owner of the property and
the knowledge that the subdivisions had taken place,
the applicant
had substantial information to act thereon. This is even more
so if one takes into account what Van der Merwe
stated in his
affidavit. Despite the fact that Toto Van der Merwe has no
direct information of what the officials of the
applicant were told
by the second respondent, however, he states that he had frequent
contact with the official representatives
of the applicant. He
is a formal concession holder owning Nguni lodge close to the
applicant’s park. He was advised
of the eco-development.
He and the applicant’s officials were furnished with the plans
before February 2008.
It is difficult to imagine that Van der
Merwe would be advised of eco-development but not the officials of
the applicant.
The applicant itself confirms that its officials
saw the proposal of the project, which refers, among others, to
phase1 that will
be a 4 or 5 star lodge for upper-end tourist lodge.
However,
I am not persuaded that the information I referred to was sufficient
for the applicant to act. This is glaringly
so considering the
tabulated efforts the applicant made to obtain more information,
thereafter.
[34]
It is the applicant’s case that, early in 2009 it became aware
of the fourth respondent’s
ownership. However, the
applicant does not state how long it took for it to obtain the legal
opinion and place the
matter before the next periodical meeting of
the board. Furthermore, after the issue of the letter of demand
in May 2009,
the applicant does not explain as to what timelines it
had set for itself to act, in the event that the undertakings were
not forthcoming
from the fourth respondent. Also, it does not
state how much time it set to allow for the engagements with third
and eighteenth
respondents before it commenced with the intended
litigation. It also does not state how long it took to engage a
conveyancer
to undertake the research about the ownership of the
subdivided properties and how long it took the
conveyancer
to do so. Finally, how long it took to seek a legal
opinion on the interpretation of the Act.
[35]
Even from the time the interim interdict was served in April 2010,
the applicant failed to explain
why it considered it necessary to
halt the review proceedings until the hearing of argument or judgment
in the interim proceedings.
It also failed to furnish
information about how long the settlement negotiations took. In
truth, the applicant did not act with
the required expediency in the
handling of the issues in this matter. In the circumstances, I
am not persuaded that the applicant
satisfactorily gave the
explanation and cause for the delay.
[36]
With that finding made, however, in the light of the authorities by
the Constitutional Court
referred to above, I have to establish
whether there is any other reason to entertain the review
application. The respondent
conceded most of the
irregularities and noncompliance with statutory requirements in the
process of establishing the eco-estate,
zoning and subdivision of the
concerned land. I am therefore of the view that there is
reason to allow ventilation
of issues raised in the review.
EXHAUTION
OF INTERNAL REMEDIES
[37]
The applicant concedes that in terms of LUPO there is a room for an
internal appeal for rezoning
granted in terms of LUPO. None of
the litigants expanded on the remedies, that is, what LUPO provides
in that regard.
Sections 16, 17, and 18 of LUPO deal with
rezoning granted by the administrator or council, which in this
matter would relate to
those granted
by
the eighteenth respondent. Section 44(1) (
c
)
and (
d
) provide
s:
“
A
person aggrieved by a decision of a council in the application of
section 18 may similarly appeal to the Administrator against
such
decision.
For the
purposes of sections 15 (3), 17 (3) and 24 (3) provision may be made
by regulation therein referred to for a right of appeal
to the
Administrator in the manner prescribed by such regulation.”
According
to the previous subsections referred to above, the aggrieved person
may appeal to the administrator in such a manner and
within such
period as may be prescribed by regulation, against such decision.
However, where the eighteenth respondent has
conceded that the
rezonings are unlawful, an internal appeal would serve no purpose.
The outcome would have been the same as the
concession made.
[38]
The applicant avers that there is no internal appeal for the
rezonings and consents granted by
the third respondent. The
rezonings by both those respondents are inextricably wound up.
Such render this case to be
one where exceptional circumstances exist
which justif
ies
exemption of the
applicant from exhausting internal remedies.
[39]
The argument on behalf of the second, fourth, fifth and sixth
respondents on exhaustion of internal
remedies seem
s
to suggest that the applicant seeks justification for its failure, by
relying on the lapse of time period within which it ought
to have
pursued the internal remedies. The applicant has not furnished
information as to why it could not timeously exhaust
its internal
remedies.
[40]
In
Nichol and Another v Registrar of Pension Funds and Others
2008 (1) (SA) 383 (SCA) it was explained as to what the applicant for
exemption in terms of section 7(2)(
c
)
would have to satisfy the court with, in order to be successful.
Furthermore, what constitutes exceptional circumstances
that warrant
exemption from exhaustion of internal remedies
was
said.
Firstly, the applicant would have to satisfy court
that exceptional circumstances exist and that it is in the interest
of justice
that exemption be given. The exceptional
circumstances upon which reliance is placed in support of an
application for exemption
in terms of section 7(2)(
c
)
should primarily be the facts and circumstances existing
before or at the time of the institution of review proceedings.
This
does not mean that the court may not, in principle, take into
consideration events occurring after the launch of the proceedings.
Finally, exceptional circumstances which might justify an exemption
in terms of section 7(2
)(
c
)
would exist where the internal remedy would not be able to
provide the applicant with effective redress for the complaint.
[41]
It is common cause that the administrative decisions sought to be
reviewed are those of the third
and eighteenth respondents. In
my view, even if the applicant could pursue an internal appeal and
get redress from the eighteenth
respondent, no similar remedy exists
in as far as the third respondent’s decisions are concerned.
In
Nichols
(
supra),
at
paragraph 24, it is stated that the strong
merits of the grounds for review do not
per
se
constitute exceptional circumstances as that would
defeat the purpose of internal review. However, in the
circumstances
of this case it cannot be avoided that such play a role
in determining whether to grant the application for exemption or
not.
Both those respondents have conceded that their decisions
are unlawful. The eighteenth respondent’s concession is
contained
in an undated letter written by its legal representatives.
The said letter is attached to the second, fourth, fifth and sixth
respondents’ answering affidavit.
[42]
In my view, the substantial part of what would have constituted the
internal remedy sought from
the administrator was communicated
already by the time the second, fourth, fifth and sixth respondents’
answering affidavit
was filed. Furthermore, the applicant would
still have had to seek direct review from court in as far as the
third respondent’s
decisions are concerned. All the
decisions relate to the same land. The merits of the grounds
for review reveal that,
what the legislature had intended to benefit
the landless citizens
;
was irregularity
diverted to perpetuate luxurious commercial interests. Also,
agricultural land was rezoned without minister’s
designation in
terms of provisions of section 2 of the Act. In the light of the
above considerations, I am persuaded that the interest
of justice
justify the granting of exemption from exhausting internal remedies.
I therefore grant the exemption in terms
of section 7(2)(
c
)
of PAJA.
RIGHT
OF PRE-EMPTION
Prescription
[43]
With regard to prescription raised against the applicant’s
right of pre-emption, I have
already found that the applicant had
knowledge of all the material facts to complete his cause of action
early 2009. The
application was launched in September 2011.
The three year period provided for in section 11(
d
)
of the
P
rescription Act, 68 of
1969 had not expired.
Enforcement
of applicant’s right of pre-emption
[44]
It is common cause that the applicant had a pre-emptive right against
the land. It is also
common cause that the said pre-emptive
right was not registered against the property’s title deed.
It is trite law
that the purchaser of immovable property who acquires
clean title is not likely to be held bound by an unregistered
servitude claimed
in relation to that property. However, if
such purchaser has knowledge, the said right is enforceable against
the said purchaser.
[45]
The applicant avers that, according to the record filed by the third
respondent, on 31 August
2017, the first and second respondents had
on behalf of the fourth respondent, amongst others, submitted the
agreement of sale
between applicant and first respondent. The
deed of sale contained the clause with right of pre-emption. On
27 October
2006 the first and second respondents executed a
shareholder’s agreement, amongst others indicating that there
were subdivisions
that were planned. The fourth, fifth,
seventh, eighth to eleventh respondents were to benefit from the
agreement. The
applicant submits that these respondents were
therefore not innocent parties. They are integral part of the
shareholders’
agreement and they benefited from the agreement.
With regard to the sixth respondent, at the time the subdivisions
took place
its directors were the first and second respondents.
[46]
It is submitted on behalf of the second, fourth, fifth and sixth
respondents that it was not
possible for the third parties who were
not privy to the provisions of the deed of sale between the parties
to become aware of
the existence of the pre-emptive right. The
applicant’s personal right therefore cannot be enforceable
against the
third parties who had no knowledge of the personal right
of pre-emption.
[47]
The tenth and eleventh respondents allege that they are
bona
fide
owners who were not
aware of the applicant’s pre-emptive right. The applicant
has not made out a case that they actually
bear knowledge of the
applicant’s right of pre-emption. The application for the
interim interdict was not successful
against them together with the
fifth and sixth respondents. Only the first, second and seventh
respondents were interdicted
from disposing, transferring,
encumbering or effecting any improvements or developments to the
land, pending the review application.
The tenth and eleventh
respondents were also held not to have knowledge of the right of
pre-emption.
[48]
The twelfth and thirteenth respondents also aver that they were not
aware of the pre-emptive
right. Their assertion has not been
disputed.
[49]
As regards to the first, second, fourth, fifth, sixth, seventh eighth
and ninth respondents,
there is information contained in the
shareholder’s agreement which came to light on 31 August 2017,
upon filing of the record
by the third respondent in these
proceedings. The said information, amongst others, is to
the effect that there would
be subdivisions, portions of which would
be transferred to the fourth, fifth, seventh, eighth, ninth, tenth
and eleventh respondents.
The agreement was executed nine
months before 12 February 2008, when the transfers to the benefitting
respondents took place. I
agree that after this information
emerged, most of those respondents can no longer be said to have been
innocent purchasers.
They benefited directly from the
shareholder’s agreement through transfers of subdivided
portions of the land. Those
respondents are the following:
the
fourth and sixth respondents, whose directors were the first and
second respondents who were also the executors of the shareholder’s
agreement and authors of all the beneficiary scheme; the seventh
respondent in whom the first respondent and his family members
had an
interest.
[50]
In the circumstances, the right of pre-emption is enforceable against
the first, second, fourth,
fifth, sixth, seventh, eighth and ninth
respondents. This was also conceded to on behalf of the
second, fourth, fifth
and sixth respondents. The said
concession includes the first respondent as well.
[51]
As regards the tenth and eleventh respondents, without evidence of a
connection with the first
and second respondent
s
,
or clear evidence that they were aware of the shareholder’s
agreement or deed of sale between the applicant and first respondent,
I am unable to conclude that they were aware of the right of
pre-emption.
REVIEW
APPLICATION
[52]
The second, fourth, fifth and sixth respondents do not strenuously
dispute that there were irregularities
in the process of the
subdivision and rezoning of the farm. They aver that there were
some deficiencies, however, they submit
that the court still retains
a discretion with regard to the setting aside of an invalid
administrative act. Further, they
state that the success of the
application would mean that all the approvals and transfers of the
various properties would have
to be set aside. The intended sale of
3million to the fourth respondent was before improvements were
effected on the property.
It would be extremely prejudicial to
the respondents who had no knowledge of pre-emptive right, for them
to spend a lot of money
to the tune of about 50 million rand on the
resort and give it to the applicant only for 3 million rand. If
the various transferees
could not be compensated for all the costs
they incurred, that would be tantamount to expropriation without
compensation.
Further, if the applicant does not succeed to
declare all subdivisions and transfers of various portions and place
the farm in
a position it was before the subdivisions and transfers
took place, the application would serve no purpose. The
whole
farm cannot be tendered to the applicant.
[53]
They aver further, the decisions remain valid until set aside.
If they are sought to be
set aside after a long time, they would only
be set aside in cases where there are special circumstances.
The third respondent
has not tendered to reverse his decision.
Setting aside decisions after a long time also offends the principle
of finality
of administrative decisions. This principle was
reiterated in
Notya
wa
v
Makana Municipality and others
[
2017
]
(4)
All SA
533 (ECG). It was
stated that in matters where review of administrative decision is
sought, finality is all important.
[54]
On behalf of the tenth to the thirteenth respondents, it is submitted
that the decisions that
have not been set aside have legal
consequences that cannot simply be overlooked. The sale of the
properties by the fourth
respondent
is
valid
until set aside. These consequences have to be taken into
account when considering the making of declaration orders
about the
administrative actions taken in this case. It must be
considered that the said respondents paid for the property
and they
made improvements to them. Further, it should also be
considered whether they would be re-imbursed. In
MEC for
Health
,
Eastern Cape and
Another v
Kirland
Investments
(Pty) Ltd t/a Eye and Laser Institute
2014 (3) SA 481
(CC) at
paragraph
65
it was held:
The decision, despite being defective,
may have consequences that may make it undesirable or even impossible
to set aside.
That demands a proper process, in which all
factors for and against are properly weighed”.
[55]
The eighteenth respondent filed notice to oppose the application on
22 August 2017, indicating
its intention to oppose the costs order
only. It did not file an answering affidavit. It only
filed the record of the
decisions it took for rezoning and
subdivisions, after it was compelled by this court. With regard
to the main application,
during the period between the filing of the
notice of application on 20 September 2011 and the filing of the
second, fourth, fifth
and sixth respondents’ answering
affidavit dated 30 October 2017, the eighteenth respondent had
already communicated its
concession to the order for review.
[56]
The irregularities, flaws and noncompliance with statutory
requirements in the process of seeking
exemption for subdivisions,
rezoning and obtaining of financial assistance for acquisition of
land tenure rights are common cause
in this matter. The third
respondent conceded that the designation of the property was not in
accordance with the Act.
The
A
ct
was not complied with in that, there was no notice issued in the
government gazette and or publication of the proposed development
in
the local newspaper. No notices were given to adjoining
landowners. The application for the subdivision was not
made to
the departments of agriculture and environmental affairs.
Furthermore, it was incorrect for the third respondent
to rely on
section 10(3) of the Act to approve the rezoning and subdivision of
agricultural land other than land designated
by the minister in terms
of section 2 of the Act. I have already referred to the
eighteenth respondent’s concession.
The respondents, earlier in
the interim relief proceedings also conceded that the Act was not
meant for upper market commercial
developments.
[57]
Furthermore, there is clear noncompliance with statutory prescripts
in the manner in which the
impugned administrative decision were
taken. False representations were made, in order to propel
undue concessions and approvals
by the third respondent. The
statute that was meant to benefit the landless and destitute was
abused, with the aid of some
officials of the third respondent.
A message has to be consistently sent out, as the Constitutional
Court has always done,
as it is apparent in
Asla
(
supra)
,
and cases referred thereto. The courts will not be slow
in offering means for redress and show their distaste, in
circumstances
where there has been utter disregard of statutory
requirements, misrepresentation and abuse of statutory provisions.
[58]
I have considered the importance of ensuring that there is finality
in administrative decisions.
I have also balanced the
consequences of declaring the third and eighteenth respondents’
conduct unlawful. This is
particularly with regard to those
respondents correctly benefitted in terms of the statute designed for
the provision of land tenure
and those who are
bona fide
purchasers. Having done so, with the conduct of the first,
second respondents, assisted by the very officials of the third
respondent in certain instances, I could not come to any other
conclusion other than declaring a clearly unlawful conduct as being
unlawful.
[59]
The nature of the relief I grant ought to take into account that
there are respondents who I
could not find that they were aware of
the applicant’s right as well. They expended on the
property. I am unable
to determine if the valuations by
Boshoff are correct, in the light of their being disputed by
the applicant.
I will leave this to the respective litigants to
resolve at an appropriate time, without interfering with compensatory
rights or
the like which they may otherwise have.
[60]
I do not agree with the respondents who submitted that if the setting
aside of the transfers
not successful against all respondents the
order of invalidity would serve no purpose. In my view,
if the declaration
of invalidity is made, it is still open to the
affected litigants to seek resolution about how the
bona fide
purchasers who acquired rights, could be appropriately compensated
for expending, following unlawful acts. Unlawful acts
can still
give rise to valid consequences. The court in the exercise of
its discretion can still come to a finding that it
is not just and
equitable to set aside the administrative action or make specific
orders in relation to a more appropriate remedy.
[61]
All the rezonings and subdivisions are unlawful. The court in
its discretion is not inclined
to set aside the subsequent transfers
to the tenth to seventeenth respondents. This is on the basis
that, it has either not
been established that, in respect of some of
those respondents, they were aware of pre-emptive right or because
others were the
beneficiaries the Act was intended to benefit.
In my view, the respondents’ involvement cannot be taken as
having been
intended to defeat the applicant’s pre-emptive
right. They also have no connection with the circumvention of
the statutory
provisions.
[62]
As regards costs, ordinarily, costs follow the result, I find no
basis to deviate from this principle.
It is only to a certain
extent, in relation to the eighteenth respondent that, the eighteenth
respondent has made out a case.
For me to approach the issue of
costs differently than the rest of other unsuccessful respondents.
I find merit in
the submission that the eighteenth respondent
ought to be held liable for costs up to the date of filing of the
first, fourth,
fifth and sixth respondents’ answering
affidavit. This is when it was known by everyone involved in
the litigation
that it concedes to the granting of the review
application. The eighteenth respondent’s notice to oppose
indicated
that the application would be opposed only in respect of
costs. There was no answering affidavit filed in respect of the
said respondent. With regard to the rest of other respondents
the applicant is successful in having the decisions declared
unlawful, invalid and in respect of most respondents to have the
decision set aside. In relation to the
bona fide
purchasers,
no order will be made as to how the compensatory process should be
undertaken following the declaration of invalidity
of the impugned
decisions.
In
the result, the following order is made;
1. That the third
respondent’s purported approval of the subdivision diagram (now
registered as General
Plan No. 2641/2007 in the Deed’s
Registry, Cape Town) in respect of Portion 11 of the Farm Vista No.
367, situate in the
Sundays River Municipality, administrative
district of Alexandria, Province of the Eastern Cape (the property)
recorded on annexure
“E” (dated 13 November 2006) to the
founding affidavit of Michael Harrison Knight is hereby declared to
be invalid.
2. That the
eighteenth respondent’s purported approval of the subdivisions
of the aforesaid property in
terms of
s
ection
23 of the Land Use Planning Ordinance, 15 of 1985, dated 9
October 2007 recorded on annexure “G” (dated
9 October
2007) to the founding affidavit of Michael Harrison Knight, is hereby
declared to be invalid.
3. That the
eighteenth respondent’s purported rezoning of the aforesaid
subdivisions of the property from
Agricultural use to Resort 2 use,
on 18 June 2008 as recorded on annexure “J” to the
founding affidavit of Michael
Harrison Knight is hereby declared to
be invalid.
4. That sales and
transfers of subdivided portions from the fourth to the second,
fifth, sixth, seventh, eighth
and ninth respondents are declared to
be null void by virtue of section 3 of subdivision of Agricultural
Land Act 70 of 1970.
5. The Registrar of Deeds is
ordered to expunge all transactions registered in respect of the
transfers of property from
the first respondent to the aforesaid
respondents and is likewise ordered to expunge the registration of
the bonds registered in
favour of the twentieth, twenty-first and
twenty-second respondents, if any, only in respect of those
respondents.
6. That the first
respondent be ordered to sign all documents necessary to effect
transfer of the portions of the property
transferred to
aforementioned respondents, within 30 days of being called upon to do
so by the applicant’s conveyancers against
payment of purchase
price of 3 million rand on transfer, failing compliance with this
order, that the Sheriff of the district in
which the property situate
be authorised to do so on behalf of the first respondent.
7. The declaration of
invalidity shall not have the effect of affecting the rights of the
tenth to the thirteenth
respondent, if any, in relation to
due compensation for
their expenses.
8. That the first, second,
third, fourth, fifth, sixth and seventh respondents jointly and
severally, be ordered to pay the
costs of this application.
9. The eighteenth
respondent is ordered to pay the costs of the application up to 30
October 2017 jointly and severally
with the first, second, third,
fourth, fifth, sixth and seventh respondents.
___________________________________
B
MAJIKI
JUDGE
OF THE HIGH COURT
Counsel
for the applicant
: Mr
O. Ronaasen SC and Ms M.
Morgan
Instructed
by
: Messrs
Whitesides Attorneys
58 African Street
GRAHAMSTOWN
Counsel
for the second, fourth
and
sixth respondents
: Mr
Jooster
Instructed
by
: Messrs
Greyvestein & Nortier Attorneys
c/o
Cloete & Company
GRAHAMSTOWN
Counsel
for the Eighteenth Respondent: Ms Beard and Mr Marubini
Instructed
by
: Messrs Netteltons
118A
High Street
GRAHAMSTOWN