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[2016] ZAFSHC 116
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Vardakos and Others v Free State Gambling and Liqour Authority and Others (A265/2013) [2016] ZAFSHC 116 (30 June 2016)
IN
THE HIGH COURT OF SOUTH AFRICA,
FREE
STATE
DIVISION,
BLOEMFONTEIN
Case
No. : A265/2013
In the application
between:-
VASILIOS
VARDAKOS
1
st
Applicant
VALERIE
VASSILEV VASSILEV
2
nd
Applicant
KYRIAKOS
VARDAKOS
3
rd
Applicant
and
FREE
STATE GAMBLING & LIQUOR AUTHORITY
1
st
Respondent
THE CHIEF
EXECUTIVE, FREE STATE
GAMBLING
& LIQUOR AUTHORITY
2
nd
Respondent
CHAIRPERSON OF THE
FREE STATE
GAMBLING
& LIQUOR AUTHORITY
3
rd
Respondent
HEARD
ON:
13
JUNE 2016
JUDGMENT
BY:
VAN
ZYL, J
et
MOTIMELE, AJ
DELIVERED
ON:
30
JUNE 2016
[1]
The Free State Gambling and Liquor Authority (“the Authority”)
issued an advertisement in the Provincial Gazette
dated 19 November
2010 and the Daily Sun newspaper of the same date, inviting
applications from any persons who are interested
to hold bookmaker
licences in the Free State Province. The applicants applied
pursuant to this notice.
[2] The notice read,
inter alia, that:
i)
The application be made on a prescribed from;
ii)
All applicants are invited to tender payment of a lump sum for the
acquisition of the licence;
and
iii)
A non-refundable application fee of R5500.00 was payable upon
submission of the application forms.
Furthermore,
the Authority stated seven (7) areas, within which it has bookmaker
licenses available, and advise that only two operators
will be
allocated per area.
[3]
Applications were received and acknowledged on the 31 March 2011.
Thereafter inspections were carried out at the proposed
premises, and
no objections were raised against any of the applications.
[4] On the 24 May 2013,
the Authority wrote to the Applicants and advised them that the
applications for a bookmaker’s licence,
was considered by the
board, but refused in terms of section 65(4)(a) of the Free State
Gambling and Liquor Act, 6 of 2010 (“the
Act”) due to the
following reason(s):
i)
That the Applicants did not tender a lump sum for the acquisition of
a Bookmaker Licence
in terms of the notice inviting the applications,
read with section 78(1)(b) of the Act.
ii)
Additional reasons were given in respect of other Applicants.
In respect of the Second
Applicant, it was stated that the proposed
premises are next to an already existing bookmaker. Third
Applicant was advised
that his application was not accompanied by the
approval or representations of the Local Authority within whose area
of jurisdiction
premises, in respect of which the application is
made, are situated.
The
Board then concluded, that in light of the above it is its view, that
the applications did not meet the legislative prescripts,
and that
non-compliance with the prescripts as outlined by the Act constitute
a material defect, and the applications are therefore
refused.
[5] Applicants launched
an application in terms of Rule 53 of the Uniform Rules of Court read
with section 6 of the Promotion of
Administrative Justice Act, 3 of
2000 (“PAJA”), to obtain an order reviewing and setting
aside the decision of the
Authority, not to grant the bookmaker’s
licence to the Applicants.
In
addition the court was requested to remit the matter back to the
Authority for reconsideration.
[6] In the main, the
legal basis for the review application was that:
i)
The action by the Authority was procedurally unfair in that the
Applicants did not
receive notice of the intended decision;
ii)
Applicants were not afforded the opportunity to make representation
in respect of the proposed
decision by the authority;
iii)
The decision to refuse the application was influenced by an error in
law;
iv)
The action taken was arbitrarily with no regard for the import or the
nature of the invitation
to provide a lump sum;
v)
The action was taken for a reason not authorised by the empowering
statute.
In
respect of the other grounds of disqualification, Applicants
contended that they complied, alternative, that it is not a
legislative
disqualification, and accordingly without merit and bad
in law.
COUNTER REVIEW
[7]
The Authority instituted a counter-application seeking to review and
set aside the decision, process and notices inviting applications
for
bookmaker licences (“the notices”), with an order
directing that the process recommence
de
novo
.
[8] It is contended on
behalf of the Authority that the notices are defective, in that they
did not set out;
i)
The evaluation criteria referred to in section 78(1) of the Act; and
ii)
A lump sum needed to be paid.
That
the illegality consequently taints the administrative process which
took place including the evaluation of the applications
delivered in
response to the notices and the decisions regarding the applications
for bookmaker licences.
[9]
The Authority’s review application is in terms of PAJA and the
court’s inherent right to review administration actions
and
decisions based on rationality and legality.
APPLICATION OUT OF
TIME (CONDONATION)
[10]
The Applicants raised the issue of the counter-review being out of
time, or launched after an inordinate delay which is unreasonable,
without asking for condonation. This issue was raised for the
first time in their heads of argument without being canvassed
in
their affidavits at all. The result is that the Respondents
could not respond to that in their reply. In the event
of a
party raising an issue for the first time in its heads of argument,
and without canvassing same in the affidavits filed, the
issue is
similar in status with any point raised by the court
mero
motu
.
In other words it is a point by the court and not the party, and this
might have a bearing on a cost order in event that
it is successfully
raised.
[11]
The Respondents contend that the counter-review is not out of time.
The process was multi staged and it is both possible
and desirable to
treat it as such and view it holistically; alternatively that in any
event, the Authority only received legal
advise relating to the
validity of the notice after the Applicants instituted the review
application. In consequence, the
argument goes, that the
counter-review on legality at the very least, was instituted within a
reasonable time.
[12] I
find that, the counter-review based on legality and rationality was
brought within a reasonable time as soon as the illegality
was
pointed out. I find solace in this view, in that the principle
of legality is one of the foundational principles of our
constitution. Failure to canvas this point in the papers
precludes the Applicant from seeking to raise it, in ambush in their
heads of argument. Had the point being raised earlier the
Authority would have dealt with the facts relevant to the issue
of
delay and also sought an extension of time or condonation. At
the beginning of the arguments, counsel informed us that
they have
agreed that the Respondents have the duty to begin.
THE NOTICE
[13]
Respondents contend that the notice is invalid in that it did not
comply with the provisions of section 78(1) of the Act and
this
vitiated the whole of the application process with the result that no
valid licence could be issued pursuant to that process.
[14]
The court also cannot issue a valid licence as claimed by the
Applicants, inasmuch as the court can only exercise the powers
which
the Authority enjoyed, and since the Authority did not have the power
to issue the licence neither can the court.
[15] I proceed to look
closely at the notice. Section 78(1) proves that:
“
No
person may apply for a bookmaker’s licence other than in
response to a notice published in the
Provincial
Gazette
and
the media by the Authority, inviting applications and which notice
may
(underline for emphasis) state—
(
a
)
the number of licences to be issued and the areas to which the
licences will relate;
(
b
)
an invitation to tender payment of a lump sum for the acquisition of
a licence; and
(
c
)
the evaluation criteria to be applied.
”
[16]
The Applicants contends that section 78(1)(c) is couched not in
peremptory terms, but directory. It does not create an
obligation on the Applicants. In other words section 78(1)(c)
created no more than an invitation (no obligation) to tender
a
non-specified amount as a lump sum for the acquisition of the
licence. Nothing within the legislative scheme of things
justify an argument that the failure to tender an amount would be a
material omission on the part of the Applicants.
[17]
It is further submitted on behalf of the Applicants that the
Authority erred by not exercising its discretion in terms of section
68(3) by either holding a hearing with the applicants or informing
the applicants to make submission on the lump sum.
[18]
The Authority on the other hand contends that the Applicants’
interpretation proceeds from a juridically unsound premise.
The
proper approach to the interpretation of the language used in an
enactment is not to look at a single word and then apply what
is seen
as its ordinary meaning, instead the process of interpretation
involves a proper consideration of the context in which
the language
has been used and by applying a purposive approach. To hold
otherwise, one will be guilty of what Kenbridge
AJ, (as he then was)
pointed out any other approach is divination rather than
interpretation. See
S
v Zuma and Others
[1995] ZACC 1
;
1995 (2) SA 642
(CC)
(1995 (1) SACR 568
;
1995 (4) BCLR 401)
paras
[17] and [18]. This was recently affirmed by Wallace JA in
Natal
Joint Municipal Pension Fund v Endumeni Municipality
2012 (4) SA 593
(SCA) at [18]. He said:
“
Interpretation
is the process of attributing meaning to the words used in a
document, be it legislation, some other statutory instrument,
or
contract having regard to the context provided by reading the
particular provision or provisions in the light of the document
as a
whole and the circumstances attendant upon its coming into
existence. Whatever the nature of the document, consideration
must be given to the language used in the light of the ordinary rules
of grammar and syntax; the context in which the provision
appears;
the apparent purpose to which it is directed and the material known
to those responsible for its production. Where
more than one
meaning is possible each possibility must be weighed in the light of
all these factors. The process is objective
not subjective.
A sensible meaning is to be preferred to one that leads to insensible
or unbusinesslike results or undermines
the apparent purpose of the
document. Judges must be alert to, and guard against, the
temptation to substitute what they
regard as reasonable, sensible or
businesslike for the words actually used. To do so in regard to
a statute or statutory
instrument is to cross the divide between
interpretation and legislation. In a contractual context it is
to make a contract
for the parties other than the one they in fact
made. The ‘inevitable point of departure it the language
of the provision
itself’, read in context and having regard to
the purpose of the provision and the background to the preparation
and production
of the document.
”
See
also
Cool
Ideas 1188 CC v Hubbard and Another
2014 (4) SA 474
(CC) at [28].
[19]
The court has held that the use of permissive language, such as “may”
has to be interpreted to mean “must”.
See
Van
Rooyen and Others v The State and Others (General Council of the Bar
of South Africa Intervening)
2002 (5) SA 246
(CC) at [180]. But this is not an issue about
legal precedent, instead it is an issue of interpretation, and as has
been
said “context is everything” in attaching meaning to
the language of an enactment. See
KPMG
Chartered Accountants (SA) v Securefin Ltd and Another
2009 (4) SA 399
(SCA) at [39]. Although this was said in the
context of interpreting the language of a contract, it is my view
that it is
equally applicable to statutory provisions.
[20]
The proper interpretation of section 78(1) requires the purpose and
objectives of the section to be taken into account, so
that the
interpretation is given to the section achieves that purpose.
Interested persons ought to be notified of the number
of licences to
be issued, the areas to which the licences will relate, the lump sum
required and the evaluation criteria to be
applied. The
legislature has prescribed these details as the minimum information
that should be disclosed in the notice,
to achieve the objects of the
Act.
[21]
The construction placed by the Applicants on section 78(1) of the Act
is wholly untenable. Such a construction will have
the opposite
effect to what the legislation was intended to achieve. In
short the notice would be bereft of any meaningful
information to
assist an interested person to make an informed decision to apply for
the licence. Such a notice would not
pass the muster. The
Legislature does not intend absurd results, but intends to advance
the public interest. Words
in a particular section ought to be
interpreted purposively and not abstractly by divorcing the language
from the context.
It is trite that the question of validity of
the notice must be determined as follows:
“
In
deciding whether there has been a compliance with the injunction the
object sought to be achieved and the question of whether
this object
has been achieved are of importance.
”
See
Maharaj
and Others v Rampersad
1964 (4) SA 638
(A) at 646C;
Coalcor
(Cape) (Pty) Ltd V Boiler Efficiency Services CC
1990 (4) SA 349
(C) at 356 C-D. Furthermore, this
interpretation is supported by section 78(2) of the Act, which
provides that the bookmaker’s
licence must only be granted to a
person who meets the prescribed requirements. It would defeat
the purpose of this provision
if the notice did not inform the
applicant of the prescribed requirements.
[22]
In the result, I hold that section 78(1) of the Act, ought to be
interpreted purposively to require the notice to include details
referred to in the section.
ORDER
I,
therefore make the following order:
1.
The counter-review succeeds and the decision, the process and the
notices issued by the Authority in terms
of section 78(1) are hereby
reviewed and set aside.
2.
The Authority is directed to recommence the process de novo.
3.
The review application is dismissed.
4.
The Applicants to pay the costs of the applications, jointly and
severally, such costs to include those consequent
upon the employment
of two counsel.
___________________
A.M.M.
MOTIMELE, AJ
I
agree.
___________________
C.
VAN ZYL, J
On
behalf of Applicants: Adv N
Jagga
Instructed
by:
Honey Attorneys
BLOEMFONTEIN
On
behalf of Respondents: Adv N Singh SC with Adv DJ Saks
Instructed
by:
Matsepes
Inc.
BLOEMFONTEIN
/wm