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[2016] ZANCHC 36
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Liciano Coal (Pty) Ltd v Assmang Ltd and Another (2406/2016) [2016] ZANCHC 36 (2 December 2016)
IN
THE HIGH COURT OF SOUTH AFRICA
(NORTHERN
CAPE HIGH COURT, KIMBERLEY)
CASE
NO.: 240612016
Date
heard: 10-11-2016
Date
delivered: 02-12-2016
In
the matter between:
LICIANO
COAL (PTY)
LTD
Applicant
And
ASSMANG
LTD 1
st
Respondent
OCHRE
SHIMMER TRADE AND INVEST 78 (PTY)
LTD 2
nd
Respondent
CORAM:
WILLIAMS J:
J
U D G M E N T
WILLIAMS
J:
1.
On 10 November 2016, after hearing argument in this application which
was brought on an urgent basis, I made the following orders:
"1)
That first respondent restore the applicant's access to the property
known as FARM DOORNFONTEIN 446 forthwith;
2)
That first
respondent
be
interdicted
and
restrained
from refusing
or in any way prohibiting
the applicant access to the
property known as
FARM DOORNFONTEIN 446; and
3)
That first
respondent
pay
the costs
of the
application
on the party and
party scale."
I
indicated that I would provide reasons for the orders in due course.
These now follow.
2.
The applicant Liciano Coal (Pty) Ltd, entered into a written
agreement with the second respondent Ochre Shimmer Trade and Invest
78 (Pty) Ltd (Ochre Shimmer), which held a prospecting right over the
property of the first respondent Assmang (Pty) Ltd (Assmang),
on 12
May 2014 and in terms of which Ochre Shimmer conferred use and
enjoyment of its prospecting right over the property to the
applicant.
3.
During 2015 Ochre Shimmer purported to cancel the agreement with the
applicant due to non-compliance by the applicant with certain
of the
terms thereof and locked the applicant out of the property. This led
to the applicant bringing an urgent application before
Pakati J on 12
June 2015 under case no 1060/15 for
inter alia
access to the
property. Pakati J on 21 August 2015 held (in the main) that Ochre
Shimmer had prematurely cancelled the agreement,
having not complied
with the requisite notice to remedy the breach before cancellation in
terms of Clause 8.2 of the agreement
between the applicant and Ochre
Shimmer and made the following orders:
1.
The first respondent,
Ochreshimmer,
is
ordered
to comply
with its
obligations under and
in terms of
the
agreement between the applicant
,
Liciano Coal,
and
the
first
respondent
dated 12
May
2014 set out in Annexure
"
A"
to the Founding Affidavit.
2.
The respondents,
Ochreshimmer,
Assmang
and
Spi
Mining
are
ordered
to
give
the
a
pplicant access
to
the
prospecting
area
in respect of
which the first respondent
is the holder
of
a
prospecting
right
granted by the South African Department of Mineral Resources under
Protocol No. 07512009 conferred in terms of section
20 of the Mineral
and Petroleum Resources Development Act, 28 of 2002 (as amended).
3.
The applicant
is
ordered
to
comply
with its obligations
in
terms
of the
agreement,
and
in
particular
to
make
payment
to
the
first respondent
of
the sum
of R1 387
700.00 plus
VAT,
such payment
to
be
made
within 30 (thirty)
days
of this
order, into the
trust
account of the
first respondent's attorneys.
4.
The aforesaid relief, save for any payments
made
by the applicant to the first respondent
,
operate
as an
interim
interdict pending
the
outcome
of
the
action
instituted
by
the
applicant
against
the
first respondent
under
Case
No
.
1582
7
1
2015
on
29
April 2015
out
of the South
Gauteng High Court
,
subject to the following
conditions
:
4.1
That in
the
course
of
carrying
out
the
prospecting
works
under
and
in
terms
of
the
agreement
the applicant
is
ordered
to
provide
the
first
respondent with
weighbridge
reports
accounting to
the
first
respondent
for
all
ore
removed from the said prospecting
area
;
4.2
That the applicant
gives
an
observer
appointed
by
the
first respondent
access
to
the
prospecting site
at
any reasonable
time
to
inspect
the
applicant's
weighbridge reports
:
Provided
that
the
first
respondent
'
s
attorney
gives
the applicant's
attorney
at least
12
hours
'
notice of an
intended
inspection
setting out the name of the person
who will
carry
out
the
inspection
and
the
date
and
time
of
the
proposed
inspection
;
4.3
That the
applicant
makes
timeous
payment
to the first respondent
of all
amounts due to the first
respondent
under and
in
terms
of
the
agreement
for
the
period
of
the
operation of this interim
interdict
.
5.
The
first respondent
is ordered
to
pay
the costs of this
application
.
6.
The
applicant
is ordered
to
pay
to
the first respondent,
Ochreshimmer, the wasted costs of 02 June 2015
.
"
4.
In the application before Pakati J, Assmang was cited as the second
respondent by virtue of its being the owner of the property
and the
concomitant interest it might have had in the matter. Assmang did not
oppose that application and abided with the decision
of the court.
5.
In terms of paragraph 3 of the order of Pakati J, the applicant had
to make payment to Ochre Shimmer in the amount of R1
387 700.00
plus VAT within 30 days of the order.
6.
The applicant in its founding affidavit herein, deposed to by Ms
Licia Motsepe, the sole shareholder of the applicant, states
that due
to financial constraints such payment could only be made to Ochre
Shimmer during September 2016, almost 1year and 1 month
after the
date of the order, therefore 1 year late.
7.
During the time before payment the applicant had been denied access
to the property - which the applicant had accepted. However
after
payment had been made and when applicant attempted to access the
property on 18 October 2016, it discovered that the entrance
gate was
locked and access denied by Assmang. During a telephonic conservation
with the chief executive officer of Assmang, Mr
Mark Oosthuizen,
Motsepe was informed that the applicant will not be allowed access to
the property.
8.
Motsepe states that she thereafter tried on numerous occasions to
engage with Oosthuizen
regarding access, but that
Assmang's stance remained the same despite the order of Pakati
J and
the applicant's compliance therewith. In the mean time the
applicant's losses in terms of equipment it had sourced to commence
prospecting amount to R35 000,00 per day and it estimates loss in
productivity at R4 million per month as a result of Assmang denying
it access to the property. This situation is compounded by the
fact that the agreement between Ochre Shimmer and the applicant
expires on 24 January 2017, which at the time the application was
launched left the applicant with less than three months in which
to
exercise its rights in terms of the agreement.
9.
No relief is sought against Ochre Shimmer - which the applicant
states has actually assisted it in regaining access. Ochre Shimmer,
the second respondent herein does not oppose this application.
10.
Assmang in its opposing papers deposed to by Oosthuizen, avers that
the order of Pakati J has lapsed due to non fulfilment of
the
condition contained in paragraph 4 read with subparagraph 4.3
thereof. In addition it avers that the applicant had entered
into two
agreements subsequent to the order of Pakati J in which the applicant
assumed several obligations prior to it being re-admitted
to the
property - which agreements the applicant failed to disclose in the
founding papers.
The
order of Pakati J
11.
Assmang contends that since payment of the amount
of R13 87 700.00 plus VAT had been made a year late,
there had been
non-compliance with the condition contained in sub paragraph 4.3
of the order resulting in the order of Pakati
J having lapsed.
12.
On a proper reading of paragraph 4 of the order however, it excludes
the payment of the amount of R1 387 700.00 from the operation
of the
interim interdict. The payments referred to in sub-paragraph 4.3 are
payments which would become due during the period of
the operation of
the interim interdict, which was granted pending the outcome of an
action instituted in the South Gauteng High
Court. These payments do
not appear to be an issue since the applicant in any event did not
pursue its access to the property and
its operations until it had
paid the amount of R1 387 700.00 plus VAT. Assmang cannot rely on the
applicant's late payment of the
above amount for its refusal to allow
the applicant access to the property. Payment of the stated amount
has a bearing only on
the applicant and Ochre Shimmer. Should the
applicant, for whatever reason, fail to make such payment within the
stated time, Ochre
Shimmer's remedy would be to enforce the order by
execution. It certainly would not mean that the order had lapsed.
13.
Whilst on the topic of the order of Pakati J, it should be mentioned
that
in
casu
the
applicant sought orders that Assmang and
Oosthuizen be held in contempt of that order and that a sanction
be
imposed as a result of such contempt. refused to grant these orders
on the basis that the applicant had not shown
that
Assmang's and/or Oosthuizen's non
compliance with the order had been both wilful
and
mala
fide.
In
my view there can be no doubt that the disobedience of the order was
wilful, but as was held in
Fakie
NO
vs
CCII
Systems
(Pty) Ltd
[2006] ZASCA 52
;
2006 (4) SA 326
at
333 (paragraphs 9 and 10):
"9)
The
test for when disobedience of a civil order
constitutes contempt
has come to
be
stated as whether the
breach
was
committed
'
deliberately
and
ma/a
fide
'
.
A
deliberate
disregard
is not enough, since
the
non-complier may
genuinely,
albeit
mistakenly,
believe
him-
or
herself
entitled
to
act in
the
way
claimed
to
constitute
the contempt.
In such
a
case good
faith avoids
the infraction.
Even a
refusal to comply that is objectively
unreasonable may be bona fide (though unreasonableness could evidence
Jack of good faith).
10)
These
requirements
-
that
the refusal to
obey should be both wilful
and
ma/a
fide, and that unreasonable non-compliance,
provided
it
is
bona
fide,
does
not
constitute
contempt
-
accord
with
the
broader
definition of the crime, of which non-compliance with civil orders is
a
manifestation. They
show that
the
offence
is
committed
not by mere disregard of
a
court order, but by the
deliberate and
intentional
violation of the
court
'
s dignity,
repute or authority that
this
evinces. H
o
nest
belief
that
non-compliance
i
s
justified
or
proper
is
incompatible
with
that
intent.
"
The
subsequent agreements
14.
These refer to firstly, an agreement reached between the applicant
and Ochre Shimmer following upon a meeting held by their
representatives on 7 October 2016. The written document emanating
from this meeting is titled Heads of Agreement and it was recorded
as
a working document to monitor the resumption of bulk sampling as per
the existing MOA (memorandum of agreement) and court order.
The
second agreement is alleged to be contained in the minute of a
meeting held between applicant, Ochre Shimmer and Assmang on
19
October 2016.
15.
As far as the first mentioned agreement is concerned, it should be
noted that Assmang is not a party thereto. That agreement
was
obviously entered into between Ochre Shimmer and applicant to
regulate their relationship as prospecting right holder and
contractor after payment of the outstanding money had been received
by Ochre Shimmer and prospecting could resume. Assmang cannot
rely on
a breach of an agreement (if any) to which it was not a party in
order to deny the applicant access to the property.
16.
Regarding the meeting attended by all three parties on 19 October
2016. As is apparent from the minute, the meeting was chaired
by
Oosthuizen who restated Assmang's contractual obligation towards
Ochre Shimmer and stated Assmang's intention to deal with Ochre
Shimmer only, although it would honour court orders between the
applicant and Ochre Shimmer.
17.
Oosthuizen also raised certain
"
breaches"
of contract relating to the Access agreement entered into between
Assmang and Ochre Shimmer, which Assmang expected Ochre Shimmer
to
rectify before any prospecting would be allowed on the property.
(The issues raised pertinently by Assmang
in
this application related to a railway crossing which Transnet had
prohibited from being used by heavy vehicles, the fencing
off of the
mining area and rehabilitation of the site as per the Environmental
Management Plan (EMP) and the Access agreement.
I will revert
to these issues.)
18.
The minute of this meeting records that Ochre Shimmer's
representative acknowledged the contractual shortcomings and agreed
to address all issues
19.
It is recorded that during this meeting the applicant represented by
Motsepe; agreed that they would offer a solution to the
stockpile
issue; confirmed that the fence be erected; and committed to the
rehabilitation plan
"and
the
timeline
completion
date
of
24
January
2017.”
20.
Despite having recorded that Assmang would deal solely with Ochre
Shimmer on issues of contractual obligations, the above
mentioned undertakings by the applicant are now what Assmang expects
the applicant to comply with before it will allow access to
the
property.
21.
The Access agreement between Assmang and Ochre Shimmer provides in
clause 14 thereof for the procedure to be followed in the
event of
breach of contract.
22.
In terms of clause 14 of the agreement the aggrieved party should by
written demand give the party in breach
14 days
notice to remedy the breach. Should the parties be unable to resolve
the dispute, provision is made for mediation
and if that fails,
arbitration.
23.
I think one can safely assume, no mention being made by Assmang in
its opposing affidavit of putting Ochre Shimmer or, for what
its
worth, the applicant on terms as provided for in clause 14 of the
agreement, that the provisions of clause 14 have not been
complied
with. What Assmang is in fact doing is to side-step the existing
agreement between itself and Ochre Shimmer on the basis
of some vague
undertakings and commitments made by the applicant, while Oosthuizen
himself acknowledges that the contractual obligations
are between
Assmang and Ochre Shimmer. This cannot be allowed.
24.
Though not strictly necessary for purposes of this application, I
deal briefly with the breaches alleged by Assmang since I
allowed
argument thereon.
The
issue of the railway crossing
25.
In its replying affidavit the applicant has attached correspondence
with Transnet from which it appears that Transnet would
be willing to
assist should heavy vehicles have to cross the railway line. That
should put to rest any concern Assmang has regarding
the railway
crossing.
The
issue regarding the fencing of the mining area
26.
The Access agreement between Assmang and Ochre Shimmer provides that
whenever deemed necessary Ochre Shimmer erect a fence around
the
mining area to provide protection against the entry into such area of
small or large livestock. This is typically an issue
covered by
clause 14 of the agreement and should be dealt with accordingly
Rehabilitation
of the site.
27.
The EMP submitted by Ochre Shimmer in support of its application to
the Department of Mineral Resources for a prospecting right,
estimates the duration of final rehabilitation of the site at 3
months. Assmang contends that the rehabilitation process should
in
terms of the EMP have commenced on 24 October 2016 i.e. 3 months
before the expiry of the contract between Assmang and Ochre
Shimmer.
The stance taken by Assmang is that the applicant could not be
allowed to start rehabilitation when it should in fact
have commenced
the rehabilitation process. This EMP which Assmang so heavily relies
upon, does not prohibit prospecting during
the prospecting phase and
it in fact states that rehabilitation will be done concurrently with
prospecting. In any event the Access
agreement between Assmang and
Ochre Shimmer (clause 7 thereof) provides for rehabilitation to take
place within 60 days of termination
of the agreement, for whatever
reason, failing which Assmang would be entitled to employ a third
party to attend to the rehabilitation,
the costs thereof to be paid
by Ochre Shimmer. The Access agreement also
records that Ochre Shimmer
has procured a financial guarantee
in favour of the Department of Minerals and Energy as security for
its environmental obligations.
This
reason for denying the applicant access to the property is in my view
insupportably.
28.
Mr Alli who appeared for Assmang, argued in addition that the
applicant is not entitled to interdictory relief since it has
an
alternative remedy, that of a claim for damages against
Assmang. In
Setlogelo
v
Setlogele
1914 AD 221
the requisite is stated as
"the absence of
similar protection by any other ordinary remedy".
While it may be that a claim for damages is an alternative
remedy, it is not necessarily a bar to the granting of an interdict.
(See
Peri-Urban Areas Health Board v
Sandhurst
Gardens
1965(1) SA TPD
Health Board v
Sandhurst Gardens
1965(1) SA TPD 683 at 684 G.) Would a claim for
damages constitute similar protection of the applicants rights? I
think not. It
must be noted that the granting or refusal of an
interdict is discretionary. Given the history of this matter,
Assmangs obstructive
attitude and the continuous violation of the
applicant's rights I see no reason why the applicant should be put
through the expense
and delay of an action for damages when an
interdict is the obvious remedy.
29.
I now turn to the issue of urgency. Assmang has denied that the
matter is urgent and if found to be so it contends that the
urgency
is of the applicant's own making. Firstly in making payment as per
paragraph 3 of Pakati J's order one year late and secondly
by waiting
approximately one month and one week after making such payment before
bringing this application. As already stated herein
the applicant has
explained that it was not in a position financially to make payment
to Ochre Shimmer before it did so. I have
no reason not to accept the
explanation. Regarding the period after payment, the applicant states
that it had secured equipment
for its operations from 18 October
2016. Two and a half weeks later, when negotiations with Assmang
proved fruitless, this application
was launched. Having regard to the
expiration date of the contract I was of the view that this
application was indeed urgent.
Costs
30.
The applicant being substantially successful, there existed no reason
to depart from the rule that costs follow the result.
The applicant
however sought a punitive cost order against Assmang. An award of
attorney and client costs is however not lightly
granted, and if
granted it would be on occasion where the opposing party had
displayed dishonesty, improper conduct or fraud -
generally ma/a
t
ides.
I am not of the view that this is a
proper case to award a punitive cost order
The
above are
the reasons
for the
order of
1
0
November
2016.
_______________________
CC
WILLIAMS
JUDGE
For
Applicant:
Adv. MJ Cooke
Makgahlela Mashaba
Attorneys
c/o Mervin Joel Attorneys
For
1st Respondent:
Adv. Y Alli
Edward Nathan Sonnenbergs
c/o Duncan & Rothman
Attorneys