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[2016] ZAGPPHC 175
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Mormile v State President of the Republic of SA and Others (40330/2014) [2016] ZAGPPHC 175 (4 March 2016)
IN
THE HIGH COURT OF SOUTH AFRICA
(GAUTENG
DIVISION, PRETORIA)
CASE
NUMBER: 40330/2014
In
the matter between:
SAMUELE
MORMILE
Applicant
And
THE
STATE PRESIDENT OF THE
REPUBLIC
OF
SA 1
st
Respondent
NATIONAL
MINSTER OF
FINANCE 2
nd
Respondent
LEMECK
MOLOBI 3
rd
Respondent
JUDGMENT
TOKOTA
AJ
[1]
Although the papers in this matter were not elegantly drawn the
essence of the applicant's case is that he is seeking an order
reviewing and setting aside the decision of the third respondent not
to return to the applicant the money that was seized from
him in
terms Regulation 3(6) read with Regulation 3(8) of the Exchange
Control Regulations. The nub of the grounds for review is
based on
the premise that the decision was procedurally unfair and that the
third respondent failed to take into account relevant
considerations.
[3]
The first respondent, understandably, elected to abide the decision
of the Court and the second and third respondent opposed
the
application.
[4]
There were preliminary points that were taken by the respondents'
First it is contended that there was a misjoinder and a non-joinder,
and second, that the applicant's papers did not disclose a cause of
action for review in his founding affidavit.
[5]
As for the first point of non-joinder the applicant issued a third
party notice in terms of the Uniform Rules of Court joining
the South
African Reserve Bank as the fourth respondent (the Reserve Bank).
Subsequent to that joinder Petrus Jacobus Delport,
a manager in the
Reserve Bank, filed an affidavit in which he confirmed that, in his
capacity as a Senior Manager, he was an authorised
official who took
the decision which is now subject of the review.
[6]
In my view it is not necessary to rule on the second point. Suffice
it to say that I was able to glean the grounds of the review
from the
papers. It is necessary to set out hereunder the background.
[7]
On 20 August 2013 the applicant, an Italian citizen, was travelling
in a bakkie with his brother-in-law when he arrived at a
Border Post
called Ramatlabana. This Border Post is situated between Botswana and
South Africa near Mahikeng.
[8]
At the border post he met one Kagisho Matsutswa a junior customs
inspector employed by South African Revenue Services (SARS).
He was
asked by the inspector whether he had anything to declare to which he
responded in the negative. Matsutswa, together with
one police
constable, asked permission to conduct a search in the bakkie. The
applicant raised no objection to
that search.
A bag containing South African bank notes was found. The
applicant claimed the bag and the money to be
his.
[9]
The applicant was then asked to complete a form in which the
following appears:
"Where did
you get this
money/gold/securities
from? (In
other
words what is the origin of the money?)
The recorded answer is:
"A person
he met at
a
coffee shop he
exchanged his
Euros for
Rands with
him."
[10]
The total amount was R710 000.00. According Matsutswa the applicant
explained that he was an Italian citizen and was in South
Africa on
holiday. He stated that the money was for his personal use while on
holiday. He further explained that he had a clothing
factory in
Italy. He exchanged the Euros that he brought in Johannesburg with
the assistance of his brother in law but not through
a commercial
bank.
[11]
After the money was counted he was informed that in terms Regulation
3(6) of the Exchange Control Regulations the money would
be seized
and would be handed over to the Reserve Bank for further
investigation. He was arrested, allegedly, for attempting to
bribe
officials of SARS and SAPS. His brother-in-law was informed that he
could leave. He appeared in the Regional Court the following
day and
subsequently released on bail on 26 August 2013.
[12]
After the money was counted in his presence and was found to be R710
000.00 a sum of R25 000.00 was handed back to him. This
was because
in terms of section 8.11(c)(i) of the Exchange Control Rulings
"visitors to the Republic, excluding f
o
reign
seamen,
will be permitted,
on their
arrival
in the Republic
from
countries
outside
the
CMA,
to import bank
n
otes
of
CMA
countries
up
to
a
total
value
of
R25
000.00
per
person to meet their initial expenses."
[13]
At the border post the applicant was given a letter which appears to
be a standard letter which was prepared perhaps on 18
November 2010
because it does not have a date but this date appears at the top
right corner of the letter. The letter is attached
to the founding
affidavit as one of the annexures. The attention of the court has not
been drawn to anything regarding the contents
thereof. Upon reading
the letter it invites the applicant to make representations as to why
the seized bank notes should be returned
to him.
[14]
It is now well established that "(i)t is not open to an
applicant or a respondent to merely annex to its affidavit
documentation
and to request the court to have regard to it. What is
required is the identification of the portions thereof on which
reliance
is placed and an indication of the case which is sought to
be made out on the strength thereof. If this were not so the essence
of our established practice would be destroyed. 1 The respondent also
did not deal with this letter but simply noted the contents
of the
paragraph attaching it. The letter is so important because it
purports to invite representations and the applicant maintains
that
his
rights of natural justice
have been impinged
upon by the decision
to forfeit the seized money.
[15]
In the absence of any explanation by any of the parties I will assume
that the intention of the letter was to invite the applicant
to make
representations if so advised as to why the money should be returned
to him. He has attached the letter. He failed to draw
the attention
of the Court to the portions thereof on which he relies for his cause
of action.
[16]
Subsequently, there was an exchange of correspondence between
applicant's attorneys and the Reserve Bank. There was a dispute
about
the amount seized which the applicant initially
claimed was R710 000.00. He later conceded
that it was
infact R685 000.00.
[17]
On 17 January 2014 the fourth respondent took a decision that the
money seized be forfeited to the National Revenue. It appears
from
the
letter
dated 17 January 2014 that when making the decision, Mr Deport took
into consideration the following:
(a)
That the applicant failed to declare the money when he arrived at the
border post;
(b)
The applicant gave contradictory explanations about the origin of the
money;
(c)
The applicant could not produce exemption for
bringing
such money into the Republic;
[18]
Mr Wits, who appeared for the applicant, in his written heads of
argument submitted that; (a) in terms
section
22 and 25 of the Constitution the applicant has a
right to choose the trade, occupation or profession
freely and not be
deprived of his property which includes his lawful monies; (b) that
the applicant was never requested to present
facts of undue hardship;
(c) that the deprivation of his money was procedurally unfair; (d)
that the respondent took into account
irrelevant considerations; and
(e) that the respondents acted arbitrarily.
[19]
During oral argument Mr Wits emphasized the fact that the applicant
was never requested to present facts regarding undue hardship
and
that there was procedural unfairness. On the other hand Mr Maritz SC
for the respondents submitted that the question of hardship
was
considered by the Constitutional in
Armbruster
v
Minister
of
Finance
2007
(6) SA
550 (CC).
In that
case
the
Constitutional Court said that once a person who faces forfeiture has
made representations for the return of some or all of
the money, the
decision-maker is called upon to consider whether in all the
circumstances forfeiture will cause injustice or hardship.
That case
concerned a violation of regulation 3(5) concerning the forfeiture of
foreign currency after it has been seized in terms
sub-regulations 3
or 4. Mr Maritz argued that no undue hardship had been caused by the
forfeiture as the applicant is financially
strong.
[20]
The applicant made an affidavit explaining the origin of the money
prior to the institution of these proceedings in which he
said that
he earned the money through the sales of carpets, cutlery and table
cloths in Namibia. As can be seen in paragraph 9
above, he later said
he got the money by exchanging his Euros in Johannesburg. In the form
which he completed at the Border post
he stated that he had declared
the money. On the contrary in his affidavit he conceded that he did
not declare the money. He further
stated that he cashed a sum of R300
000 at Marula Mall in Windhoek.
[21]
On the basis of the facts summarised above I find on probabilities
that;
(a)
the applicant entered the Republic being in possession of SA bank
notes amounting to R710 000;
(b)
there was no exemption by the Treasury to bring along that amount and
therefore this was in contravention of regulation
3(1)(b);
(c)
when arriving in the Republic he failed to declare that he was in
possession thereof;
(d)
R710 000 was seized and the applicant was handed back a sum of R25
000;
(e)
the applicant was afforded an opportunity to make representations
before a decision not to return the money was
made;
(f)
the applicant gave different versions as to how he came to possess
the money;
(g)
when the applicant made representations he included his personal
circumstances;
(h)
the applicant told Matsutswa that he was operating a clothing factory
in Italy;
(i)
he told his attorneys that he was a pensioner and that he had two
sources of income namely 800 Euros monthly pension
and 600 Euros per
month being rental he receives from his property.
[22]
Regulation 3(1)(b)
bis
provides:
Restriction
on
the export
of
currency,
gold,
securities,
etc, and
the import of
South African bank-notes
(1)
Subject to any exemption
which may be granted
by the Treasury or
a person authorised by the Treasury, no
person shall, without permission
granted by the
Treasury
or
a
person
authorised by the
Treasury
and in accordance
with
such
conditions
as
the
Treasury
or
such
authorised person may
impose-
(a)...
(b)...
(b)
bis take any South African bank-notes into the Republic or send or
consign any such notes to the Republic."
Regulation
3(6) provides:
(6)
Every person
who is about to enter the Republic
and every person in any port
or other place recognised
as
a
place
of arrival in the Republic,
who
is requested to
do so by the
appropriate officer
shall-
(a)
declare
whether
or
not
he
has
with him
any
South
African bank-notes;
and
(b)
produce any such bank-notes which
he
has
with
him;
and the appropriate officer and any
person acting under his directions may search such person and examine
or search any article
which such person has with him, for the purpose
of ascertaining whether he has with him any South African bank-notes
and may seize
any such bank-notes produced or found upon such
examination or search unless either-
(i)
the
appropriate
officer
is
satisfied
that
such
person
is,
in respect of any South
African
bank-notes which he has with him, exempt from the
prohibition
imposed by
sub
regulation
1
(b)bis;
or
(ii)
such person produces
to the appropriate
officer
a
certificate granted
by
the
Treasury
which
shows
that
the
importation
by
such person of any South African bank-notes
which
he has with him does not involve
a
contravention of
that
sub
regulation.
No
female shall be searched in pursuance of this sub regulation except
by a female.
(7)...
(8)
All South African bank-notes seized under sub regulation (6) or (7)
shall be forfeited for the benefit of the National Revenue
Fund:
Provided that the Treasury may, in its discretion, direct that any
notes so seized be refunded or returned, in whole or in
part, to the
person from whom they were taken, or who was entitled to have the
custody or possession
of
them at
the
time when
they were seized.
[23]
I now deal with points raised in argument on behalf of the applicant.
A:
The Applicant's rights in terms section 22 of the Constitution of the
Republic of South Africa Act. 1996.
Although
this point was not argued orally Mr Witz did not indicate if he had
abandoned it.
[24]
Section 22 provides that every citizen has the right to choose
his/her trade, occupation or profession freely. I fail to understand
how this constitutional right can assist the applicant. In my view it
is irrelevant for the determination of the merits of this
case. The
submission is therefore without substance.
B:
The Applicant's rights in terms section
25 of the Constitution
[25]
In
Armbruster's
case
supra
the applicants
challenged the constitutionality of regulation 3(5) on the basis that
it violated their rights as entrenched in section
25 of the
Constitution. Regulation 3(5) like regulation 3(8) is also a
forfeiture regulation. The High Court's finding (per Prinsloo
J) held
that the deprivation of property in question was pursuant to the Act
as a law of general application and was therefore
not arbitrary. This
was confirmed by the Constitutional Court. With regard to deprivation
I can put it no better than Mokgoro J
where she said:
·
The
purpose
of the law giving rise to the deprivation is to
prevent
violations of
currency exchange control
regulations, and the unlawful removal of foreign currency from South
Africa. It aims to deter not only
the person affected but also
others. The connection between the purpose of the deprivation, the
property and the person deprived
could hardly be closer. In all
probability, the person who is in unlawful possession of the
currency is the owner or carries
the property at the owner's behest.
Even though it is true that the owner could possibly be deprived of
all the currency in his
or her possession at an airport, there is in
this case sufficient reason for the deprivation. Ordinarily,
arbitrariness would be
out of the question."
[26]
On the facts of this case the applicant has not shown that the
deprivation was arbitrary more particularly because he gave
conflicting versions.
C:
Was the deprivation procedurally unfair;
[27]
At the Border post the applicant was given a standard letter
requiring him to make presentations and to consult with legal
advisers in this regard. He gave the documents to his lawyers and
thereafter a series of letters were written to the respondents
on his
behalf. This culminated in the letter of 17 January 2014 by Mr Deport
in which he stated that after considering the applicant's
representations a decision was taken not to return the money to him.
His lawyers did not write back and contest that he had not
been
afforded an opportunity to make representations. Instead review
proceedings were instituted. I therefore find that the submission
has
no merit and that the applicant was indeed afforded an opportunity to
present his case before a decision was taken.
D:
Did Mr Deport take into account irrelevant considerations and did he
ignore the relevant ones:
[28]
No facts were pleaded to demonstrate that Mr. Delport took into
account irrelevant considerations. Accordingly this contention
has no
basis. In his letter of 17 January 2014 Mr Deport set out his reasons
for the decision and stated that he took into accounts
his
representations. I am therefore not persuaded that Mr Delport took
into account irrelevant considerations.
Did
the respondents act arbitrarily?
[29]
Here again I could find no facts which were pleaded in support of the
contention. It is very unhelpful to the Court if a party
simply
regurgitate the grounds of review as set
out in the PAJA without substantiation.
In any
event by its very nature an act of forfeiture of ones money is harsh.
But once it is established, as in this case, that
the person has
contravened the regulations the question of arbitrariness does not
arise. The applicant admitted that he did not
declare the money; he
did not have a permit from the Treasury. He was refunded the money
which in law he was entitled to possess.
I therefore find that the
deprivation was not arbitrary.
[30]
In the result I make the following order: The application is
dismissed with costs.
TOKOTA
AJ
ACTING
JUDGE OF
THE
HIGH COURT
DATE
OF HEARING: 1 FEBRUARY 2016
DATE
OF JUDGMENT:
Applicant's
Legal Representatives:
M
Witz
Instructed
by Bove Attorneys.
Third
and Fourth respondents' Legal Representatives: N G D Maritz SC
E
Muller
Instructed
by Gildenhuys Malatjie Inc.