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[2016] ZAKZPHC 97
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Kontonminas v Duzi Retailer CC t/a Tops at Duzi Spar and Another (3488/16) [2016] ZAKZPHC 97 (31 October 2016)
IN THE HIGH
COURT OF SOUTH AFRICA
KWAZULU-NATAL
DIVISION, PIETERMARITZBURG
CASE NO:
3488/16
In the matter
between:
PETER CHRIS
KONTONMINAS
APPLICANT
and
DUZI RETAILER
CC
t/a TOPS AT DUZI
SPAR
FIRST RESPONDENT
KWAZULU-NTAL
LIQUOR AUTHORITY
SECOND RESPONDENT
ORDER
The application for leave
to appeal is dismissed with costs, such costs to include the costs of
senior counsel.
JUDGMENT ON
APPLICATION FOR LEAVE TO APPEAL
27/10/2016
SEEGOBIN J:
[1] This is
an application by the first respondent for leave to appeal against an
order made by me on 19 September 2016, the reasons
for which were
filed on 20 September 2016. The order seeks to interdict and
restrain the first respondent from illegally
conducting the business
of an off-consumption liquor store at Laager Centre, 78 Langalibele
Street, Pietermaritzburg, pending the
outcome of an appeal which the
applicant has lodged with the second respondent which is the
KwaZulu-Natal Liquor Authority in terms
of section 61 of the
KwaZulu-Natal Liquor Licencing Act 6 of 2010 (‘the new Act’).
[2] In the
event of such leave being granted, the first respondent requests that
the appeal should lie to the full bench of the
KwaZulu-Natal High
Court.
[3] The
grounds upon which the application is premised are set out in a
notice date 24 October 2016. These grounds are the
following:
“1.
The Honourable Mr
Justice Seegobin, respectfully, erred in that, procedurally, the
Applicant was not entitled to the relief sought
without:
1.1
The Applicant first exhausting the internal remedies
of the Second
Respondent; alternatively
1.2
Demonstrating exceptional circumstances.
2.
The Honourable Mr
Justice Seegobin, respectfully, erred in accepting:
2.1
The First Respondent was trading from another premises than that in
respect of which the
licence was originally issued without the
knowledge and consent of the Second Respondent;
2.2
The First Respondent was obliged to lodge an application in terms of
Section 75;
2.3
The Applicant has a right to the relief sought, the balance of
convenience favours the Applicant
and the Applicant is prejudiced, by
virtue of the fact that the Applicant trades within the same centre
when on the Applicant’s
own version the Applicant is trading
contrary to the provisions of Act 6 of 2010.
3.
The Honourable Mr
Justice Seegobin, respectfully, erred in awarding punitive costs
against the First Respondent by:
3.1
Finding the First Respondent intentionally deceived the Second
Respondent;
3.2
Finding First Respondent always intended to trade from an alternate
premises;
3.3
Finding that the Second Respondent’s chairperson instructed the
First Respondent to
rectify the position;
3.4
Finding that the First Respondent persisted in its conduct knowing it
was acting unlawfully;
3.5
Failing to have regard to the First Respondent’s voluntary
suspension of business
in order for the Second Respondent to conduct
investigations;
3.6
Failing to have regard to the fact that the Second Respondent, after
having concluded its
investigations, advised the First Respondent
that it could commence trading again.”
[4] At the
hearing of the application for leave to appeal on 27 October 2016,
the first respondent was now represented by Mr Rowan
SC together with
Mr Tucker while the applicant continued to be represented by Mr
Naidoo SC.
[5] Having
listened intently to the submissions advanced by Mr Rowan on the
grounds set out above, I am not persuaded, for the reasons
that
follow, that any appeal by the first respondent would have any
reasonable prospects of success or that there is some other
compelling reason why the appeal should be heard.
[6] There
were two fundamental difficulties facing the first respondent:
6.1
The
first
was that the
first respondent’s application for a liquor licence was lodged
with the KwaZulu-Natal Liquor Licencing Authority
on the 7 March 2014
in terms of s19 of the old Act in spite of the fact that the old Act
was repealed and ceased to exist with
effect from 26 February 2014.
The new Act came into effect on 28 February 2014. Since the
first respondent’s
application was lodged in March 2014, the
transitional provisions contained in s102 of the new Act did not
assist the first respondent
as the provision applied only to matters
which were already before the liquor authority on the date on which
the new Act came into
operation. Despite this and the fact that
the application was made in terms of the old Act, the second
respondent saw it
fit to grant the first respondent a licence in
terms of the new Act. How the second respondent did this is
incomprehensible.
The result is that the first respondent was
issued with a licence irregularly and not in terms of the prevailing
legislation at
the time.
6.2
The
second
was that
the premises from which the first respondent trades were different
from those in respect of which the licence was applied
for and
issued. This much was recognized by the second respondent when
it conducted an inspection of the premises in May
2016. This
is borne out by the order
[1]
made by Xolo AJ on 11 May 2016 when this matter came before him on
that date. This inspection flowed from an earlier order
[2]
which was taken by consent before Maphumulo AJ on 6 May 2016.
The operation of the first respondent’s business from
premises
other than those specified in its application constituted an
illegality which could not be condoned.
[7] In light
of the above and the factual situation which existed at the time the
present proceedings were instituted, I considered
that the applicant
had made out a strong case for the relief sought and therefore
granted the order which I did on 19 September
2016.
[8] Mr
Rowan’s argument regarding the failure on the part of the
applicant of first exhausting the internal remedies of the
second
respondent
alternatively
failing to demonstrate exceptional circumstances is, in my view,
without merit. The duty to exhaust internal remedies is
not
absolute. The point was made by the Constitutional Court (per
Mokgoro J) in
Koyabe v Minister for Home
Affairs
[3]
as follows:
“
The duty to exhaust internal remedies is
therefore a valuable and necessary requirement in our law.
However,
that requirement should not be rigidly imposed. Nor should it be used
by administrators to frustrate the efforts of an
aggrieved person or
to shield the administrative process from judicial scrutiny
.
PAJA recognises this need for flexibility, acknowledging in s 7(2)
(c)
that exceptional circumstances may require that a court condone
non-exhaustion of the internal process and proceed with judicial
review nonetheless. Under s 7(2) of PAJA, the requirement that an
individual exhaust internal remedies is therefore not absolute.”
[My emphasis]
[9] In the
present matter I consider that the applicant’s efforts to
engage the second respondent on the unlawful issuing
of the licence
and the fact that the first respondent was operating its business
from different premises, to have been futile.
The second
respondent initially dragged its feet as is evident from the plethora
of correspondence
[4]
which passed between the applicant’s attorneys and the second
respondent’s officials both prior to and after the licence
was
issued. The second respondent only entered the fray once the
present application was instituted but thereafter stepped
back and
began adopting an ambivalent attitude. In my view and in these
circumstances, the applicant’s pursuit of any
internal remedies
with the second respondent would have been futile.
[10] The
second main argument advanced by Mr Rowan is that I erred in making a
finding of
mala fides
on the part of the first respondent which resulted in a punitive
costs order against it. I disagree. I considered that
from the very outset of the proceedings, the first respondent
(through its professional consultants) had misled the second
respondent
into believing that it was going to conduct its business
from the premises specified in the application whereas it knew that
it
was not. There are other instances on the papers from which
it became evident that the first respondent’s consultants
were
less than frank with the second respondent regarding the involvement
of the DPO in the inspection of the premises. The
evidence
showed that the DPO was never involved and no report was furnished by
him. Ms Viljoen’s contradictory allegations
in this
regard were a cause for concern.
[11] It must
be borne in mind that the application before me was for an interdict
pending the finalization of the applicant’s
appeal. It
was not for a review of the second respondent’s decision.
On the established facts I was satisfied
that the applicant had made
out a proper case for the relief sought.
[12] In the
premises I do not consider that the first respondent has shown that
it has any reasonable prospects of success on appeal.
It
follows that its application for leave to appeal must fail.
ORDER
[13] The
order I make is the following:
The application for leave
to appeal is dismissed with costs, such costs to include the costs of
senior counsel.
_________________
Date of
Hearing
: 27
October 2016
Date of
Judgment
: 31
October 2016
Counsel for Applicant
:
V.
Naidoo SC
Instructed
by
: Carlos
Miranda Attorneys
Counsel for 1
st
Respondent :
P. Rowan SC assisted
by M. Tucker
Instructed
by
: K Swart
& Company
c/o Stowell & Company
[1]
Pages 234-235 of the papers.
[2]
Pages 205A-205B of the papers.
[3]
2010(4) SA 327 (CC).
[4]
Annexures ‘PC4’-‘PC18’ to
the founding affidavit, at pages 100-125 of the indexed papers.