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[2016] ZAGPPHC 531
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Taisoar Consulting and Projects (Pty) Ltd v Canyon Resources (Pty) Ltd and Others; Canyon Resources (Pty) Ltd and Others v Minister of Mineral Resources; In Re: Interlocutary Application (42484/2016; 28668/2016) [2016] ZAGPPHC 531 (24 June 2016)
IN
THE HIGH COURT OF SOUTH AFRICA
(GAUTENG
DIVISION, PRETORIA)
Reportable:
Yes
Of
interest to other judges: Yes
Revised.
24/6/16
Case
no. 42484/2016
IN
THE MATTER BETWEEN:
TAISOAR
CONSULTING AND PROJECTS (PTY)LTD FIRST
APPLICANT
and
CANYON
RESOURCES (PTY)
LTD FIRST
RESPONDENT
ANTOBIZ
(PTY)
LTD SECOND
RESPONDENT
MINISTER
OF MINERAL RESOURCES THIRD
RESPONDENT
DIRECTOR
-GENERAL,
DEPARTMENT
OF MINERAL RESOURCES FOURTH
RESPONDENT
And :
CASE
N0:28668\2016
CANYON
RESOURCES (PTY)
LTD FIRST
APPELLANT
ANTOBIZ
(PTY)
LTD SECOND
APPELLANT
MINISTER
OF MINERAL
RESOURCES THIRD
APPELLANT
DIRECTOR
-GENERAL,
DEPARTMENT
OF MINERAL RESOURCES FOURTH
APPELLANT
VERSUS
MINISTER
OF MINERAL
RESOURCES RESPONDENT
In
Re: INTERLOCUTARY APPLICATION
JUDGMENT
LEGODI
J
;
HEARD
ON: 7 June 2016
JUDGMENT
HANDED DOWN ON: 24 June 2016
[1.]
A court should be careful not to attribute to itself superior wisdom
in relation to matters entrusted to other branches of
government. A
court should thus give due weight to finding of fact and policy
decisions made by those
with
special expertise and experience in the field
.
The extent to which a court should give weight to these
considerations will depend upon the character of the decision itself
as well as the identity of the decision maker. A decision that
requires an equilibrium to be struck between a range of competing
interests or considerations and which
is
to be taken by a person or institution with specific expertise in
that area must be shown respect by the courts
.
Often a power will identify a goal to be achieved but, will not
dictate which route should be followed to achieve that goal. In
such
circumstances,
a
court should pay due respect to the route selected by the decision
maker
[1]
Unless exceptional
circumstances are found by a court to exist on application by the
affected person, PAJA, which has broad scope
and applies to a wide
range of administrative actions, requires that available internal
remedies be enhanced prior to judicial
review of an administrative
action.
[2]
[2]
This case is about the judicial review of a decision taken on 22
April 2016 by the Acting Director General of the Department
of
Mineral Resources in terms of which an application by Canyon
Resources (Pty) Ltd and Antobiz (Pty) Ltd for the renewal of mining
right was refused.
[3]
The application was brought as an interlocutory application to the
main application by Canyon and Antobiz under case number
28668\2016
in terms of which they are inter alia, asking for a declaratory order
that mining operating right granted previously,
expires or expired on
16 May 2016 and not 16 May 2015 and that the regional Manager of the
Department of Mineral Resources be directed
to execute an amendment
of Clause 3.1 of the mining right under which they have been
operating by substituting the words "Six
(6) years" therein
to read "Seven (7) years".
[4]
The present interlocutory application was brought on an urgent basis
to be heard together with an urgent application brought
by Tiasor
Consulting and Projects (Pty) Ltd in terms of which a relief is
sought as follows:
"1. Dispensing
with the rule to service and time periods and disposing of this
application
as
one of urgency in accordance with the
provisions of Rule 6(12) of the Uniform Rules of Court.
2.
Directing
that paragraph 2.3 of the provisional order under the above number be
suspended.
3.
Interdicting
the First respondents (Canyon Resources (Pty) Ltd from carrying out
coal mining and related activities on portion 10
and 11 of the farm
Schoongezicht 225 JR in the district of Delmas, Mpumalanga, pending
the finalization of the main application
under case number 28668\16.
4.
Interdicting
the First Respondent from carrying out coal mining and related
activities on portion 10 and 11 of the farm Schoongezicht
225 JR in
the district of Delmas, Mpumalanga pending the outcome of the First
Applicant's Phalaborwa Mining Right renewal application
with
reference number MP 30\51112121244MR.
5.
Directing the
Director General to accelerate the processing of the appeal
lodged by the Applicant against the acceptance of the first
Respondent Mining Right renewal application.
6.
Should the Director
General grant the appeal and decline to approve the First Respondents
Mining Right renewal application, an order
directing the Regional
Manager to accelerate the processing of the Applicants Prospecting
Right and Mining Permit applications?
6. That the First and
Second Respondents is ordered to pay the costs of this application,
on attorneys and own client scale.
7. Granting to the
applicant further and\or alternative relief."
[5]
I decided to deal with both applications as urgent. I decided to hear
first counsel in the interlocutory application, in terms
of which a
relief is sought as follows:
"1. That in terms
of Rule 6 (12) of the Uniform Rules of Court ("Rules") the
Court dispenses with the forms and services
provided for in the Rules
and disposes of the relief sought in this notice of motion on an
urgent basis;
2. That, in terms of
section 7(2) (c) of the Promotion of Administrative Justice Act,
2000, the first applicant is exempted from
its obligation to exhaust
its internal remedies under section 96(1) of the MPRDA.
3. That the decision
of the second respondent to refuse applicant's application for the
renewal of its mining right for coal in
respect of the property known
as
Portion 10 and 11 of the farm Schoongezicht 225 IR situated
in the district of Delmas, Mpumalanga be reviewed and set aside;
4. That the second
respondent is ordered to pay the costs of this application de bonis
propriis on attorney and client scale signed
on this the third day of
June 2016.
[6]
Just as a brief background, on 15 December 2008 what is referred to
as Phalanndwa mining right in favour of Umthombo Resources
(Pty)Ltd
(now Canyon Resources (Pty) Ltd, was granted by the Director of the
Department of Mineral Resources in respect Portion
10 and 11 of the
farm Schoongezicht 225 IR situated in the district of Delmas,
Mpumalanga. The dispute which is the subject of
the dispute in the
main application under case number 28668\2016 is whether the mining
right aforesaid expired on16 May 2015 or
16 May 2016, Canyon
contending that it expired only on 16 May 2016, whilst Taisoar
contends that it expired during May 2015 and
that the latter was
therefore entitled to apply for prospecting and mining rights which
applications were accepted by the regional
manager as contemplated in
section 16(2), 22(2) or 27(3) of the Mineral and Petroleum Resources
Development Act 28 of 2002 (the
Act). It is the correctness or
otherwise of the acceptance of the applications which forms part of
the dispute in the main application.
[7]
Coming back to the interlocutory application, internal remedies are
designed to provide immediate and cost effective relief,
giving the
executive the opportunity to utilize its own mechanism, rectifying
irregularity first if any before aggrieved parties
resort to
litigation. Although courts play a vital role in providing litigants
with access to justice, the importance of more readily
available and
cost effective internal remedies cannot be gainsaid.
[3]
First, approaching a court before the higher administrative body is
given the opportunity to exhaust its own existing mechanism
undermines the authority of the administrative process. It renders
the judicial process premature, effectively usurping the executive
role and function. The scope of administrative action extends over a
value range of circumstances, and the crafting of specialist
administrative procedures suited to the particular administrative
action in question enhances procedural fairness as enshrined
in our
Constitution. Courts have often emphasised that what constitutes a
"fair" procedure will depend on the nature
of the
administrative action and circumstances of the particular case. Thus,
the need to allow executive agencies to utilize their
own fair
procedures is crucial in administrative action.
[4]
[8]
Such 'own fair procedures,' in the administrative action, are founded
in section 96 of the Act and for its importance, is quoted
in its
entirety:
"96
Internal
appeal process and access to courts.
(1)
Any person
whose rights or legitimate expectations have been materially and
adversely affected or who is aggrieved by any administrative
decision
in terms of this Act may appeal in the prescribed manner to- (a) the
Director-General, if it is an administrative decision
by
a
Regional Manager or an officer; or (b) the Minister, if it is an
administrative decision by the Director-General or the designated
agency.
(2) An appeal in terms
of subsection (1) does not suspend the administrative decision,
unless it is suspended by the Director-General
or the Minister,
as
the case may be.
(3) No person may
apply to the court for the review of an administrative decision
contemplated in subsection (1) until that person
has exhausted his or
her remedies in terms of that subsection.
(4) Sections 6, 7 (1)
and 8 of the Promotion of Administrative Justice Act, 2000 (Act 3 of
2000), apply to any court proceedings
contemplated in this section.
[9]
The duty to exhaust internal remedies is therefore a valuable
necessary requirement in our law. However, that requirement should
not rigidly be 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 recognised this
need for flexibility, acknowledging in section 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 section 7 (2) of PAJA, the requirement that
an individual exhausts internal remedies is therefore not
absolute.
[5]
Section 7 (2) of
PAJA provides:
"(2) (a) Subject
to paragraph (c), no court or tribunal shall review an administrative
action in terms of this Act unless any
internal remedy provided for
in any other law has first been exhausted.
(b) Subject to
paragraph (c),
a
court or tribunal must, if it is not
satisfied that any internal remedy referred to in paragraph (a) has
been exhausted, direct
that the person concerned must first exhaust
such remedy before instituting proceedings in
a
court or
tribunal for judicial review in terms of this Act.
(c) A court or
tribunal may, in exceptional circumstances and on application by the
person concerned, exempt such person from the
obligation to exhaust
any internal 30 remedy if the court or tribunal deems it in the
interest of justice."
[10]
As I said, the interlocutory application by Canyon is a request to be
exempted from exhausting internal remedies in terms of
section 7 of
PAJA read with section 96 of the Act. For this, Canyon is required to
show not only the existence of exceptional circumstances,
but also
that it will be in the interest of justice to review the decision of
22 April 2016 by the Acting Director General. The
decision is stated
as follows:
"1. This is to
inform you that after careful consideration of your application to
mine Coal in respect of the abovementioned
property, the Acting
Director General: Department of Mineral resources, by virtue of
powers delegated to me in terms of Section
103 (1) of the Mineral and
Petroleum resources Development
Act 2002 (Act 28 of 2002)
as
amended have decided to refuse your application for
a
renewal
of
a
mining right in terms of section 24(3) (a) of the Act.
2. The reasons for the
refusal are
as
follows:
2.1 Failure to comply
with section 24(1) (b) of the Act read together with section 24 (3)
(a) in that the application for renewal
of
a
mining right
was
not submitted in
a
prescribed manner in that the
application
was
submitted after the expiry date of the mining
right.
2.2 failure to comply
with section 25(2)(c) of the Act in that the mining operations are
not carried out in accordance with the
mining work program.
2.3 Failure to meet
the requirements of regulation 46 of the Act, therefore the renewal
of the mining right should not be supported:
[11]
Internal administrative remedies may require specialised knowledge
which may be of a technical and or practical nature.
The same
holds true for fact -intensive cases where administrators have easier
access to relevant facts and information. Judicial
review
can only benefit from full record of an internal adjudication.
particularly in the light of the fact that reviewing courts
do not
ordinarily engage in fact - finding and hence
require
a fully developed factual record.
[6]
(My emphasis).
[12]
I cannot agree more with the statement above. Looking at the reason
for the refusal of the renewal, only the Minister in the
course of
considering the internal appeal will be better placed to deal with
the issues raised in the letter of refusal. He or
she will have an
easy access to information from the Director and documentation upon
which the decision of refusal for renewal
in the present case is
based. The difficulty in the present case is that the court is
required to take a decision to exempt Canyon
from appealing in terms
of section 96 of the Act and to review and set aside the decision
without sufficient information, for example,
no record of the
decision. To seek to review the decision at this stage, would amount
to usurping the Minister's powers and would
amount to haste taking of
a decision without sufficient information. Just on this ground alone,
the interlocutory is destined to
fail.
[13]
What constitutes exceptional circumstances for exemption to exhaust
internal remedies will depend on the facts of each case,
and the
nature of the administrative action at issue. Thus, where internal
remedy would not be effective or where its pursuit would
be futile, a
court may permit a litigant to approach the court directly. So too is
the
case
where an internal appellate tribunal has developed a rigid policy
which renders exhaustion futile.
[7]
[14]
I am unable to see how the internal remedies created in section 96
can be said not to be effective or how a pursuit thereof
can be
futile. As I said, the Minister would be better placed to deal with
the matter on internal appeal than this court on review.
How can an
exhaustion of internal remedies be futile when the lodging of the
internal appeal can actually expedite the process
at less cost?
[15]
Counsel for Canyon was asked to direct this court to the exceptional
circumstances articulated in its founding papers. I was
told the
circumstances are found in paragraph 12 which reads:
" 12. This matter
is extremely urgent for the following reasons-
12.1 As stated in the
Main Application, the First Applicant currently employs at least 166
people at the Phalanndwa mine either
as
employee's and\or
through contractors
12.2 The First
Applicant has expended more than R199 million in building this mine.
12.3 if this Refusal
Decision is not set aside, the applicant will suffer irreparable harm
as
the Phalanndwa mine will have to be closed and all
employees and contractors retrenched and\or laid off.
[16]
These issues were meant to deal with urgency, but insofar as they
were intended to also prove exceptional circumstances not
to resort
to the internal process, Iam unable to see in what context. The
Minister should be able to deal with all these issues
in considering
the merits of the internal appeal. There is therefore no merit not to
exhaust internal remedies contemplated in
section 96 of the Act.
[17]
In the alternative, counsel for Canyon contended that the operation
of the decision of 22 April 2016 must be suspended pending
internal
appeal process in terms of section 96. That suspension is also
regulated under section 96. At the risk of repetition,
in terms of
subsection (2) any appeal in terms of subsection (1) does not suspend
the operation of the administrative decision,
unless it is suspended
by the Director General or Minister as the case may be. So, until
this process is exhausted, it will be
pre-mature of this court to
entertain any relief for the suspension of the decision of 22 April
2016. It is up to the Canyon whether
it wishes the Director General
to consider its request for suspension of the decision. Therefore,
this issue can only be determined
by this court once a decision for
suspension has been taken and internal remedies exhausted.
[18]
I now turn to deal with the urgent application by Taisoar, the relief
of which is quoted in paragraph 4 of this judgment. Two
of the relief
in the Taisoar's notice of motion in my view, have failed by the
wayside.
[19]
Paragraph 2.3 of the provisional order, ought to be discharged. It
reads as follows:
"2.3 The state
respondents do not finally decide the application for the renewal of
the mining right ("Phalanndwa Mining
Right'') held by the first
applicant in respect of the Phalanndwa Mining Area".
This order was made by
Basson J on the 26 April 2016. The order was clearly made by mistake
because as on 26 April 2016 the Acting
Director had already taken a
decision on 22 April 2016 quoted in paragraph 10 of this judgment
refusing Canyon's application for
the renewal of the mining right.
This too was conceded by Counsel on behalf of Canyon. The horse had
already bolted when the order
was made on 26 April 2016. For this
reason, it ought to be discharged.
[20]
Prayer 5 of the notice of motion quoted in paragraph 4 above is for
an order directing the Director General to accelerate the
processing
of the appeal lodged by Taisoar against the acceptance of Canyon's
application for renewal of the mining right. This
too had fallen by
the wayside because the renewal application has been dealt with by
refusing to renew the application.
[21]
Regarding prayer 6, this court is reluctant to make such an order. It
should be left up to the Director General or State respondents
as to
when to consider the application by Taisoar for prospecting and
mining rights. It is also up to Taisoar to approach the state
respondents to expedite the application. Whether that is feasible
before finalisation of internal remedies available to the Canyon
and
Antobiz is not for this court to decide.
[22]
It is the interdict relief in prayers 2 and 3 of the notice of motion
which counsel for Taisoar strongly argued. The argument
was that the
interdict must be granted because Canyon has no valid mining right to
continue with its operation on the mine as such
right had expired in
May 2015. As I said earlier, this is the subject of a dispute in the
main application. The nature of the relief
sought pending the
finalization of the main application by Canyon, will in my view, have
final effect in that Canyon in the event
it was to be successful with
its application may find it difficult to recoup its loss.
[23]
The essence of Canyon's main application is that its mining right did
not expire in May 2015 but in May 2016 and that it applied
for the
renewal thereof in July 2015. Thus, it had the effect that the
provisions of section 25 (1) kicked in. In other words,
as a holder
of mining right and subject to section 24, Canyon has exclusive right
to apply for
and
be granted renewal of the mining right in respect of the mineral and
mining area in question.
[8]
[24]
The Minister is obliged to grant the renewal on mining right,
provided the applicant for such a renewal complied with subsections
(1) and (2) and if the holder of the mining right has also complied
with the requirements as envisaged in paragraph (a) to (d)
of
subsection (3).
[9]
I do not find
it necessary to deal with the details. It suffices to mention that a
properly lodged application for renewal of mining
right, confers
exclusive rights on the holder of a mining right to apply for renewal
and be granted such a renewal. So, the issue
to be ventilated in the
main application is whether such a right has been forfeited by virtue
of the fact that at time the application
for renewal was lodged,
canyon was no longer the holder of any such mining right as it
allegedly expired in May 2015, an issue
which is contested by Canyon.
[25]
For two reasons Canyon makes the contention, which is likely to turn
into a fierce debate during the hearing of the main application.
First, that the expiry of its mining right in May 2016 is confirmed
in the mining right agreement signed by all parties and clause
3.1
reads:
"3
.
1 The
right shall
commence
on 2rh May 2009 and, unless cancelled or
suspended in terms of this clause 13 of the right and or section 47
of the Act, will continue
to be enforce for the period of six (6)
years ending on 26 May 2016."
[26]
However, "2016" was changed to "2015" by hand
entry made by notary Mr Mangena who is a signatory to the
mining
right agreement signed on 27 May 2009 and also signed by the Minister
or on his behalf and the holder of the mining right.
[27]
In a document under letterhead of Canyon and referred to as "SOCIAL
AND LABOUR PLAN ACTIVITIES", and alleged to have
been signed by
all parties to the agreement, under paragraph 3.4.3.1 thereof dealing
with "Structure" the life of the
resource from start to
completion is indicated as '6 years at the given rate of depletion'.
The 'production timeline' is indicated
as 'year 2 to 7' and 'Total
coal production life of mine' production period is indicated as being
from 'year 1 to year 7' and 'removal
parting mined at 7 years'. Based
on all of the above, it was contended on behalf of Canyon that there
was a case to argue in the
main application. That in my view, appears
to be so and for this I am not persuaded to grant relief as sought in
prayers 3 and
4 of Taisoar pending finalization of the main
application.
[28]
I should not be understood as giving Canyon licence or right to
continue or not to continue with its mining activities. The
fact of
the matter is that it does not currently have a mining right in
force, such right having expired during May 2015 or 2016
and the
decision to renew the mining right having been refused on 22 April
2016.
[29]
Furthermore, it must be remembered that a mining right in respect of
which an application for renewal has been lodged shall
despite its
expiry date remain in force, until such time as such application is
granted or refused.
[10]
This
provision has fallen by the wayside as the application for renewal
has since been refused. Any person is guilty of an offence
if he or
she contravenes or fails to comply with section 5A.
[11]
[30]
No person may mine and produce any mineral without mining right.
[12]
Canyon and Antobiz should be cognisance of this, bearing in mind that
any authorised person without a warrant may enter any place
where
mining is being conducted in order to inspect any activity, process
or operation carried out in or upon the area or place
in question
[13]
and may require the holder of right, if any or any person carrying
out or in charge of the carrying out such activities, process
or
operations to produce any book, record, statement or other document
for inspection.
[14]
So, such
document to be produced for inspection should include a document
proving the existence of mining right for activities
performed
thereon.
[31]
If an authorised person during the inspection finds that a
contravention or suspected contravention or a failure to comply
with
any provisions of the Act has occurred or is occurring on the mining
area or place, other mining operations are being conducted
such a
person may order the person in charge of such area, any person
carrying
out of such activities or operations or the manager, official,
employee or agent of such holder or person, to take immediate
rectifying steps
[15]
or order
that mining, production or prospecting operations or part thereof be
suspended or terminated and give such other instructions
in
connection therewith as may be necessary.
[16]
[32]
It is therefore incumbent on the Minister, Director General and or
Regional Manager whether they bring to a stop the activities
of the
Canyon and Antobiz as envisaged in section 92 and 93 of the Act. They
would be better placed to know how to manage the repercussions
that
might be brought by any suspension or termination of the mining
activities of Canyon. Similarly, Taisoar should be at liberty
to
approach the state respondents to act in terms of the provisions of
section 92 and 93. Taisoar's application ought to fail.
[33]
Consequently an order is hereby made as follows:
[33.1]
Paragraph 2.3 of the interim order and quoted in paragraph 19 of this
judgment is hereby discharged.
[33.2]
Taisoar Consulting and Projects (Pty) Ltd's other reliefs sought in
its notice of motion are hereby dismissed.
[33.3]
Canyon Resources (Pty) Ltd and Antobiz (Pty) Ltd's interlocutory
application is hereby dismissed.
[33.4]
Each party to pay its own costs.
_____________________
JUDGE
OF THE HIGH COURT
MF
LEGODI
Instructed
for Applicant
: VAN DER MERWE VAN DEN BERG ATTORNEY
COUNCEL
FOR APPLICANT
: I E TSHOMA
Instructed
for 1
st
& 2
nd
Respondent
:STATE ATTORNEY
COUNCEL
FOR RESPONDENT
:LEON J BEKKER
Instructed
dir 4
th
Respondent
:B RIKHOTSO ATTORNEYS
COUNCEL
FOR 4TH RESPONDENT
: L BEKKER
[1]
Bato Star Fishing )Pty)Ltd V Minister of Environmental Affairs and
Tourism and others 2004(4) SA 327 (CC) para 48
[2]
See Koyabe and Others v Minister of Home Affairs and Others
2010 (4)
SA 327
CC at para 34.
[3]
See Kogabe supa at para 35.
[4]
Kogase supra at para 36
[5]
See Koyabe supra para 38
[6]
See Koyabe supra at para 37
[7]
See Kayobe supra at para 39
[8]
Subsection (1) of section 25
[9]
See subsection (3) of section 24
[10]
Subsection (5) of section 24
[11]
Section 98 (a) (i)
[12]
Section SA (b)
[13]
Section 92(a)
[14]
Section 92(b)
[15]
Section 93(1) (a) (i)
[16]
Section 93(1)(b) (ii)