About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: North Gauteng High Court, Pretoria
SAFLII
>>
Databases
>>
South Africa: North Gauteng High Court, Pretoria
>>
2015
>>
[2015] ZAGPPHC 583
|
|
Snyders N.o as trustee of Louis Snyders Familie Trust v Louistef (Pty) Ltd and Others (56178/2014) [2015] ZAGPPHC 583; 2016 (1) SA 123 (GP) (17 July 2015)
IN THE HIGH COURT OF
SOUTH AFRICA
(GAUTENG DIVISION,
PRETORIA)
REPUBLIC OF SOUTH
AFRICA
CASE NUMBER: 56178/2014
DATE: 17 JULY 2015
In the matter between:
CWA SNYDERS N.O. as trustee of
LOUIS SNYDERS FAMILIE
TRUST
....................................................................................
Applicant
And
LOUISTEF (PTY)
LTD
...............................................................................................
First
Respondent
THE CONTROLLER OF PETROLEUM
PRODUCTS
......................................
Second
Respondent
MACROBERT
INCORPORATED
..........................................................................
Third
Respondent
JUDGMENT
JANSE VAN NIEUWENHUIZEN J
[1] The applicant
claims the following relief:
“1. An order
declaring that the agreement annexure "A” to the
Applicant’s Founding Affidavit is null and
void and of no force
and effect.
2. The First
Respondent pays the costs of the Application. ”
[2] The first
respondent opposes the relief claimed by the applicant and has
launched a counter application in terms of which the
following relief
is claimed:
”1. An order
declaring that the agreement, (annexures “A” and/or “RD”)
was legally and validly concluded
and was not null and void;
2. That the
applicant be ordered to pay First Respondent the amount of R 1 000
000, 00 plus vat of R 140 000-00 against delivery
of a valid tax
invoice.
3. In the
alternative to prayer 2 above:
3.1 that Applicant’s
repudiation of the agreement, First Respondent’s acceptance
thereof, First Respondent’s resiling
therefrom and its
termination, be confirmed;
3.2 That That (sic)
Applicant be ordered to pay the amount of R 1 000 000 - 00 (One
Million Rand) plus R 140 000, 00 to First Respondent
as liquidated
damages;”
[3] The second and
third respondents filed notices to abide by the decision of the
court.
FACTS
[4] The applicant is
the owner of a certain immovable property (“the premises”)
in Brits. The property has a filling
station (“the site”)
from which the first respondent has retailed petroleum products for a
period of approximately
13 years. For the aforesaid purpose the
parties have concluded consecutive lease agreements. In order to
conduct the business of
fuel retailing, the first respondent obtained
the necessary retail and site licenses prescribed by the Petroleum
Products Act,
120 of 1977 (“the Act”).
[5] According to the
parties, the lease agreement terminated at the end of April 2014.
[6] The applicant
was eager to continue with the filling station business and the third
respondent, the trust’s attorney at
the time, addressed a
letter to the first respondent requesting the first respondent to
transfer the site licence to the applicant
“in order to prevent
the site license from lapsing”.
[7] The first
respondent was, however, of the view that the site licence was its
asset and refused to relinquish or surrender the
licence.
[8] In view of the
first respondent’s attitude, the parties entered into a written
agreement in terms of which the applicant
purchased the site licence
from the first respondent for an amount of R 1 million.
[9] The Agreement
contains the following relevant clauses:
“3.
INTRODUCTION.
3.1 The Seller
conducts the business of a fueling station at the Premises.
3.2 The Seller
leases the Premises from the Purchaser and the lease agreement
terminates on 30 April 2014 and the Seller will cease
the business on
that date.
3.3 The Seller
wishes to transfer the Site License to the Purchaser in order to
enable the Purchaser to conduct a business of a
fueling station from
the premises. ”
and
“4. SALE OF
SITE LICENCE
The Seller hereby
sells the Site License to the Purchaser, who purchases same with
effect from the Effective Date. ”
[10] In pursuance of
the agreement, the applicant paid the purchase consideration of R 1
million into the bank account of the third
respondent. The first
respondent alleges that it complied with its obligations in terms of
the agreement by “signing all
documents and delivering those
documents, amongst others, Annexure “RE”, together with
the original site- and retail
licenses to the Applicant, who on the
strength thereof represented to Second Respondent that this was an
application for the transfer
of a licence. ”
[11] Annexure “RE"
refers to the retail licence and contains a declaration to surrender
the retail licence. The present
operator of the filling station has
applied for a corresponding retail licence in its name.
[12] It is common
cause that the second respondent has issued a site licence to the
applicant. It is, however, not clear from the
facts whether the site
licence would have been issued without the existence of the written
agreement.
[13] Prior to the
purchase price being paid to the first respondent, the applicant
received legal advice to the effect that the
written agreement is
null and void and unenforceable. As a result, the applicant
instructed the third respondent to withheld payment
of the purchase
price.
DISPUTE
[14] The applicant
alleges that the agreement is invalid; null and void and
unenforceable because a site licence is not a res capable
of being
sold.
[15] The first
respondent contents that the site licence forms part of its property,
has a value and is indeed capable of being
sold.
LEGAL PRINCIPLES
[16] In order for a
contract to be valid and binding, the contract must comply with
certain requirements. In Norman’s Law
of Purchase and Sale in
South Africa, RH Zulman, G Kairos, 5th edition, p. 2, the elements of
a contract of sale are stipulated
as follows:
“ (i) emptor
et venditor (buyer and seller - parties capable of entering into an
agreement of sale)
(ii) the merx or res
vendita (the thing or things which form the subject matter of the
agreement of sale)(see for example Kriel
and Another
[2000] 2 All SA
65
(SCA));
(Hi) the pretium
(the price in money or which is readily ascertainable in terms of
money). See the useful discussion by Lubbe in
2000 Annual servey pp.
213-221;
(iv) consensus ad
idem (the mutual consent of the contracting parties).”
[17] In view of the
dispute between the parties, it is only the second requisite, to wit
the merx or res vendita that requires further
attention.
Merx or res vindita
[18] In Norman’s
Law of Purchase and Sale in South Africa, supra at p.21, a merx or
res vindita is described as follows:
“3.1 the
second requisite of the contract of sale is a thing which can be
bought or sold, and which may form the subject matter
of the
contract. Paul pig 18.1.34.1) says:
“Whatever can
be held as private property, or possessed, or sued for, may lawfully
be sold; but things which are withdrawn
form commerce, by the law of
nature, or of nations, or by public policy, are incapable of being
owned by any individual person,
such as the air, public streams or
the sea, cannot be bought or sold. ”
[19] Things falling
in the first category are referred to as res in commercio and things
falling in the latter category as res extra
commercio.
[20] In order to
determine in which category a site licence falls, the legislative
framework pertaining to the licence needs to
be considered.
PETROLEUM PRODUCTS
ACT, 120 OF 1977
[21] Prior to the
commencement of the Petroleum Products Amendment Act, 58 of 2003
(“the Amendment Act”) on 17 May 2006,
the retail of
petroleum products in South Africa was largely unregulated.
[22] The 2003
Amendment Act changed the landscape of the petroleum retail industry
in South Africa drastically. The industry has,
subsequent to the
amendment, become highly regulated in the manufacturing, wholesaling
and retailing of petroleum products prescribed
by the Act.
[23] Section 2A(1)
of the Act, stipulates, inter alia, that a person must have a site
licence to hold or develop a site and must
have a retail licence to
retail prescribed petroleum products.
[21] Section 2A(4)
specifies the type of person who may apply for a licence. In respect
of a site licence, only the owner of the
property may apply.
[24] Section 2B of
the Act makes provision for the issuing of licenses and subsection
(3) deals with the duration of the validity
of a licence. The
subsection reads as follows:
(3) Any license
issued by the Controller of Petroleum Products remains
valid for as long
as-
(a) the licensee
complies with the conditions of the license;
(b) The licensed
activity remains a going concern, excluding a site; and
(c) in the case of a
site, there is a corresponding valid retail license. ”
(Own emphasis)
[25] Due to the fact
that fuel retailing businesses were in existence at the commencement
of the Act, the Legislator made provision
for transitional licenses
in section 2D of the Act. The section reads as follows:
“2D
Transitional licensing provisions.-(l) For the purposes of this
section -
‘hold’
means to own or lease land, or to possess an option to purchase land
or lease land, that has been zoned and approved
by appropriate
authorities for use as a site; and
‘process of
developing’....
(2) Any person who,
at the time of the commencement of the Petroleum Products Amendment
Act, 2003-
(a) holds and is in
the process of developing a site; or
(b) manufactures or
wholesale petroleum products, or retail prescribed petroleum products
shall, subject to
subsection (3), be deemed to be the holder of a license for that
activity.
(3) (a) Any person
referred to in subsection (2) shall, within a period of
six months from the
date of commencement of this section, apply for a manufacturing,
wholesale, site or retail license, as the case
may be.
(b) Subsection (2)
shall cease to apply if the person fails to apply for A license
within the period contemplated in paragraph (a).
(4) (a) An applicant
contemplated in subsection (3) shall, on application,
be entitled to be
issued with a license for the operation of the
activity concerned
if the applicant is in compliance with all
national, provincial
and local government legal requirement, that
are in force
immediately prior to the commencement of this Act for the operation
of the activity concerned.
(b) Such applicant
shall be subject to the general conditions of a license
set out in this Act,
but not to any financial security requirement prescribed by
regulation. ”
[26] The Act and
regulations promulgated in terms of the Act, differentiate between
sites established after the commencement of
the Amendment Act (“new
sites”) and sites that existed prior to the commencement of the
Amendment Act (“existing
sites”). Although only the owner
of land may hold a site licence in terms of section 2A (4) of the
Act, the transitional
arrangements contained in section 2D provides
that, subject to compliance with the relevant statutory requirements
contained in
section 2D, a lessee of land may also hold a site
licence. The requirements contained in the regulations for the
transfer of a
“new site” licence and the transfer of an
“existing site” licence also differ.
[27] Regulations to
the Act were promulgate by the Minister of Minerals and Energy in
Government Gazette, No 28665 on 27 March 2006
[Government Notice, No
R 286]
[28] Regulation 12
applies to the transfer of a site license. Regulation 12(1) applies
to the transfer of “new site”
licenses and regulation
12(2) and (3) to the transfer of “existing site”
licenses.
[29] Subregulations
(2) and (3) reads as follows:
“(2) In the
case of a licence issued to a person in respect of whom section 2D of
the Act is applicable, the site license
issued to-
(a) a land owner,
must be transferred to the new owner of that land; or
(b) a lessee, must
be transferred to the new lessee or to the new owner of that land.
(c) the provision of
a certified copy of the title deed or of the deed or of deed transfer
or of the lease agreement, to the Controller.
(Own emphasis)
[30] Subregulation
(4) applies to both new and existing site licenses and provides that
the application for the transfer of a licence
must be made within six
months of taking ownership or possession of the site.
APPLICANT’S
CONTENTIONS
[31] In view of the
provisions of regulation 12, the applicant contends that the first
respondent was obliged to transfer the site
licence to the applicant.
The applicant further contends, that the site licence is attached to
the site and the first respondent’s
entitlement thereto seized
when it vacated the site.
[32] In the
premises, the site licence has no commercial value and is not a merx
or res vendita for the purpose of a valid sale
agreement.
FIRST RESPONDENT’S
CONTENTIONS Ownership of rights flowing from site license
[33] The first
respondent avers that the rights flowing from the site licence
belonged to it and was its property.
[34] Regulation 38
deals with the ownership of a licence and reads as follows:
“38. Any
licence issued in terms of these Regulations-
(a) Remains the
property of the Department of Minerals and Energy;
(b) may be cancelled
or suspended at any time subject to Regulation 29;
(c) May not be
tempered with or defaced in any manner; and
(d) May not be
altered in any manner. ”
[35] The site
licence therefore remains the physical property of the Department of
Minerals and Energy (“ the Department”).
Although the
Department is the owner of the physical licence, the question arises
whether the first respondent “owned”
any rights flowing
from the licence.
[36] If regard is
had to regulation 12 (2), such licence must be transferred to a new
owner or new lessee, when ownership or possession
of the site
terminates. The licence is therefore a statutory requirement granted
to the owner or lessee of a site in order to enable
the person /
entity to retail petroleum products from the site.
[37] If one have
regard to the statutory framework regulating the granting of a site
licence, the status of a site licence can be
equated to that of a
liquor licence. In Aquatur (Pty) Ltd v Sacks and Others
1989 (1) SA
56
AD, Vivier JA at 64 H-l, described the status of a liquor licence
as follows:
“A liquor
licence, it has been stated in decisions in this Court, is a purely
personal statutory privilege granted to a particular
person under the
liquor laws to sell liquor at particular premises. Its grant involves
the exercise by the licensing authorities
of a delectus personae so
that the licensee cannot transfer or otherwise deal with the licence
unless authorised thereto in terms
of the Act, which provides for the
strict supervision of the grant, transfer and removal of licences. ”
[38] In the
premises, the first respondent did not possess any rights flowing
from the site licence that was capable of being sold.
The act does
not authorise the selling of the site licence, but provides that the
site licence must be transferred to the new owner
or possessor of the
site, once possession of the site is relinquished.
Commercial value of
site licence
[39] Apart from
contending that it was the owner of the rights flowing from the site
licence, the first respondent avers that the
licence has, in any
event, commercial value attached to it. According to the first
respondent, the commercial value emanates from
the fact that the site
licence would have terminated when it vacated the premises. In this
regard the first respondent relies on
regulation 30, which reads as
follows:
“30. (1) A
licence ceases to be valid if-
(a) the licence is
surrendered to the Controller;
(b) the licence is
cancelled by the Controller in accordance with regulation 29(2); or
(c) the licensed
activity is no longer a going concern. ”
[40] The first
respondent contends that the fact that the site licence would have
terminated, would have entailed that the applicant
had to apply for a
licence de novo.
[41] This would have
been a cumbersome and costly exercise. According to the first
respondent, the applicant would have had to:
“9.2.2 submit
an environmental management plan and provide proof of financial
position for the purposes of rehabilitation
as envisaged by
regulation 14(b)(i) and (ii)”
9.2.3 obtain a
Record of Decision (“ROD”) from the relevant authority on
the basis of an environmental impact study
in accordance with the
Environmental conversation Act, No 73 of 1989 as envisaged by
regulation 13(1)(d)(ii);
9.2.4 prove to
Second Respondent that proper notice was given in terms of regulation
4 of the Regulations.
9.2.5 prove that a
corresponding valid retail application has been lodged for that site
in terms of regulation 5 of the Regulations
and in case of an
application where a site licence made by a person in respect of
section 2D of the Act is not applicable, that
there is a need for the
site and that the site will promote the licencing objectives
stipulated for in section (B)
(2) of the Act;”
[42] In “selling”
the site licence to the first respondent, the licensed activity
(retailing of petroleum products),
however, remained a going concern
and the applicant did not have to apply for a licence de novo.
[43] Regulation 30
should, however, be read in conjunction with regulation 12 which
provides for the transfer of a site licence
in circumstances where
the owner or possessor of the licence seizes to occupy the site.
[44] The two
scenarios are distinct. If a licensed activity seizes all together,
it follows that the site licence will no longer
be valid. If a new
owner or lessee, however, takes over the site, the licence must be
transferred in terms of the provisions of
regulation 12.
[45] The aforesaid
conclusion corresponds with the contents of section 2B (3) of the
Act, that only requires a corresponding retail
licence in order for a
site licence to be valid. As stated, supra, it is common cause
between the parties that an application for
a corresponding site
licence has been lodged in respect of the site.
[46] In the present
circumstances, the mere fact that the first respondent seized
retailing operations when it vacated the site,
does not mean that the
site licence terminated and has as a result a corresponding
commercial value.
Regulation 12(2) not
applicable to applicant
[47] According to
the first respondent, regulation 12(2) does not apply in the present
circumstances, because the applicant is an
existing and not a new
owner.
[48] I pause to
mention that the Controller of Petroleum Products deemed the transfer
of the site licence to be in accordance with
regulation 12(2)and (3).
In a letter dated 14 May 2014, addressed to Mr Snyders, the trustee
of the applicant, the Controller remarked
as follows:
“The Office of
the Petroleum Controller acknowledges your request for Site Licence
Transfer (S/2008/1777), from LOUISTEF (PTY)
LTD to LOUS (sic) SNYDERS
FAMILIE TRUST
In accordance with
regulation 12 of the Site and Retail Licence Regulations, please make
a payment of R 500, 00 ”
[49] Payment of the
R 500, 00 presumably represents the site licence fee referred to in
regulation 12(3)(b).
[50] Insofar as
regulation 12(2) does not refer to an existing owner, a casus omissus
exist.
[51] When
legislation contains a casus omissus, a court must decide whether it
should “fill the gap” or whether “filling
the gap”
would amount to exceeding its powers in terms of the interpretation
of the separation of powers doctrine. [See,
inter alia:
Sleutelfontein (Edms) Bpk v Eerste Nasionale Bank van Suider-Afrika
Bpk
[1994] ZASCA 23
;
1994 (3) SA 407
(A)]
[52] When it is
possible to cure the casus omissus by interpreting the Act to give it
a meaning which is in accordance with the
rest of the Act, a court
should not hesitate to do so.
[53] In Vryenhoek
and Others v Powell NO and Others
1995 (2) SA 813
, the court
discussed the interpretation rule applicable to a casus omissus at
847 A-B:
“Devenish fop
cit at 84) under the heading ‘Interpretation by implication’
points out that provisions which are
‘not enacted in express
words may, under certain circumstances, be deemed to be implied by
means of the process of curial
interpretation. ’ The
implication must, of course, from other parts of the statute (Steyn
(op cit at 49) and must be ‘a
reasonable and necessary one. ”
[54] In
distinguishing between “new site” licenses and “existing
site” licenses, the legislator created
two distinct scenarios
to which different criteria apply. “New sites” have more
cumbersome requirements than “existing
sites”.
[55] No reason
appears from the Act and regulations to distinguish between a new
owner and an existing owner of an “existing
site”. Having
regard to the structure of the Act and the regulations, it follows
logically that the owner of an existing
site should by implication
fall within the provisions of regulation 12(2) and (3). The fact that
an existing owner of an “existing
site” is not expressly
referred to in regulation 12, renders this interpretation reasonable
and necessary.
[56] In view of the
aforesaid interpretation, the first respondent had a statutory
obligation to transfer the site licence to the
applicant.
CONCLUSION
[57] In the
premises, I am of the view that a site licence does not have
commercial value and is not a merx or res vendita. Consequently,
the
sale agreement between the parties does not comply with the essential
elements of a valid sale agreement and is null and void.
ORDER
I grant the
following order:
1. The sale
agreement between the applicant and the first respondent in respect
of the site licence for Erf 2835, Brits JQ, North
West Province, is
declared to be null and void.
2. The first
respondent is ordered to pay the costs of the application.
3. The counter
application is dismissed with costs.
JANSE VAN
NIEUWENHUIZEN
JUDGE OF THE HIGH
COURT OF SOUTH AFRICA
GAUTENG DIVISION,
PRETORIA
Counsel for
Applicant: Advocate B G Savvas ATTORNEYS
FOR THE
APPLICANT: VENN & MULLER ATTORNEYS
Counsel for the
First Respondent: Advocate JH Dreyer SC ATTORNEYS
FOR THE FIRST
RESPONDENT: LANGENHOVEN PISTORIUS & PARTNERS