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[2007] ZASCA 111
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Kebble and Others v Minister of Water Affairs and Forestry (530/06) [2007] ZASCA 111; [2007] SCA 111 (RSA) (21 September 2007)
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THE SUPREME COURT OF APPEAL
OF SOUTH AFRICA
CASE
NO:530
/06
Not reportable
In the
matter between
ROGER
AINSLEY RALPH KEBBLE
.......................
1
ST
APPELLANT
HENDRIK
CHRISTOFFEL BUITENDAG
.......................
2
ND
APPELLANT
GORDON
TREVLYN MILLER
.......................
3
RD
APPELLANT
and
THE
MINISTER OF WATER AFFAIRS AND FORESTRY
.......................
RESPONDENT
CORAM:
HARMS ADP, LEWIS, VAN HEERDEN, JAFTA JJA, KGOMO AJA
HEARD:
23 AUGUST 2007
DELIVERED
:
21 SEPTEMBER 2007
SUMMARY:
An order that
a person is in contempt of court, which carries with it criminal
sanctions, should be made only where the court order
allegedly
flouted is clear and capable of enforcement. Appeal upheld against an
order that former directors of a company that did
not comply with a
court order were in contempt of court.
Neutral
Citation: This judgment may be referred to as Kebble v Minister of
Water Affairs
[2007]
SCA 111 (RSA).
JUDGMENT
LEWIS JA
[1] The appellants, to whom I shall refer as ‘the directors’,
were until 17 June 2005, the directors of Stilfontein Gold
Mining
Company Limited (‘SGM’). This is an appeal against an
order that the directors were in contempt of court for failing
to
ensure compliance with an order of the Johannesburg High Court.
[2] The Regional Director of the Department of Water Affairs and
Forestry, Free State (‘the Department’), over a period
from April 2005, issued directives to a number of mining companies in
the Klerksdorp, Orkney, Stilfontein and Hartebeesfontein area
(the
KOSH area), including SGM, about the pumping of water from mine
shafts. When SGM failed to comply with the directives, the Department
applied to the Johannesburg High Court, on an urgent basis, for an
order compelling SGM to comply with the Department’s
directives.
Goldstein J issued an order on the terms requested on 18
May 2005.
[3] SGM, through its attorneys, indicated in a letter to the
Department dated 9 June 2005, that it could not comply with that
order.
The Department nonetheless brought another urgent application,
on 14 June 2005, this time for an order that SGM and its directors
be
held in contempt of court. Prior to the hearing of that application
the directors all resigned as such. Hussain J, in the Johannesburg
High Court, on 15 May 2006, convicted SGM and the directors, and
sentenced SGM to pay a fine of R15 000 and the directors to pay
fines
of R15 000 each, and failing payment to six months’
imprisonment each. It is against the order that they were in contempt
of court, and the sentences imposed, that the directors
1
appeal to this court, leave having been given by Schwartzman J in the
Johannesburg High Court.
[4] The directors raise some 11 grounds of appeal against the
judgment of Hussain J. I shall not deal with them all in view of the
finding which I make that the order of Goldstein J, requiring SGM to
comply with the directives, was incapable of implementation.
However,
a very brief history of the matter is necessary.
2
[5] The respondent mining companies in the first application owned
land in the KOSH area in the North West Province. SGM is on a
higher
level (upstream) than are the other mines in the area. In a letter
written by the department to SGM on 13 April 2005, and
in which the
first directive is contained, the position is explained as follows
(in summary). In order to prevent pollution of ground
and surface
water in the KOSH area, and to continue the safe operations of the
mines, underground water needs to be removed, collected
and treated
to an acceptable level for use, or discharged in an environmentally
acceptable fashion. This must be done at the most
beneficial place,
before the water becomes exposed to underground workings which may
affect its quality. A number of mines are affected,
including SGM,
DRD Gold Ltd, Anglo Gold Ashanti Limited and Harmony Gold Mining Co
Ltd.
[6] The KOSH Intermine Water Forum was established in April 2000 to
find a ‘negotiated solution’ to the problem of pumping
water from underground in the most effective manner. SGM was a member
of the forum. By April 2005 no solution had yet been agreed.
Hence
the Regional Director, Free State, acting under delegated authority
from the Minister of Water Affairs and Forestry, issued
directives to
the mining companies concerned under
s 19(3)
of the
National Water
Act 36 of 1998
.
[7] SGM, like the other companies, was ordered to:
1 ‘collect, remove and
contain water arising in the KOSH basin at the most appropriate
location, treat it to standards as may
be prescribed from time to
time, or use or discharge it in a legal manner’ . . . .
2 ‘ensure the continued
operation and maintenance of all infrastructure associated with any
aspect of the management of the
water found underground and, in this
respect, provide the Regional Director with a weekly report regarding
the status of such infrastructure,
as well as the provisions made to
ensure such continued operation and maintenance . . . starting 22
April 2005’.
3 ‘To, before 1 May 2005,
provide the Regional Director with the outcome of a determination of
your responsibilities with regard
to the continued collection,
removal, containment, treatment, use and disposal of the water found
underground in this area, based
on the following:
a Stilfontein Gold Mining Co
historic contribution to carrying responsibilities relating to the
cost for the collection, removal,
containment, treatment, use and
disposal of such waters; . . .
b the underground area exposed
by your operations;
c the surface area covered by
your operations;
d your collective earnings to
date resulting from your mining activities in the area;
e . . .
f . . .
which determination must be
submitted together with audited statements and documentation by
suitably qualified persons regarding these
aspects.’
4 ‘To, before 1 June 2005,
submit the outcome of an environmental legal compliance audit
conducted on your operations . . .
.
5 To, before 1 July 2005, based
on the outcome of the environmental legal compliance audit, and
following approval thereof by the
Regional Director, either --
a apply for the necessary
authorisations required under Chapter 4 of the NWA for all water uses
. . .; or
b provide satisfactory
documented proof to the Regional Director that such provisions are
not applicable to your operations.’
[8] There followed other directives and an account of the
consequences of non-compliance. The directive of 13 April was
followed
by another, dated 15 April, purportedly clarifying the prior
directive in regard to the management of water found underground, but
expressly not in substitution for it.
[9] The attorneys for SGM responded to the first directive on 14
April 2005, pointing out that SGM had closed its mine in 1992 and
that the pumping of underground water had since then been undertaken
by Hartebeesfontein Gold Mining Co Ltd. They advised further
that SGM
was not in a financial position to pump and extract underground water
from its mine shafts, and that it was accordingly
impossible for SGM
to comply with the directive or any court order that might follow.
They advised also that the shareholders and
directors of SGM were
considering an application for its winding-up.
[10] There followed another letter from the Regional Director, dated
7 May 2005, which again explained the importance of preventing
flooding of mine shafts in the area and the dire environmental
consequences if underground water were to be contaminated. A third
directive was thus issued in the letter, clarifying the requirements
relating to the extraction of underground water. The number
of litres
per day to be extracted from each shaft before 30 June 2005 was
specified. And, most controversially, the directive stated:
‘
For
the interim period, starting from the date of this directive until 30
June 2005, ensure that the cost for taking the measures
under clause
2(b) (sc 2(a)), including the cost for ensuring the continued
operation and maintenance of all infrastructure associated
with any
aspect of the management of this water found underground, is shared
equally between AngloGold Ashanti Limited, Harmony Gold
Mining
Company, Stilfontein Gold Mining Company and DRD Gold Limited.’
Again, the implications of non-compliance, including liability to
criminal charges under the Act, were set out in full.
[11] On 18 May the Department applied on an urgent basis for an order
that SGM and Harmony comply with the three directives. Harmony
had
paid a contribution to the costs referred to in the directive of 7
May under protest and applied for leave to appeal against
an order
(dated 22 April 2005) that it comply with the Regional Director’s
directives. Goldstein J, who heard the urgent application
against
SGM, had on the same day given Harmony leave to appeal against that
order to this court.
3
[12] At the hearing of the application against SGM an affidavit
(dated 13 May 2005) of one of the SGM directors, Mr G Miller, was
handed to the court. It had not been served on the Department. Miller
stated that SGM was no longer mining; that the one shaft that
was
still operative – Margaret Shaft – was being pumped by
Hartebeesfontein in accordance with an agreement; that any
income
from the sale of water obtained was used to defray expenses, and that
SGM was unable to contribute to the costs of pumping.
Miller stated
that if SGM were ordered to contribute to the pumping cost of the
KOSH region it would not be able to comply with the
order, and might
be liquidated.
[13] Goldstein J was not impressed with the affidavit handed up. It
did not ‘reveal what the assets and liabilities of Stilfontein
are, and in my view nothing said in this affidavit constitutes a
defence to the claims made . . .’. The learned judge was
willing
to order SGM to comply with the directives, and did so with
minor changes made to accommodate Harmony and the possible success of
its appeal to this court. In effect, the court ordered SGM to comply
with the three directives issued.
[14] On 9 June SGM’s attorneys wrote to the State Attorney (in
response to a letter from it demanding compliance with the court
order) explaining again SGM’s inability to comply with the
directives and thus the court order. But on 14 June 2005 the
department
brought yet another urgent application, this time against
SGM and the directors, for a finding that they were in contempt of
the
order made by Goldstein J on 18 May. On 17 June, before this
application was heard, the directors resigned their offices. The
directors
had not been parties to the application for compliance with
the directives, but were sued in this application as the persons able
to ensure compliance by SGM. Nothing, in my view, turns on their
resignation prior to the hearing of the application for an order
that
they were in contempt of court.
[15] The application came before Hussain J on 24 June: he postponed
the hearing to 25 and 26 July, and also ordered that the directives
be implemented in the interim. As I have said, Hussain J found,
almost a year later, that SGM and the directors were in contempt
of
court. I shall not deal with his reasoning. Nor, as I have said,
shall I consider all the grounds of appeal. It should be noted,
however, that the contempt alleged was said to have been committed
before 30 June 2005, the date given for compliance with the
directives
by the Department. This is not the least curious feature
of the matter.
[16] The basis upon which the directors argue that the application
should have failed is that the directives were incapable of
implementation
because they were so vague. This is illustrated by one
of the directors’ grounds of appeal: SGM was ordered, in the
third directive,
to contribute to the costs of pumping water from the
shafts in the KOSH area. The directors contend that an order of
contempt of
court cannot be granted where the judgment is one
sounding in money –
ad pecuniam solvendam.
Where money
is payable pursuant to a judgment, enforcement of the order is
achieved through a writ of execution. Contempt proceedings
are
therefore inappropriate. It is only where performance of an act is
ordered –
ad factum praestandum
– that conviction
for contempt of court is permitted as a means of enforcing
performance (as well, of course, as a means of
punishing those who
flout court orders).
[17] The Department contends, on the other hand, that the distinction
is not germane to the order granted. The relationship between
the
parties is not that of debtor and creditor: the Department is not the
judgment creditor. That is clearly so. But it is not necessary
even
to deal with the distinction. The principal difficulty with the
directive in relation to the contribution to the costs of pumping
water (with which the court ordered compliance) is that the amount is
not determined; the person to whom payment is to be made is
not
known; and the date by which payment is to be made is not determined.
How were the directors to avoid being in contempt of court,
and when
did their conduct amount to contempt, bearing in mind that SGM had
until 30 June 2005 to comply with the third directive?
Moreover, no
explanation was proffered as to why the application for an order that
they were in contempt was brought before performance
was due.
[18] The response of the Department is that the other mining
companies – respondents before Goldstein J – had not had
similar doubts: they had made contributions to the costs of pumping.
That does not tell us, however, that they were under an obligation
in
terms of a court order to make payment, nor to whom it should be
made. Counsel for the Department was unable to assist the court
in
this regard.
[19] Another directive that the directors complain is unintelligible,
and incapable of implementation, relates to the pumping of
water, and
the maintenance of infrastructure for the management of underground
water, in the entire KOSH basin, both of which are
largely beyond the
control of SGM. Similarly, the requirement that SGM provide the
Regional Director with ‘the outcome of a
determination’
on its responsibilities in relation to water treatment in the entire
KOSH basin is both unclear and similarly
largely beyond the control
of SGM.
[20] Moreover, the Department has failed to respond to the fact that
the company secretary to SGM, in an affidavit in the contempt
application, pointed out that SGM was no longer functioning, no
longer had any directors, and was unable to implement even those
parts of the directive that were clear. Mr Roger Kebble, one of the
directors, in his answering affidavit, contended that the directors
had been forced to resign because the directive was incapable of
implementation, and if a contribution to costs were to be made SGM’s
ability to pay other amounts required for the rehabilitation of the
environment would be jeopardized. All of this had been drawn
to the
attention of the Department previously. The court order requiring
compliance with the directives was thus not wholly ignored.
[21] In my view, the directors’ argument that the order, in the
form in which it was made, was so lacking in clarity that it
was
incapable of enforcement, is correct. SGM could not have known
precisely what steps it should have taken to comply. And the
directive
to contribute to the costs of pumping water was imprecise
in the respects discussed above. While the directors, before they
resigned,
undoubtedly should have been more assiduous in seeking
clarity – in particular in regard to SGM’s contribution
to the
costs of pumping – they did not simply flout the order.
They advised the Department, through their attorneys and the company
secretaries, that they could not comply.
[22] However, given my conclusion that the order was so unclear that
it could not be implemented, it is not necessary to determine
whether
the directors deliberately or recklessly flouted it. Nor is there any
purpose in labelling their conduct as reckless or contemptible:
irresponsible conduct – if that is what their resignations as
directors amount to – is not necessarily contemptible and
in
this case is not contemptuous.
[23] An order that a person is in contempt of court, which carries
with it criminal sanctions, should be made only where the court
order
allegedly flouted is clear and capable of enforcement. Where that is
not so a court cannot find that a party has deliberately
not complied
with the order. The order made by Goldstein J that SGM comply with
the directives of the Department was unclear because
the directives
themselves were unintelligible in several respects and to some extent
also incapable of implementation. There was
not, in the
circumstances, any wilful failure to comply with the court order. The
appeal must thus succeed.
[24] The appeal is upheld with costs, including those of two counsel.
The order of the court below is altered to read:
‘
The application is dismissed with costs.’
C H Lewis
Judge of Appeal
Concur:
Harms ADP
Van Heerden JA
Jafta JA
Kgomo AJA
1
One
of the directors, Mr Brett Kebble, died after having been found
guilty of contempt of court but before the appeal was noted.
2
The
background is discussed also in
Harmony
Gold Mining Co Ltd v Regional Director: Free State, Department of
Water Affairs and Forestry
[2006] SCA
65 (RSA).
3
The
appeal was dismissed:
Harmony Gold
above.