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[2006] ZASCA 154
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Fuel Retailers Association of SA (Pty) Ltd v Director General, Environmental Management Mpumalanga and Others (530/05) [2006] ZASCA 154; 2007 (2) SA 163 (SCA); 2007 (10) BCLR 1127 (SCA) (22 September 2006)
THE
SUPREME COURT OF APPEAL
OF
SOUTH AFRICA
CASE NO: 530/05
Reportable
In the matter between
FUEL RETAILERS ASSOCIATION OF SA (PTY) LTD
Appellant
and
DIRECTOR GENERAL ENVIRONMENTAL MANAGEMENT,
MPUMALANGA AND 13 OTHERS
Respondents
Coram
: HARMS, CONRADIE, LEWIS, MAYA JJA, CACHALIA AJA
Heard:
21 AUGUST 2006
Delivered: 22 SEPTEMBER 2006
Summary Decision of the MEC, Department of
Agriculture, Conservation and Environmental Management, Mpumalanga
to allow the construction
of a filling station and the installation
of fuel storage tanks on a site in White River not set aside on
review: accepting the local
authority’s decision as to
rezoning, based on need and desirability, and making the development
subject to obtaining permits
and authority where necessary from the
Department of Water Affairs, does not vitiate the decision.
Neutral citation: This case may be cited as Fuel Retailers
Association v DG, Environmental Management, Mpumalanga [2006] SCA 109
RSA
JUDGMENT
LEWIS JA
[1] The appellant in this matter, Fuel Retailers Association of South
Africa (Pty) Ltd (Fuel Retailers), is a company which represents
the
interests of filling station proprietors across South Africa. It is
represented in this litigation by Mr Tom Hugo Le Roux, the
owner of
two filling stations, and with an interest in a third still to be
constructed, in the town of White River, Mpumalanga. Fuel
Retailers
applied in the court below (the Pretoria High Court) for the setting
aside of a decision made by the second respondent,
the Member of the
Executive Committee of the Department of Agriculture, Conservation
and Environment, Mpumalanga (the MEC), and upheld
on appeal by the
first respondent, the Director General, Environmental Management,
Mpumalanga, (the DG). The decision in question
was to permit the
construction of a filling station in White River. The application to
set aside the decision was brought in terms
of the common law, the
Environment Conservation Act 73 of 1989 (the ECA), and,
alternatively, the Promotion of Administrative Justice
Act 3 of 2000
(PAJA).
[2] The relief sought was opposed not only by the DG and the MEC, but
by the thirteenth respondent, Lowveld Motors (Pty) Ltd (Lowveld
Motors), represented by Mr George Dolezal. The company acquired the
rights to the land on which the filling station in issue is to
be
built from the ninth to the twelfth respondents, trustees of the
Imama Family Trust (Imama). The trustees and the other respondents,
local and provincial authorities, do not feature in the litigation.
[3] Webster J in the court below refused the application for the
setting aside of the decision of the MEC. The appeal against the
court’s decision lies with its leave. Although the record of
decision attacked by Fuel Retailers is signed by the Director
of
Environmental Management in the Department of the MEC, and the
decision was in effect made by Mr David Hlatshwayo, the Deputy
Director of the Department (who deposed to the answering affidavit on
behalf of the MEC), I shall for the sake of convenience refer
to the
decision-maker as the MEC.
[4] The background to the application for the setting aside of the
decision is briefly as follows. Imama applied to the MEC for the
establishment of a filling station in Kingsview, White River, on the
main road to Hazyview. The application was made on its behalf
by a
firm of environmental management services, Globecon, which prepared a
‘scoping report’ in compliance with Regulations
1182 and
1183
1
published in terms of the ECA. The construction of facilities for the
storage of fuel is a listed activity (one which may have a
substantial detrimental effect on the environment) under the
Regulations published under s 21 of the ECA. Authority must thus be
obtained in terms of the regulations for the construction of fuel
storage tanks and applications for authorization must conform with
the requirements of the Regulations.
[5] The record of decision, made in terms of s 22 of the ECA, was
signed on 9 January 2002. It granted authority for the installation
of three underground fuel tanks with a capacity of 21 500 litres each
for leaded and unleaded petrol and diesel respectively; the
erection
of a convenience store, a four-post canopy, ablution facilities and
driveways on to the premises. The record of decision
states that the
following were ‘key factors’ (presumably in deciding to
grant the application):
‘1 The property has been rezoned from “special” to
“business“.
No potential threatened plant and animal species were recorded
during the site investigation.
All identified and perceived impacts were satisfactorily dealt with
in the Scoping Report and the Addendum to the Scoping Report.
The
department is satisfied that the recommendations proposed are
sufficient to minimize any negative impacts.’
[6] The decision was also made subject to a number of conditions, set
out in an annexure. These included a prohibition on development
without obtaining the necessary permits or approvals of the
Department of Water Affairs and Forestry (DWAF) and the White River
Local
Authority. The annexure further states ‘This Department
may change or amend any of the conditions in this authorization if,
in the opinion of the Department, it is environmentally justified.’
I shall revert to these ‘conditions’ since
they form the
basis for part of the attack on the decision by Fuel Retailers.
[7] The application and decision-making process is described by
Hlatshwayo in a document giving reasons for the decision. He is in
charge of the department that deals with applications in respect of
listed activities and is himself educated and experienced in
environmental management. The application prepared by Globecon
complied, he said, with all the requirements of the Regulations and
the ECA. After an initial consideration of a plan of study prepared
by Globecon, Hlatshwayo, in August 2000, asked for further
information
from Globecon, and requested that a public meeting be
held to ensure proper consultation with all parties who might be
affected by
the decision. On 20 September 2000 another environmental
management firm, Ecotechnik, registered as an interested and affected
party.
On the same day Globecon filed its full scoping report.
[8] Attached to the scoping report was a report on the geotechnical
and geohydrological investigations done by the firm Geo 3 in
respect
of the site. Hlatshwayo then referred the scoping report for comment
to the DWAF. The reason for the referral was that there
is a borehole
on, and an aquifer running beneath, the property and the expertise of
officials in the DWAF was needed to assess Geo
3’s report.
[9] In October 2000 Ecotechnik objected to the construction of the
filling station inter alia on the bases that no noise or visual
impact assessment had been done and that the quality of the water
pumped from the borehole and running through the aquifer might
be
adversely affected by the existence of the filling station and
possible leakage from the fuel tanks. The objection was referred
to
the DWAF for comment. The objection was followed by an evaluation by
Ecotechnik of Globecon’s scoping report. It was not
based on
any investigation of its own.
[10] Hlatshwayo stated that he was ‘convinced that proper
surveys were done and that the results of Messrs Geo 3 were well
founded and scientifically based’. The applicants, he said
‘were realistic in their proposals, accepted that there will
be
an impact on the environment but I was convinced that scientifically
the impact when weighed with the economic development, social
acceptability, visual impact and in general from an environmental
science perspective far outweighs the impact on the environment.
I
was convinced that the impact on the environment will not be that
significant . . . .’ The applicants, he added, had convinced
him that mitigatory steps were being taken to ensure that the
environment was not adversely affected. Moreover, Globecon had
responded
to the evaluation made by Ecotechnik and had satisfactorily
addressed their objections.
[11] The DWAF responded to the scoping report in May 2001, accepting
the report of Geo 3, and stating that the developer must ensure
that
there was no pollution of groundwater, and that there must be
monitoring as proposed in the report and in accordance with
regulations.
Subsequently a public meeting was held (in December
2001): the meeting was attended by an employee of Ecotechnick who
raised no queries
and made no objections. Further information was
supplied as to the noise impact. Hlatshwayo was then satisfied that
all objections
had been met and accordingly recommended the grant of
the authorization. Nonenetheless, because of concern about the
aquifer, he
made the development subject to the taking of mitigating
measures and obtaining of permits where necessary.
[12] An appeal against the issuing of the record of decision was made
by Ecotechnick to Dr Garth Batchelor, the Director of the Department
authorized to deal with appeals in terms of the ECA and Regulations.
The appeal documentation consisted of a letter coupled with
a report
from consulting geologists, De Villiers Cronje Consulting Engineering
Geologists. This report was based on that of Geo 3,
and was not the
result of any independent tests done. Batchelor considered the report
of De Villiers Cronje to be incorrect in a
number of respects.
Nothing turns on this. He was satisfied that the appeal was without
merit and rejected it.
[13] The MEC, the DG and Lowveld Motors argue that Fuel Retailers’
opposition to the application for the development of a filling
station is plainly motivated by the wish to stifle competition but is
thinly disguised as a desire to protect the environment. The
interests of Tom le Roux Hugo in other filling stations in the area
(which were not disclosed in the founding affidavit) bear out
the
suggestion. As will be seen from a discussion of the objections,
there appears to be some merit in the contention. Fuel Retailers,
in
the application to the high court to set aside the decision of the
MEC, raised 11 grounds of review all purportedly relating to
environmental issues. It is not clear from the heads of argument of
Fuel Retailers’ counsel, nor from the application itself,
where
it relies on the common law, on the ECA, or on PAJA. These grounds
overlap to some extent. I shall deal with them, where necessary,
discretely.
Failure to take into account ‘socio-economic considerations
’
[14] The MEC failed, it is alleged, to consider the need and
desirability for a filling station on the site, together with its
sustainability.
These factors were referred to by Fuel Retailers as
‘socio-economic considerations’. The MEC and the DG
accept that
such factors must be taken into account when considering
an application for authority to carry on a listed activity. Lowveld
Motors,
on the other hand, argues that these are not factors relevant
to a decision by an environmental authority. However, it is clear
from
a number of decisions that socio-economic considerations must be
taken into account in making decisions under s 22: indeed ss 2,
3 and
4 of the National Environmental Management Act 107 of 1998 (NEMA)
require development to be socially, environmentally and economically
sustainable. See in this regard
MEC, Agriculture, Conservation and
Environment and Land Affairs, Gauteng v Sasol Oil (Pty) Ltd
,
2
BP SA (Pty) Ltd v MEC, Agriculture, Conservation and Environment and
Land Affairs, Gauteng,
3
Capital Park Motors CC and Fuel Retailers Association of SA (Pty) Ltd
v Shell SA Marketing (Pty) Ltd
4
and
Turnstone Trading CC v The Director General Environmental
Management, Department of Agriculture, Conservation and Environment,
Mpumalanga
.
5
[15] However, as pointed out by the MEC, whose views are supported in
a supporting affidavit by a town planner, Ms Irma Muller, the
questions of need, desirability and sustainability were considered
when the application for the rezoning of the site was made. The
practice in Mpumalanga, which is consistent with the relevant Town
Planning Ordinance, is to examine these factors at the stage when
rezoning is under consideration. Indeed there has to be a report on
need and desirability before property is rezoned. Hlatshwayo,
in
dealing with the decision of the local authority to rezone the site,
said that he had applied his mind to whether need and desirability
had been addressed by the local authority. He had ‘no reason to
doubt’ the integrity of the applicant nor of the members
of the
local authority. That, counters Fuel Retailers, is not enough. The
rezoning had taken place eight years before the application
to the
MEC was made for environmental approval.
[16] Muller, who has expertise in the zoning of property for the
construction of filling stations, confirmed that questions of need
and desirability would have been considered by the local authority
when permitting the rezoning. Subsequent developments in the area
would have been permitted taking into account the existing rezoning
of the site in question. One of the filling stations in which
Le Roux
has an interest was constructed after the application in question had
been approved. Thus, states Muller, Fuel Retailers
‘created
their own dilemma’: they ‘convinced the Local Council
that despite the relevant property [the site at
issue] a need and
desirability for their own development exist’. The same point
was made by the DG in his answering affidavit.
[17] It is not clear to me what additional factors should be
considered by the environmental authorities in assessing need,
desirability
and sustainability once the local authority has made its
decision. The environment may well be adversely affected by unneeded,
and
thus unsustainable, filling stations that become derelict, but
there was no evidence to suggest that this was a possibility.
6
In the circumstances I consider that Webster J in the court below
correctly held that the MEC, in having regard to the local
authority’s
obligations when making the rezoning decision,
applied his mind to these factors and took them into account when
making the decision
to allow construction of the filling station.
[18] It should be noted that the eleventh review ground raised by
Fuel Retailers is in effect a repeat of the complaint that the
MEC
did not properly take into consideration the questions of need,
desirability and sustainability since Hlatshwayo had relied on
the
earlier rezoning decision and the integrity of the officials in the
local authority who had made the decision. This is argued
to be an
impermissible, piecemeal approach. The argument must fail for the
same reason as does the argument that the MEC was not
entitled to
rely on the rezoning decision of the local authority in considering
the socio-economic factors: the approach was to take
into account a
decision made properly by the appropriate authority charged with the
duty to consider such matters. There was no evidence
at all that the
rezoning decision was subject to attack and nothing to show that
circumstances had subsequently changed.
Failure to consider alternatives to the proposed development
[19] Regulation 7(1)(b)
7
provides that in the ‘plan of study for an environmental impact
assessment’, there must be a description of the ‘feasible
alternatives identified during scoping that may be further
investigated’. Fuel Retailers argues that no feasible
alternatives
were considered. The scoping report explained why the
particular site was considered most suitable, and no other
possibilities were
placed before the MEC. In the circumstances there
were no feasible alternatives for the MEC to consider. This ground
accordingly
has no basis and is rejected.
Failure to consider the effect of the construction of fuel tanks
on the underground water system, particularly the aquifer
[20] Fuel Retailers raises five grounds of review which relate to
the potential contamination of the ground water, the aquifer in
particular, in the area. It was not in dispute that there is a
borehole on the property which has as its source an aquifer which
runs some 16 meters underground. (There is some confusion as to the
depth of the aquifer but this is not relevant to the issues.)
Fuel
Retailers alleges that the installation of fuel storage tanks and the
possibility of leaks of fuel into the natural water system
are
serious hazards, this despite the mitigatory measures that the
applicants are obliged to take.
[21] It is not necessary to deal with each ground separately. The
gravamen of the complaints is that the MEC delegated his
decision-making
power in respect of the construction of the filling
station and its effect on the natural water system by transferring
responsibility
to the DWAF. Further complaints are premised on an
alleged failure to appreciate criticisms of conclusions drawn by the
applicant’s
advisers.
[22] It will be recalled that the record of decision was made subject
to various conditions,
8
inter alia that the DWAF issue the necessary permits. The
consequence, argues Fuel Retailers, is that the DWAF in effect makes
the
decision whether the filling station can be constructed. Such
delegation is contrary to the requirements of PAJA and may be
reviewed
under s 6(2)(e)(ii) which provides that administrative
action is reviewable where the administrator acted under a delegation
of
power which was not authorised by the empowering provision; or
under s 6(2)((e)(iv) which makes reviewable action taken ‘because
of the unauthorised or unwarranted dictates of another person or
body’.
[23] The latter provision is plainly inapplicable. The decision was
made before there was any reference to the DWAF. Equally, there
was
no delegation of decision-making power: the decision was made and the
applicant was then required to obtain permits required
by the DWAF
and legislation. The MEC was in fact requiring further steps to be
taken to ensure the protection of the environment.
It is not the
DWAF, therefore, that decides whether or not to allow the
construction of a filling station. On the contrary: the DWAF
is
required by the MEC to monitor the project and to ensure that the
water system is protected while Lowveld Motors exercises its
right to
construct the filling station and instal underground fuel storage
facilities. There is thus no substance in these grounds
of review and
Webster J in the court below correctly dismissed them.
The alleged failure to take the views of engineers for Fuel
Retailers into account
[24] The complaint of Fuel Retailers in this regard is that both the
MEC and the DG did not appreciate nor take into account the
views of
the engineers De Villiers Cronje. As the respondents point out, the
proceedings in the court below were for a review of
the decision made
by the MEC. The complaints that he erred in understanding the
opinions of the experts would be grounds for appeal
but not review.
9
In any event, as the MEC and the DG point out, they considered the
reports placed before them: the criticisms levelled by De Villiers
Cronje at the geotechnical reports produced by Geo 3, allegedly
misunderstood by the MEC and the DG, were based entirely on De
Villiers
Cronje’s evaluation of the Geo 3 report and not on
their independent investigations. The decision of the court below
that the
MEC and DG had properly applied their minds to the various
reports and made a decision in good faith cannot be faulted.
The reservation of the right to amend the conditions of
authorisation
[25] The argument of Fuel Retailers in this regard is that once the
decision was made, and the appeal rejected, the MEC and the DG
had
discharged their functions and had no further authority to deal with
the application. However, the power to amend the conditions
is
reserved to cover new or unforeseen environmental circumstances: reg
9(3)
10
provides that after the relevant authority has made a decision it may
‘from time to time, on new information, review any condition
determined by it . . . and if it deems it necessary, delete or amend
such condition, or at its discretion, determine new conditions,
in a
manner that is lawful, reasonable and procedurally fair’.
Accordingly there can be no objection to the inclusion of this
term.
If the relevant authority were to act contrary to the provisions of
the regulation there might be cause for complaint. But
that has not
arisen. Accordingly, in my view, the court below correctly rejected
this ground of review.
[26] The decision of Webster J to reject the application for the
review of the decisions of the MEC and the DG on all the grounds
raised by Fuel Retailers must thus be upheld.
[27] The appeal is dismissed with costs.
_____________
C H LEWIS
Judge of Appeal
CONCUR:
HARMS JA
CONRADIE JA
MAYA JA
CACHALIA AJA
1
GN R1182 and 1183,
GG
18261 of 5 September 1997.
2
[
2006] 2 All SA 17
(SCA).
3
2004 (5) SA 124
(W) especially at 144B-D.
4
Unreported judgment of the Pretoria High Court, case 3016/05, handed
down on 18 March 2005.
5
Unreported judgment of Pretoria High Court per Legodi
J, case 3104/04, handed down
11
March 2005 also
cited at
[2006] JOL 16554
(T)
.
6
See, however, the discussion of the need to
consider the impact of social, economic and environmental activities
together in Tracy-Lynn
Field ‘Sustainable development versus
environmentalism: competing paradigms for the South African EIA
regime’
(2006) 123
SALJ
409.
The author argues that attempting to ‘separate the
commercial aspects of a filling station from its environmental
features
is not only impractical but makes little sense from an
environmental perspective’. She relies in this regard on the
decision
in
Sasol
above para 15.
7
Regulations in respect of listed activities under
s 21 of ECA, promulgated under ss 26 and 28 of the ECA in GN R1183
GG
18261
of 5 September 1997.
8
Section 22(3) of the ECA provides that authorization may be granted
subject to conditions and t
he regulations
expressly make it possible for a decision to be issued subject to
conditions: reg 10(2)(g) states that the record
of decision must
include the conditions of the authorisation including measures to
mitigate, control or manage environmental impacts
or to rehabilitate
the environment.
9
See
Johannesburg Stock Exchange v Witwatersrand Nigel Ltd
1988 (3) SA 132
(A) and
Pretoria Portland Cement Co Ltd v
Competition Commission
2003 (2) 385 (SCA) para 35.
10
Inserted in GN R1183
GG
18261
by GN R672 of 10 May
2002.