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[2009] ZAGPPHC 32
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Khumalo and Another v South African Reserve Bank and Another (50711/2008) [2009] ZAGPPHC 32 (24 April 2009)
IN THE HIGH COURT OF SOUTH
AFRICA
(NORTH AND SOUTH GAUTENG HIGH
COURT, PRETORIA)
Date: 2009-04-24
Case Number:
50711/2008
In the matter between:
KHUMALO,
MZILIKAZI GODFREY
First
Applicant
MAWENZI RESOURCES AND FINANCE
COMPANY
(PTY) LTD
Second
Applicant
and
THE SOUTH
AFRICAN RESERVE BANK
First
Respondent
THE MINISTER OF
FINANCE
Second
Respondent
JUDGMENT
SOUTHWOOD J
[1]
The
South African Reserve Bank (‘SARB’), the first respondent
in the application brought by the first and second applicants,
applies for leave to appeal against the judgment and order granted
against it on 19 February 2009. In terms of the order the notice
of
attachment issued by SARB on 12 August 2008 in terms of Regulation
22C(1) of the Exchange Control Regulations, Annexure MGK1
to the
founding affidavit, was declared to be invalid. This was final
relief and the court did not grant or refuse any of the
interim
relief sought by the applicants.
[2] The first and
second applicants filed a notice of application for leave to
cross-appeal to the Supreme Court of Appeal ‘in
respect of
those parts of the judgment and the order made by the Full Court on
19 February 2009 that are described below’.
These parts of the
judgment are nothing more than this court’s failure to grant
some of the interim relief sought in the
notice of motion. The
applicants’ notice states that if the first respondent were to
be granted leave to appeal and that
appeal were to succeed, the
applicants will contend that the full court ought to have granted
this interim relief.
[3] SARB applies in
terms of Rule 30 to set aside, as an irregular step, the first and
second applicant’s notice of application
for leave to
cross-appeal. SARB seeks this relief on the following grounds:
(1) This court’s failure to
grant interim relief does not constitute a judgment or order which
can be appealed against in
terms of section 20(1) of Act 59 of 1959;
(2) The
applicants’ failure to comply with Rule 49(1)(b) by not
recording the grounds upon which leave to appeal is sought;
(3) It is not
permissible to seek leave to cross-appeal on condition that leave
to appeal is granted and the appeal succeeds.
[4] With regard to
SARB’s application for leave to appeal, I am satisfied in the
light of the legal arguments and authorities
now advanced that the
first respondent has a reasonable prospect of success in the appeal.
Accordingly leave to appeal to the
Supreme Court of Appeal will be
granted to the first respondent.
[5] It will be
convenient to deal with the applicants’ application for leave
to cross-appeal and SARB’s application
to set aside the notice
of application for leave to cross-appeal together as the same issues
arise in both. In the main application
the applicants sought an
interim order declaring invalid the notice of attachment issued by
SARB in terms of Regulation 22C(1)
of the Exchange Control
Regulations; interdicting and restraining the first respondent from
taking any steps to implement or give
effect to the notice of
attachment and directing that the applicants may continue to exercise
whatever rights of ownership they
have in the assets listed in
paragraphs 6.1 to 6.17 of the notice of attachment, unencumbered by
the issue of the notice of attachment.
The applicants sought this
relief pending the outcome of an action to be instituted in which the
applicants would seek orders
reviewing and setting aside Regulations
22B, 22C and 22D of the Exchange Control Regulations and/or declaring
these regulations
to be unconstitutional; alternatively, an order as
contemplated in Regulation 22D reviewing and setting aside the notice
of attachment
and an order declaring
section 9(2)(d)(i)
of the
Currency and Exchanges Act, 9 of 1933
, to be unconstitutional.
[6] One of the
grounds relied upon for the invalidity of the notice was that
Regulation 22C(1) of the Exchange Control Regulations
was
ultra
vires
.
As appears from paragraph [3] of the judgment appealed against the
parties agreed that the relevant facts were before the court,
that
there were no real disputes of fact and that if the court were to
uphold the applicants’ contentions regarding
ultra
vires
and/or
the Regulation 22D review, the court should simply grant a final
order declaring the notice invalid. Clearly that was the
real relief
sought in the application and that is what the court granted. This
was also consistent with the general principle
that when it is
possible to decide any case without reaching a constitutional issue,
that course should be followed (
S
v Mhlungu and Others
[1995] ZACC 4
;
1995
(3) SA 867
(CC)
para
59;
National
Coalition for Gay and Lesbian Equality v Minister of Home Affairs
2000
(2) SA 1
(CC)
paras
21 and 22). Consequently it was neither permissible nor desirable
for the court to grant any interim relief. At the hearing
the
applicants did not contend that in addition to the final relief the
court should grant interim relief. This would have been
nonsensical.
[7] The
applicants’ notice of application for leave to cross-appeal
states that the application is made in terms of section
20(4)(b) read
with section 20(1) of Act 59 of 1959 and Rule 49(1) read with Rule
49(4) of the Uniform Rules of Court. Section
20 clearly provides for
an appeal against a judgment or order of the court (
Zweni
v Minister of Law and Order
1993
(1) SA 523
(A)
at
531B-C). It is well-settled that such a judgment or order generally
is a decision which has three attributes: (i) the decision
must be
final in effect and not susceptible to alteration by the court of
first instance; (ii) it must be definitive of the rights
of the
parties, i.e. it must grant definitive and distinctive relief; and
(iiI) it must have the effect of disposing of at least
a substantial
portion of the relief claimed in the main proceedings (
Zweni
v Minister of Law and Order supra
at
532J-533B;
South
African Chemical Workers Union v African Commerce Developing Co (Pty)
Ltd t/a Buffalo Tapes
2000
(3) SA 732
(SCA)
at
737I-J). SARB contends that no such order was made in respect of
interim relief and accordingly there cannot be an appeal.
The
applicants contend that this court in effect refused to grant interim
relief and that such refusal is appealable (
Van
Niekerk v Van Niekerk
2008
(1) SA 76
(SCA)
para
9). In my view the applicants’ contention is ill-founded. As
appears from the judgment appealed against this court
did not refuse
the application for interim relief. Once it held that Regulation
22C(1) was
ultra
vires
it
did not consider the interim relief let alone refuse it. I agree
with SARB that if leave is granted and the appeal is upheld
the
Supreme Court of Appeal will in all likelihood refer the remaining
issues back to this court for their determination (
Aktiebolaget
Hässle and Another v Triomed (Pty) Ltd
2003
(1) SA 155
(SCA)
).
[8] In terms of
Rule 49(1) the party seeking leave is required to furnish the grounds
for the application. The applicants’
notice of intention to
apply for leave to cross-appeal does not contain any grounds. It
simply sets out the background and the
interim relief which it is
contended should have been granted. On the face of it the notice
does not comply with the rule and
the application is fatally
defective (
Songono
v Minister of Law and Order
1996
(4) SA 384
(E)
at
385C-386B).
[9] It also seems
wrong
in the circumstances of this case to grant leave to appeal which is
conditional upon the first respondent obtaining leave
to appeal and
succeeding in that appeal. This court cannot predict the outcome of
the first respondent’s appeal and it will
make no sense to
grant leave on that basis.
[10] In my view the
applicants’ application for leave to cross-appeal is bad in
law and must be refused.
[11] SARB’s
application in terms of Rule 30 to set aside the notice of
application for leave to cross-appeal was
ex
abundanti cautela.
All
the points raised in that application could have been raised at the
hearing of the application for leave to appeal and SARB
was not
prejudiced by the fact that the applicants delivered the notice. The
application therefore cannot succeed and SARB is
not entitled to the
costs of the application. In the circumstances it is not appropriate
to make an order in the application.
Order
[12
] I Leave
is granted to the first respondent to appeal to the Supreme Court
of Appeal against the judgment and order of this
court granted on
19 February 2009;
II The costs of the application for
leave to appeal are to be costs in the appeal and such costs will
include the costs consequent
upon the employment of two counsel;
III The applicants’
application for leave to cross-appeal is refused with costs, such
costs to include the costs consequent
upon the employment of two
counsel.
________________________
B.R. SOUTHWOOD
JUDGE OF THE
HIGH COURT
I agree
________________________
J.R. MURPHY
JUDGE OF THE
HIGH COURT
I agree
________________________
T.J. RAULINGA
JUDGE OF THE
HIGH COURT
CASE NO:
50711/08
HEARD
ON: 23 April 2009
FOR
THE APPLICANTS: ADV. A.R. BHANA SC
A.
COCKRELL
INSTRUCTED
BY: Mr A.B. Smith of Maritz Smith Matshidiso Inc
FOR
THE FIRST RESPONDENT: ADV. P.G. GINSBURG SC
K.W.
LÜDERITZ
INSTRUCTED
BY: Dr. D.H. Botha of Newtons Attorneys
DATE
OF JUDGMENT: 24 April 2009