SLC Property Group (Pty) Ltd and Another v Minister of Environmental Affairs and Economic Development (Western Cape) and Another (5542/2007) [2007] ZAWCHC 58; [2008] 1 All SA 627 (C) (26 October 2007)

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[2007] ZAWCHC 58
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SLC Property Group (Pty) Ltd and Another v Minister of Environmental Affairs and Economic Development (Western Cape) and Another (5542/2007) [2007] ZAWCHC 58; [2008] 1 All SA 627 (C) (26 October 2007)

36
Reportable
IN THE HIGH COURT OF SOUTH AFRICA
[CAPE OF GOOD HOPE PROVINCIAL DIVISION]
CASE NO: 5542/2007
In the matter between:
SLC PROPERTY GROUP (PTY) LTD First
Applicant
LONGLANDS
HOLDINGS (PTY) LTD Second Applicant
and
THE MINISTER OF ENVIRONMENTAL
AFFAIRS
AND ECONOMIC DEVELOPMENT
(WESTERN
CAPE) First Respondent
MUNICIPALITY
OF STELLENBOSCH Second Respondent
JUDGMENT DELIVERED ON 26
th
OCTOBER 2007
HJ ERASMUS, J
Introduction
[1] On 21
st
July 2003 HF Smith (“Smith”) purchased the Remainder of Portion
11 of the farm Longlands Nr 393, situate within the Municipality
of
Stellenbosch (“the property” or “the Longlands Farm”), from
AF Kennedy (“Kennedy”). In terms of further agreements
between
Smith, Kennedy and the second applicant, the second applicant
replaced Smith as the purchaser of the property. Smith is the
principal shareholder and managing director of the second applicant.
[2] It is Smith’s intention to develop the property.
For this purpose the following is needed:
Authorisation by the first respondent to undertake
certain activities as envisaged in section 22 of the Environment
Conservation
Act 73 of 1989 (“ECA”)
Approval by the second respondent of the rezoning and
subdivision of the property under the Land Use Planning Ordinance 15
of 1985
(“LUPO”).
This
case is concerned solely with the application for authorisation under
ECA.
[3] The development proposed on the Longlands Farm
entails the following:
An agricultural village comprising of 106 low cost
houses;
A guest house comprising of 6 double free standing
rooms with en-suite bathrooms, reception area, administration
offices, dining
room, lounge, bar, swimming pool, conference room,
kitchen, food storage room, laundry area, staff area and garden area
surrounded
by vineyards;
A farm component comprising the owner’s and farm
manager’s houses and farm outbuildings;
An up-market agricultural residential estate comprising
of 100 single residential units;
A reservoir with sufficient capacity to support the
agricultural village.
Five small off-stream dams with a capacity of 45 –
60ml;
A 2,5km pipeline to remove sewerage and a second 2,5km
pipeline to return treated sewerage affluent to the development.
[4] The proposed development entails various activities
which are identified in Schedule 1 of Government Notice R1182 of 5
th
September 1997, as amended, read with Section 22 of the ECA, which
may have a substantially detrimental effect on the environment
and
require authorisation in terms of that Act.
[4] The application form and scoping checklist for
environmental authorisation for the development was submitted during
November 2003.
An environmental impact report (EIR) which supported
the application was submitted during October 2004.
[5] The application for environmental authorisation was
decided, eighteen months later, on 22
nd
May 2006 by the Director: Integrated Environmental Management, Mr
Chris Rabie, who was the delegated officer of the first respondent’s
department authorised to deal with the matter in terms of Section 33
of ECA. In his “Record of Decision” (hereafter “the First
ROD”), the delegated officer authorised all of the identified
activities save for the up-market agricultural residential estate
and
the system of 5 small off-stream dams.
[6] An appeal was noted against the above decision
during June 2006. Early in March 2007 the applicants launched
mandamus
proceedings
in an effort to force the first respondent to come to a decision on
the appeal that had been noted.
[7] On 26
th
Match 2007, some two weeks after service of the papers in the
mandamus
proceedings,
the first respondent’s attorneys notified the applicants’
attorneys by way of a telephone call that the first respondent’s
decision on the appeal would be ready on 27
th
March 2007. During the course of the day on 27
th
March 2007, the applicants received a document by fax under cover of
a letter in which it is stated: “As discussed a copy of the
Minister’s decision is attached for your perusal”.
[8] The document is headed: “Appeal Decision of
Minister Tasneem Essop Minister for environment, Planning and
Economic Development”.
This document will hereafter be referred to
as the “Appeal Decision”. The document is dated 27
th
March 2007 and bears the signature of the first respondent. The
effect of the Appeal Decision
1
is that the appeal is upheld and the decision of the delegated
officer is varied to allow for the upmarket agricultural residential
estate. A condition is, however, imposed in relation to the provision
of “gap housing” in the proposed development.
[9] On 11
th
April 2007 the applicants received a further fax from the first
respondent. The document so faxed purports to be an amended Record
of
Decision (hereafter “the Second ROD”). The Second ROD is also
dated 27
th
March
2007 and it also bears the first respondent’s signature. The Second
ROD also upholds the appeal and approves the application
in its
entirety, but it contains a number of provisions and conditions which
were not included in the First ROD and which are neither
mentioned
nor foreshadowed in the Appeal Decision.
[10] The foregoing background facts are largely common
cause between the parties. The only major difference between the
parties relates
to the status of the Appeal Decision and of the
Second ROD. The applicants contend that the Appeal Decision is what,
on the face
of it, it purports to be; namely, the first respondent’s
decision on the appeal, and that the Second ROD is a later document.
The
first respondent’s case is that the Second ROD was first
drafted, and that its terms were thereafter summarised in the Appeal
Decision.
The issues
[11] The principal issue between the parties is,
accordingly, which document is the first respondent’s decision on
the appeal, the
Appeal Decision or the Second ROD? The applicants
seek an order setting aside the Second ROD and, on the basis that the
Appeal Decision
represents the first respondent’s decision of the
appeal, an order setting aside the condition relating to the
provision of “gap
housing” contained therein. In the alternative,
on the basis that the Second ROD represents the first respondent’s
decision of
the appeal, the applicants seek an order setting aside a
number of the conditions contained therein.
[12] The applicants further seek an order for the
payment of damages they allege they suffered as a result of the time
it took the
first respondent and the officials in her Department to
come to a decision on the application and thereafter on the appeal
that had
been noted.
[13] The first respondent raised two issues
in
limine
; namely that the application is not
urgent, and that the first applicant does not have
locus
standi
. It will be convenient to deal first
with the issues
in limine
.
Urgency
[14] In the answering affidavit, the first respondent
raised the contention that the application is not urgent. By the time
the matter
was heard on 29
th
August 2007 the contention had silently expired. The parties had in
the meantime agreed upon a date for the hearing of the application,
upon a timetable for the filing of further affidavits and the filing
of heads of argument. In argument nothing was made of the issue.
Lack of locus standi
[15] The first applicant is a company whose business
encompasses property management, project management and financial
administration.
Its business also includes the administration of
applications for development rights and as such, the first applicant
initiated the
application for development rights in respect of the
Longlands Farm. The first respondent contends that the foregoing
factors do
not give the first applicant a direct and substantial
interest in the present proceedings and that the first applicant
accordingly
lacks
locus standi
to bring the present proceedings.
[16] The first applicant relies on section 36 of ECA
which provides as follows:
(1) Notwithstanding the
provisions of section 35, any person whose interests are affected by
a decision of an administrative body
under this Act, may within 30
days after having become aware of such decision, request such body in
writing to furnish reasons for
the decision within 30 days after
receiving the request.
(2) Within
30 days after having been furnished with reasons in terms of
subsection (1), or after the expiration of a period within
which
reasons had to be so furnished by the administrative body, the person
in question may apply to a division of the Supreme Court
having
jurisdiction, to review the decision.
[17] Mr Potgieter, SC who appeared with Ms Golden on
behalf of the first respondent, submitted that the wording of the
section is
clear and unequivocal in that it is only a person whose
interests are affected by the decision in question who enjoys the
right to
take the decision on review. The common law position
regarding
locus standi
accordingly obtains: what is required is a direct and substantial
interest in the right which is the subject matter of the litigation
and in the outcome of the proceedings. In particular, it is submitted
that the right of review in terms of the section is not a right
encapsulated in the Bill of Rights, and that section 38 of the
Constitution is not applicable.
[18] These submissions are untenable. In
Fuel
Retailers of Southern Africa v Director General, Environmental
Management, Department of Agriculture, Conservation and Environment,
Mpumalanga Province and Others
2
it was held
3
:
In
Bato Star
this Court held that “[t]he cause of action for the judicial review
of administrative action now ordinarily arises from PAJA
4
,
not from the common law as in the past”.
5
Section 36 of ECA does no more than to provide for the review of
decisions of environmental authorities. The grounds upon which
decisions
under ECA may be reviewed are those set out in PAJA. The
clear purpose of PAJA is to codify the grounds of review of
administrative
action. The fact that section 36 of ECA allows a
person whose interests are affected by a decision of an
administrative body under
ECA to approach the High Court for review,
does not detract from this. The provisions of section 36 must
therefore be read in conjunction
with PAJA which sets out the grounds
on which administrative action may now be reviewed.
PAJA contains no explicit provisions about standing. In
view of the fact that PAJA aims to give effect to section 33 of the
Constitution,
the standing requirements provided for in section 38 of
the Constitution apply also with respect to review applications under
PAJA.
6
[19] It has been stressed on more than one occasion that
within the constitutional context the “categories of persons who
are granted
standing to seek relief are far broader than our common
law has ever permitted”.
7
In
Ferreira v Levin NO and Others; Vryenhoek
and Others v Powell NO and Others
8
Chaskalson P said in this regard:
Whilst it is important that this Court should not be
required to deal with abstract or hypothetical issues …. I can see
no good
reason for adopting a narrow approach to the issue of
standing in constitutional cases. On the contrary, it is my view that
we should
rather adopt a broad approach to standing.
[20] Section 38(a) of the Constitution provides that a
person who acts in his or her own interest has the right to approach
a competent
court for relief where a right in the Bill of Rights has
been infringed or threatened. The subsection reflects the position at
common
law, but it seems to go beyond the common law in that the type
of interest required by it is less stringent than the “sufficient,
personal and direct” interest demanded at common law.
9
In
Ferreira v Levin NO and Others; Vryenhoek
and Others v Powell NO and Others
10
the majority of the Constitutional Court took
the view that it is enough if the complainant is affected directly by
the conduct complained
of.
11
[21] The first applicant in seeking relief acts in its
own interest. That the interest it seeks to protect is not an
“abstract and
hypothetical issue” is apparent from paragraph 16
of the founding affidavit in which the position of the first
applicant is set
out as follows:
Toe ek aanvanklik die eiendom van Kennedy gekoop het
was dit ons gemeenskaplike bedoeling dat ‘n
ontwikkelingsmaatskappy mettertyd
gevorm sou word en dat dit, en
nie ek nie, uiteindelik die ontwikkeling sou doen.
Eerste Applikant se besigheid sluit in die
administrasie van aansoeke om ontwikkelingsregte. As sodanig het
dit dan ook die aansoek
om ontwikkelingsregte geïnisieer. Op
daardie stadium het Tweede Applikant nog nie bestaan nie. Die
gemeenskaplike bedoeling
van die partye was egter dat indien
ontwikkelingsregte uiteindelik bekom word, hierdie regte aan ‘n
ontwikkelingsmaatskappy
oorgedra sou word.
Tweede Applikant is later gevorm, en dit is die
onwikkelingsmaatskappy wat in paragrawe 16.1 en 16.2 voorsien word.
Dit het gelei
tot die drieledige ooreenkoms en die kontrak
(Aanhangsel “A”) waarna hierbo verwys is.
Eerste Applikant is nie in die besigheid van
eiendomsontwikkeling nie. Gevolglik, na Tweede Applikant opgerig
is, het Eerste en
Tweede Applikant ‘n ooreenkoms gesluit
ingevolge waarvan Eerste Applikant homself verbind het om die
ontwikkelingsregte aan
Tweede Applikant oor te dra. Alles is dus
nou in plek vir die oordrag van die ontwikkelingsregte.
[22] The first applicant accordingly has a direct
interest in the grant of the development rights, and a concomitant
interest therein
that the application for the grant of those rights
be dealt with in a manner which is procedurally fair. In my view, the
first applicant
has the necessary standing to join in bringing these
proceedings.
The status of the Appeal Decision and of the
Second ROD
[23] The attitude of the first respondent is summarised
as follows in counsel’s heads of argument:
Applicants’ case in this regard is based upon the
obvious factually incorrect premise that there were somehow two
decisions taken
by First Respondent. The facts in this regard are
clear as set out in the answering affidavit. First Respondent only
took one decision
on 27 March 2007. A summary of the outcome of the
appeal was urgently communicated to Applicants to avert the pending
mandamus
application.
The decision was recorded in a formal Record of Decision as required
by the EIA Regulations.
12
There was accordingly no duplication of decisions as contended by
Applicants. The
functus officio
argument accordingly simply fails on the facts and there is no basis
for setting aside the entire Appeal ROD
13
.
[24] The full text of the operative part of the Appeal
Decision is as follows;
Appeal
Decision of Minister Tasneem Essop
Minister
for Environment, Planning and Economic Development
Minister’s
comments/variation of delegated officer’s decision and reasons for
appeal decision.
I herby uphold the appeal and vary the decision of the
delegated officer by varying condition 4 to allow for the upmarket
residential
estate comprising 100 single residential units and the
system of 5 small off stream dams with capacity of 45-60Ml on portion
1 of
the Farm Longlands No 393, Vlottenburg. It is clear that the
application can only be considered as a holistic development where no
single part can be separated from the whole, as each component is
dependent on the other. The Longlands Development as a whole should
be incorporated into the Vlottenberg Hamlet as a development node.
However, a further condition of approval would be for the applicant
to accommodate on the site of the development 20% for gap housing in
the R3500-R7500 income category.
DURATION AND DATE OF EXPIRY
This authorisation shall lapse if the activity does not
commence within two (2) years of the date of issue of the decision.
[25] The facts to be considered in this regard are the
following:
On 26
th
March 2007 the first respondent’s attorneys notified the
applicants’ attorneys by way of a telephone call that the first
respondent’s
decision on the appeal would be ready on 27
th
March 2007.
During the course of the day on 27
th
March 2007, the applicants received by fax a document which on the
face of it appears to be the first respondent’s decision on
the
appeal.
The
fax was under cover of a letter in which it is stated: “As
discussed a copy of the Minister’s decision is attached for your
perusal”.
The document is headed: “Appeal Decision of Minister
Tasneem Essop Minister for Environment, Planning and Economic
Development”.
The document is dated 27
th
March 2007 and bears the signature of the first respondent.
The first sentence of the operative part of the document
reads: “I hereby uphold the appeal and vary the decision of the
delegated
officer by varying condition 4 ….”
In
the final sentence of the document, under the heading Duration and
Date of Expiry, it is stated: “This authorisation shall lapse
if
the activity does not commence within two (2) years of the date of
issue of this decision”.
From
the document itself it is apparent that it clearly is what it
purports to be; namely, a decision on the appeal. It was communicated
as such to the applicants.
[26] The first respondent says that the decision on the
appeal was reached on the 27
th
March 2007 and that a summary of the outcome of the appeal was
urgently communicated to applicants to avert the pending
mandamus
application. The question arises, if the decision on the appeal was
reached on 27
th
March 2007 and the record of the decision (as embodied in the Second
ROD) was prepared and signed on that day, why prepare and send
a
summary of the decision? Moreover, an undertaking was given to the
applicants that the decision on the appeal would be made available
on
27
th
March 2007 –
no mention was ever made of a summary of some kind being provided.
Finally, the Appeal Decision is in fact not a summary
of the Second
ROD: the Appeal Decision gives no inkling, not even in general
terms, of the imposition of a number of new conditions
which were not
included in the First ROD.
[27] The first respondent says that her decision on
appeal was recorded in a formal Record of Decision as required by the
Regulations
framed under the ECA.
14
The regulations deal with applications for authorisation to
undertake an activity as contemplated in section 22(1) of ECA.
Regulation
10(1) provides that the “relevant authority”
15
–
must issue a record of decision that was taken under
regulation 9(1) to the applicant, and on request to any other party.
The
form the record of decision must take is prescribed in Regulation
10(2).
Regulation 9 deals with the consideration of an
application for authorisation to undertake an activity as
contemplated in section
22(1) of ECA. Regulation 9(1) provides:
After the relevant authority has made a decision
contemplated in regulation 6(3)(a), or has received an environmental
impact report
that complies with regulation 8, as the case may be,
the relevant authority must consider the application and may decide
to –
issue an authorisation with or without conditions; or
refuse the application.
Regulation 6 deals with scoping reports. Regulation
6(3)(a) provides as follows:
(3) After a scoping report has been accepted, the
relevant authority may decide –
that the information contained in the scoping report is
sufficient for the consideration of the application without further
investigation;
or
……
Regulation 11 deals with appeals. Regulation 11(1)
provides:
An appeal to the Minister or provincial authority under
section 35(3) of the Act, must be done in writing within 30 days
from the
date on which the record of decision was issued to the
applicant in terms of regulation 10(1).
[28] From the foregoing it is apparent that Regulation
10 prescribes the form which the record of the decision of the
relevant authority
on the initial application for authorisation must
take. The form a decision on appeal must take is not prescribed in
the Regulations.
There was accordingly no obligation on the first
respondent to clothe her decision on appeal in a Record of Decision
in the form
prescribed in Regulation 10.
[29] An administrative decision becomes final when it is
“published, announced or otherwise conveyed to those affected by
it”,
16
or, as it is put in
President
of the Republic of South Africa and Others v South African Rugby
Football Union and Others
,
when the decision is “translated into an
overt act”.
17
The Appeal Decision, which in form and content has the attributes of
a final decision, was duly conveyed to those affected by it.
The
Appeal Decision is, therefore, a final decision.
[30] The first respondent’s explanation in the
answering affidavit of the genesis of the Appeal Decision and the
Second ROD is so
clearly untenable that this Court would be justified
in rejecting it on the papers.
18
Whenever and however the Second ROD came into being, it is common
cause that it was conveyed to the applicant on 11
th
April 2007. Before that date it was “inchoate”.
19
By 27
th
March 2007
the applicants were already in possession of the Appeal Decision
which, as has been held above, is the first respondent’s
final
decision on the appeal.
[31] Once a final decision has been taken, that decision
cannot be revisited, the public authority who had taken the decision
being
functus officio
.
20
The Second ROD accordingly falls to be set aside in its entirety as
an unlawful administrative act.
The condition imposed by the Appeal Decision
[32] In the Appeal Decision, the first respondent
imposed as “a further condition of approval” a condition that the
applicant
“accommodate on the site of the development 20% for gap
housing in the R3500-R7500 income category”. The applicants contend
that
the condition should be set aside on several grounds.
[33] The
applicants contend that in imposing the condition, the first
respondent acted beyond the powers conferred on her by law.
It is a
trite principle of our law that the legislature and the executive –
…
..
in every sphere are constrained by the principle that they may
exercise no power and perform no function beyond that conferred
upon
them by law.
21
In
this matter, the first respondent derived her powers from sections
21, 22 and 35 of ECA.
[34] The applicants appealed under section 35(3) of ECA
against the decision of an officer in the first respondent’s
department
exercising power delegated to him in terms of ECA. Section
35(4) provides that the first respondent, after considering the
appeal,
may “confirm, set aside or vary” the decision.
[35] The first respondent decided,
inter
alia
, to vary the decision of the delegated
officer. In doing so she was obliged to act within the powers
lawfully conferred on her. Part
V of ECA provides for the control by
the Minister concerned of activities which may have a detrimental
effect on the environment.
Section 21 of ECA provides that the
Minister may identify by notice activities which in his or her
opinion may have a substantial
detrimental effect of the environment.
The Minister has identified such activities in a Schedule to a
Government Notice published
in the
Government
Gazette
.
22
Section 22 of ECA prohibits the undertaking of any of the identified
activities except by written authorisation by the Minister or
other
competent authority. Subsection (2) of section 22 of ECA provides:
The authorisation referred to in subsection (1) shall
only be issued after consideration of reports concerning the impact
of the proposed
activity and of alternative proposed activities on
the environment, which shall be compiled and submitted by such
persons and in
such manner as may be prescribed.
[36] In
Fuel Retailers
Association of Southern Africa v Director-General Environmental
Management, Department of Agriculture, Conservation
and Environment,
Mpumalanga Province and Others
23
the Constitutional Court had occasion to consider the provisions of
section 24 of the Constitution along with the provisions of
the
National Environmental Management Act 107 of 1998
and of ECA. In
regard to authorisation under
section 22(1)
of ECA it is said
24
:
The decision to grant or refuse authorisation in terms
of
section 22(1)
of ECA must be made in the light of the provisions
of the National Environmental Management Act, 1998 (“NEMA”). One
of the declared
purposes of NEMA is to establish principles that will
guide organs of state in making decisions that may affect the
environment.
One of these principles requires environmental
authorities to consider the social, economic and environmental impact
of a proposed
activity including is “disadvantages and benefits”.
Later in the judgment it is stated
25
:
The need for development must now be determined by its
impact on the environment, sustainable development and social and
economic
interests. The duty of environmental authorities is to
integrate these factors into decision-making and make decisions that
are informed
by these considerations. This process requires a
decision-maker to consider the impact of the proposed development on
the environment
and socio-economic conditions.
With reference to the application in that case, an
application to build a filling station, it is said:
26
What was required of the environmental authorities
therefore was to consider the impact on the environment of the
proliferation of
filling stations as well as the impact of the
proposed filling station on existing ones. This conclusion makes it
plain that the
obligation to consider the socio-economic impact of a
proposed development is wider than the requirement to assess need and
desirability
under the Ordinance.
27
It also comprehends the obligation to assess the cumulative impact on
the environment of the proposed development.
and further
28
A proposed filling station may affect the sustainability
of existing filling stations with consequences for the job security
of the
employees of those filling stations. But that is not all: if
the proposed filling station leads to the closure of some or all of
the existing filling stations, this has consequences for the
environment. Filling stations have a limited end use. The underground
fuel tank and other infrastructure may have to be removed and land
may have to be rehabilitated.
Apart from this, the proliferation of filling stations
in close proximity to one another may increase the pre-existing risk
of an
adverse impact on the environment. The risk that comes to mind
is the contamination of underground water, soil, visual intrusion
and
light.
From the foregoing it is clear that under ECA it was
incumbent upon the first respondent and her department to consider
the social,
economic and environmental
impact
of the proposed activity.
[37] In both the First and the Second ROD it is stated
that the proposed development on Longlands Farm relates to some of
the activities
identified in the Schedule to the Government Notice
issued pursuant to the provisions of section 21 of ECA,
29
the activities in question being:
Item 1(c) The construction, erection or upgrading of –
with regard to any substance which is dangerous or hazardous and is
controlled
by national legislation –
(ii) Manufacturing, storage, handling, treatment or
processing facilities for any such substance,
Item 1 (d) The construction, erection or upgrading of
roads, railways, airfields and associated structures.
Item (j) The construction, erection or upgrading of
dams, levees and weirs affecting the flow of a river.
Item (k) The construction, erection or upgrading of
reservoirs for public water supply.
Item (m) The construction, erection or upgrading of
public and private resorts and associated infrastructure.
Item
(n) The construction, erection or upgrading of sewerage treatment
plants and associated infrastructure.
Item
2 (c) The change of land use from agricultural or zoned undetermined
use or an equivalent zoning to any other land use.
It was incumbent upon the first respondent and her
department to consider the
social, economic
and environmental impact of the activities so identified
.
[38] From the answering affidavit it is apparent that
the first respondent relied heavily on a policy document of her
department which
dates back to 7
th
November 2005. The document is entitled
Western
Cape Provincial Spatial Development Framework
(“WCPSDF”). The WCPSDF is characterised as follows by the first
respondent:
The WCPSDF’s primary aim is to address the spatial
policies that have historically been used as a political tool to
shape the Western
Cape economy, our social fabric, and the way we use
our natural resources.
The
WCPSDF is a policy document and organs of state and officials must
take account of, and apply relevant provisions of policy when
making
decisions that affect the use of land in the Province. This policy is
not to be applied rigidly, but sensitively and in a
developmental way
that takes account of the particular circumstances of each case.
I
have considered and applied the relevant provisions of the WCPSDF
pertaining to inclusionary housing.
Having had due regard,
inter
alia
, to these policy guidelines, I imposed a
condition that 20% of the residential units of the development, be
allocated for “gap
housing” as specified. I deemed this condition
necessary for all the reasons set out above but also because there
existed a dire
need for affordable housing in that region.
[39] In the First ROD, the WCPSDF is listed among the
“Key Factors Affecting the Refusal of the Agricultural Residential
Estate
of the Proposed Development”. It is said that the WCPSDF
provides clear policy guidelines with regard to development beyond
the
urban edge and that urban development should only take place
within the urban edges of towns and cities. The proposed development
is outside Stellenbosch and would go against the policy of limiting
urban development to within an urban edge.
[40] That the WCPSDF is a policy document and no more is
apparent from the introduction to the document itself:
It is the intention of the Western Cape Government to
make relevant policies contained in the WCPSDF mandatory in terms of
legislation
and to include these policies in appropriate legislation.
The following words of Harms JA
30
are apposite to the first respondent’s use of the WCPSDF in the
present case:
I prefer to begin by stating the obvious, namely that
laws, regulations and rules are legislative instruments, whereas
policy determinations
are not. As a matter of sound government, in
order to bind the public, policy should normally be reflected in such
instruments. Policy
determinations cannot override, amend or be in
conflict with laws (including subordinate legislation). Otherwise the
separation between
Legislature and Executive will disappear …. In
this case, however, it seems that the provincial legislature intended
to elevate
policy determinations to the level of subordinate
legislation …
[41] In terms of the provisions of ECA the first
respondent is empowered, and obliged, to consider the impact of the
proposed development
and associated activities on the environment and
socio-economic conditions. The first respondent is not empowered by
ECA to implement
housing policies aimed at rectifying injustices of
the past.
[42] In
Pharmaceutical
Manufacturers Association of SA: In re Exparte President of the
Republic of South Africa
31
Chaskalson P said:
It is a requirement of the rule of law that the exercise
of public power by the Executive and other functionaries should not
be arbitrary.
Decisions must be rationally related to the purpose for
which the power was given, otherwise they are in effect arbitrary and
inconsistent
with this requirement. It follows that in order to pass
constitutional scrutiny the exercise of public power by the Executive
and
other functionaries must, at least, comply with this requirement.
If it does not, it falls short of the standards demanded by our
Constitution for such action.
The imposition of a condition which is aimed at the
implementation of a housing policy is not rationally related to the
purpose for
which the powers under ECA were given. Moreover, the
condition that was imposed is not rationally related to, nor is it
based on
or derived from information placed before the first
respondent in terms of the procedures prescribed in ECA and the
Regulations made
under ECA.
[43] The applicants say that the appeal process was
procedurally unfair in that the condition pertaining to the provision
of “gap
housing” was imposed without warning and without giving
the applicants an opportunity to comment. The applicants do not
contend
that in coming to her decision, the first respondent had
taken into consideration new facts.
32
The imposition of the condition arises from policy considerations
which were at no stage canvassed with the applicants. The policy
considerations do not feature in the First ROD, nor is there any
reference thereto in the executive summary prepared by the head
of
the first respondent’s department, dated 20
th
November 2006, relating to the applicants’ appeal. In the executive
summary, the first respondent’s attention is drawn to the
fact that
she has to decide whether it is necessary to grant an interview to
the parties concerning the matter, and that –
[a]ttention must be given to the
audi
alteram partem
principle whereby all parties
in the matter must be given an equal chance to state their case.
The applicants were not given the opportunity to state
their case on matters which vitally affect the proposed development.
[44] For the reasons stated, the condition should be set
aside under the provisions of section 6(2)(c) of PAJA.
Conditions in the Second ROD
[45] The applicants in the alternative, on the basis
that the Second ROD represents the first respondent’s decision of
the appeal,
seek an order setting aside a number of the conditions
contained therein. Though it has been held that the First ROD
embodies the
first respondent’s decision on appeal, it will be
expedient to deal with the contentions raised in regard to those
conditions,
also because they may have a bearing on the order as to
costs to be made in the end.
[46] The applicants raise objections to the conditions
contained in paragraphs G 3, G4, G 5, G7 and G8 of the Second ROD.
The conditions
and the objections are considered in turn.
[47]
The “gap-housing”
condition (G 3)
:
Twenty percent (20%) of the upmarket Estate development
shall contain 20% gap housing in the R2500 – R7500 income category.
The condition falls to be set aside on the ground that
in imposing it, the first respondent exceeded the powers conferred
upon her
under ECA. What is said above in paragraphs [32] to [44] in
regard to the gap-housing condition in the Appeal Decision also
applies
to this condition.
[48] Although the Appeal Decision is, on the first
respondent’s version of the facts, a summary of the Second ROD,
there are significant
differences in the wording of the condition as
it appears in the Appeal Decision and as it appears in the Second
ROD. In the Appeal
Decision, provision must be made “to accommodate
on the site of the development 20% for gap housing in the R3500-R7500
income category”.
In the Second ROD the condition provides for “20%
of the upmarket estate development to contain 20% gap housing in the
R2500 –
R7500 income category”. In the answering affidavit, the
first respondent says that she “imposed a condition that 20% of the
residential
units of the development” be allocated for gap-housing.
Not only is there a difference in the income category concerned, but
20%
of three different localities is to be allocated for gap housing:
20% of
the site of the development
;
20% of the
upmarket estate development
must contain 20% gap housing, and 20% of the
residential
units of the
development must be allocated
for gap-housing.
[49] It was submitted on behalf of the first respondent
that the applicants could have asked for reasons in terms of section
36 of
ECA or of the “relevant provisions” of PAJA to have the
condition clarified. The question arises why the ineptitude of the
first
respondent’s department should oblige the applicant to incur
further costs, and further delay, by asking for clarification of the
condition?
[50]
The rezoning condition (G
4)
:
Only the areas indicated for development of Figure 7
(Plan 3, 21 May 2004), ie the residential erven and Village shall be
rezoned
to sub-divisional area. The remainder of the property shall
remain as Agriculture 1 and shall be used solely for agriculture and
agriculture-related development in accordance with the applicable
zoning scheme.
The rezoning of the property for purposes of the
development is dealt with by the second respondent under the
provisions of LUPO.
33
The first respondent is involved with LUPO in that she decides
appeals against the decisions of a local authority made under LUPO.
34
In the present matter, the first respondent had before her an appeal
under ECA and she had to decide the appeal within the framework
of
the powers conferred on her by ECA.
[51]
The condition relating to
the provision of services (G 5)
:
The applicant shall provide the services for the Village
component of the development.
This is not a condition that pertains to the impact of
the identified activities on the environment and the imposition
thereof is
ultra vires
the
powers of the first respondent under ECA.
[52]
The condition relating to
the establishment of a trust fund and the contribution to building
costs (G 7) and the condition relating
to shortfall on building costs
(G 8):
G 7: The applicant shall establish a trust fund to be
comprised of the applicant, elected members of the Vlottenburg
Housing Forum
(or a similar community structure with the same
objectives) relevant municipal officials, representative(s) of
organisation(s) representing
the surrounding property owners and an
impartial profession al appointee (such as a firm of attorneys and
auditors). The trust shall
facilitate access to housing in the
Village by assisting the residents of Vlottenburg to pay the deposit
to access the Government
Housing Subsidy, the shortfall in the actual
costs of a house and the Government subsidy and for landscaping and
maintenance etc
of the Agricultural Village.
G 8: The actual cost of building a Village house shall
be determined and the applicant shall cover the shortfall between the
actual
cost and the Government subsidy.
Neither of these conditions relates to the impact of the
identified activities on the environment and the imposition thereof
is
ultra vires
the
powers of the first respondent under ECA.
The idea of the establishment of a trust fund originated
with the applicants but this would seem to be a matter for
negotiation between
all interested parties and not something to be
imposed by way of condition.
In regard to the content of the two conditions, the
following fall to be observed: (i) The two conditions impose an
unlimited financial
burden on the trust or on the applicant. (ii) The
two conditions are contradictory in that in the first the
trust
is required to
assist
the residents of the agricultural village in various ways, including
assistance to facilitate access to Government housing subsidy;
in the
second the
applicant
is required to
cover the shortfall between the
actual cost
and the Government subsidy.
Damages
[53] The agreement of sale between Kennedy and the
second applicant is subject, in terms of clause 9 of the agreement,
to the procurement
of the necessary consent to the change of land use
and the rezoning of portion of the property in order to enable the
development
to take place. Transfer of the property into the name of
the second respondent is to be effected not later than thirty days of
the
fulfilment of the aforesaid condition. Clause 4.3 of the
agreement of sale provides –
The purchase price shall escalate by an amount of R160
000.00 (One hundred and sixty Thousand Rand) plus VAT, for every
completed
calendar month and pro rata for any partially completed
calendar month calculated from 1 April 2004 to date of registration
of transfer.
Clause
10(1) of the agreement of sale provides that the seller shall refrain
from marketing the property pending fulfilment of the
provisions of
clause 9. Clause 10(2) provides:
As compensation for the above, the purchaser undertakes
to pay the seller an amount of R15 000.00 (Fifteen Thousand rand) per
month,
from the date hereof until the end of the calendar month in
which the provisions of paragraph 9 are fulfilled …..
[54] The applicants point out that a period of about
eighteen months elapsed from the submission of the EIR in October
2004 to the
decision embodied in the First ROD in May 2006, and that
a period of nine months elapsed from the noting of the appeal in June
2006
to the decision on the appeal at the end of March 2007. They
further point out that a decision on the appeal was made only after
mandamus
proceedings
had been instituted. On behalf of the second applicant it is
submitted that as a result of these delays on the part of
the first
respondent and her department, the second respondent is suffering a
loss of R175 000.00 per month. In the founding affidavit
it is in
this regard stated:
Eerste Respondent (of lede van die Department wat onder
haar resorteer), se voortdurende nalate om behoorlik aandag te gee
aan die
goedkeuring van hierdie ontwikkeling, veral inaggenome die
ekonomiese opheffing van ‘n arm gemeenskap en die verligting van
die
bestaande behuisingsnood in die Stellenbosch area wat dit sal
meebring, is dermate buitengewoon, en die verlies daardeur aan Tweede
Applikant bewerkstellig so onredelik en onregverdig, dat ‘n
toekenning van vergoeding aan Tweede Applikant gepas sou wees.
Sodanige
vergoeding word veroorloof deur Artikel 8(1)(c)(ii)(bb) van
Wet 3 van 2000. Daar word aan die hand gedoen dat dit gepas sou wees
om vergoeding te bereken teen R175 000.00 per maand vanaf 1 Oktober
2006, dws na verloop van meer as drie maande vanaf die indiening
vanaf Eerste Applikant se appèl by Eerste Respondent.
At the hearing, the second applicant modified its claim
to R160 000.00 per month calculated from 1
st
October 2006.
[55] PAJA recognises that an award of damages may
sometimes be justified in proceedings for judicial review. Section
8(1)(c)(ii)(bb)
provides that in “exceptional cases” the court
may direct “the administrator or any other party to the proceedings
to pay compensation”.
The wording of section 8(1)(c)(ii)indicates
that an award of compensation would usually be granted in addition to
an order setting
aside the administrative action.
35
In this matter the applicants seek both an order setting aside
certain administrative action, and a declaratory order in respect
of
other administrative action.
[56] Hoexter rightly points out
36
that motion procedure used in proceedings for administrative review
(embodied in Rule 53) is not designed for the resolution of disputes
of fact which tend to crop up in claims for damages. Although the
lengthy delay of about twenty-seven months on which the applicants
build their claim, appears,
prima facie
,
to be unreasonable, one cannot on the papers, without evidence,
determine what portion of that period should be used in calculating
their damages. And, despite the applicants’ assertion that the
claim for damages is liquidated, the quantification of the claim
may
need to be elucidated by evidence.
37
[57] In my view, this is not an appropriate matter for
an order for compensation under the provisions of PAJA.
Costs
[58] The applicants ask for an order of costs on the
scale as between attorney and client. They justify their request for
a punitive
order as to costs on the ground that first respondent’s
delegated officer took about eighteen months to come to a decision on
the
application, and that the first respondent thereafter took about
nine months to come to a decision on the appeal. The applicants
further point to administrative ineptitude of a high degree on the
part of the officials in the first respondent’s department:
two
documents, each on the face of it purporting to be a decision on the
appeal, and each bearing the signature of the first respondent,
were
communicated to the applicants; both documents contain new
conditions, imposed in disregard of the
audi
alteram
principle and, in some cases, in
excess of the powers conferred upon the first respondent under ECA;
some of the conditions are so
ineptly worded that compliance is
rendered virtually impossible. The administrative ineptitude in the
first respondent’s department
is indeed matter for concern. I have
given the applicants’ request careful consideration. I have come to
the conclusion, not without
some doubt, that a punitive order as to
costs is not justified.
[59] The second respondent did not participate in the
proceedings and no order to costs is made in relation to the second
respondent.
Order
[60] For
the reasons stated, it is ordered as follows:
The decision taken by the first respondent as
contained in the Record of Decision dated 27
th
March 2007 and annexed to the founding papers as Annexure “I”
(the “Second ROD”) is hereby reviewed and set aside.
2. The decision taken by the first respondent on 27
th
March 2007 entitled “Appeal Decision of Minister Tasneem Essop
Minister for Environment, Planning and Development” and annexed
to
the founding papers as Annexure “G” (the “Appeal Decision”)
is hereby reviewed and the following condition contained therein
is
set aside: “However, a further condition of approval would be for
the applicant to accommodate on the site of the development,
20% for
gap housing in the R3 500.00 – R7 500.00 income category.”
3. It is declared, subject to paragraph 4 hereunder,
that the valid and operative decision is that contained in the Record
of Decision
signed on 22
nd
May
2006 by Mr Chris Rabie, Director: Integrated Environmental Management
(Region A) in the Department of Environmental Affairs and
Development
Planning, and annexed to the founding papers as Annexure “C” (the
“First ROD”), as amended by the Appeal Decision
referred to in
paragraph 2 above.
4. Paragraph I of the First ROD under the heading
DURATION AND DATE OF EXPIRY
is
amended to read as follows: “This authorisation shall lapse if the
activity does not commence within two (2) years of the date
of this
judgment”.
5. The first respondent is to pay the costs of the
application, including the costs of two counsel.
HJ ERASMUS, J
I agree and it is so ordered.
MOTALA,
J
1
The
full text of the Appeal Decision is cited below in par [24].
2
2007
(10) BCLR 1059
(CC).
3
At
par [37].
4
Promotion
of Administrative Justice Act 3 of 2000
.
5
Bato Star Fishing (Pty) Ltd v
Minister of Environmental Affairs and Others
[2004] ZACC 15
;
2004 (4) SA 490
(CC) at par
[25]
.
6
De
Ville
Judicial Review of Administrative Action in South Africa
(2003) at 401; Currie and Klaaren
The
Promotion of Administrative Justice Benchbook
(2001) at par 7.2; Hoexter
Administrative
Law in South Africa
(2007) at 441.
7
Per
O’Regan J in
Ferreira
v Levin NO and Others; Vryenhoek and Others v Powell NO and Others
1996 (1) SA 984
(CC) at par [229]. In
Van
Huysteen NO v Minister of Environmental Affairs and Tourism
1996 (1) SA 283
(C) at 301 Farlam J (as he then was) said that “the
Constitution had adopted and entrenched a very liberalised notion of
legal
standing”.
8
1996
(1) SA 984
(CC) at par [165].
9
Hoexter
Administrative Law in South Africa
(2007) at 442.
10
1996
(1) SA 984
(CC) at par [161] to [168].
11
See
De Ville
Judicial
Review of Administrative Action in South Africa
(2003) at 403-404.
12
The
reference is to regulation 10 of the Regulations made under the ECA
and published in GN R 1183 in GG 8261 of 5
th
September 1997.
13
That
is, the ROD which is referred to in this judgment as the Second ROD.
14
P
ublished
in GN R 1183 in
GG
8261 of 5
th
September 1997.
15
“
Relevant
authority” is defined in Regulation 1 and includes a provincial
authority.
16
Hoexter
Administrative Law in South Africa
(2007) at 247.
17
2000
(1) SA 1
(CC) at par [44].
In
Matthew v Walmer Municipality and Another
1966 (4) SA 497
(E) the administrative decision in question was “at
no stage conveyed to the applicant” and therefore “inchoate”
(at 503D—G).
18
Associated
South African Bakeries (Pty) Ltd v Oryx & Vereinigte Bäkereien
(Pty) Ltd en Andere
1982 (3) SA 893
(A) at 924A;
Plascon
Evans Paints Ltd v Van Riebeeck Paints (Pty) Ltd
[1984] ZASCA 51
;
1984 (3) SA 623
(A) at 635C.
19
Matthew v Walmer Municipality
and Another
1966 (4) SA 497
(E) at 503G.
20
De
Ville
Judicial
Review of Administrative Action in South Africa
(2003) at 69;
Hoexter
Administrative
Law in South Africa
(2007) at 247—248 and the authorities cited by the learned author.
21
Fedsure
Life
Assurance
Ltd v Greater Johannesburg Transitional Metropolitan Council
[1998] ZACC 17
;
1999 (1) SA 374
(CC) at par
[58]
. See also
Minister
of Education v Harris
2001 (4) SA 1297
(CC) at par [9] to [13].
22
GN
R 1182 in
GG
18261 dated 5
th
September 1997.
23
2007
(10) BCLR 1059
(CC).
24
At
par [4].
25
At
par [79].
26
At
par [82].
27
The
reference is to the Town-Planning and Townships Ordinance 15 of 1986
(T).
28
At
par [71] and [72].
29
See
above par [35] and footnote 22.
30
Akani
Garden Route (Pty) Ltd v Pinnacle Point Casino (Pty) Ltd
2001 (4) SA 501
(SCA) at par [6] and [7].
31
[2000] ZACC 1
;
2000
(2) SA 674
(CC) at par
[85]
.
32
If
new facts had been placed before the first respondent, the
applicants would have had a right to counter them: see
Huisman
v Minster of Local Government, Housing and Works (House of Assembly)
[1995] ZASCA 151
;
1996 (1) SA 836
(SCA) at 845F.
33
See
par [2] above.
34
The
first respondent points out in the answering affidavit that her
portfolio also includes Development Planning.
35
Darson
Construction
(Pty) Ltd v City of Cape Town and Another
2007 (4) SA 488
(C) at 5012F--G. See also De Ville
Judicial
Review of Administrative Action in South Africa
(2003) at 355;
Hoexter
Administrative
Law in South Africa
(2007) at 503
.
36
Administrative
Law in South Africa
(2007) at 503.
37
See
Darson
Construction (Pty) L:td v City of Cape Town and Another
2007 (4) SA 488
(C) at 509G where Selikowitz J states that
“[d]amages are by their very nature unliquidated” and that it is
“the Court’s
task after the hearing of evidence to quantify
damages”.