Brief Summary

Administrative Law — Review of administrative action — Application for amendment of town planning scheme — First respondent's refusal to approve application based on late submission of local authority's comments — Local authority's comments deemed relevant despite being submitted after the deadline — Court held that the local authority's input must be considered in the decision-making process, and the first respondent's refusal to approve the application was set aside.

Comprehensive Summary

Summary of Judgment

Introduction

The matter concerned an application for the review and setting aside of an administrative decision taken by the Member of the Executive Council responsible for Local Government and Housing in the Free State (the first respondent). The impugned decision was the refusal to approve an application to amend provisions of the Bloemfontein Town Planning Scheme in respect of a specific property in Bloemfontein.

The applicants were (i) a town and regional planner (the first applicant) and (ii) three trustees (the second, third and fourth applicants) of The Michael Family Trust, the registered owner of Erf 17095, Bloemfontein (referred to in the evidence as the Shoprite Checkers property). The respondents were the MEC (first respondent), the chairperson of the relevant Townships Board established under provincial ordinance (second respondent), and Consouw BK (third respondent), the owner of the adjacent BMW dealership property. Only the first and third respondents opposed the review.

Procedurally, the planning application was launched under the Removal of Restrictions Act 84 of 1967, progressed through local authority notice and objection processes, and was investigated by the Townships Board which recommended approval subject to conditions. The MEC nonetheless refused approval on 22 July 2004. The trust requested reasons, and thereafter instituted review proceedings in terms of Uniform Rule of Court 53, on shortened time periods which were disputed by the respondents. Reasons were later furnished, and the review was ultimately argued and decided in March 2005.

The general subject matter was town-planning regulation and administrative-law review, specifically whether the MEC’s refusal of the scheme amendment was reviewable under the Promotion of Administrative Justice Act 3 of 2000 (PAJA) for want of rationality or reasonableness, and whether the applicants had properly made out a review case on their papers.

Material Facts

The undisputed background facts included that the trust owned Erf 17095, Bloemfontein, which had already been developed into a retail complex anchored by a supermarket and including a service station and other shops. The property was bounded by major streets and lay adjacent to Erf 28420, on which a BMW motor dealership (owned by the third respondent) operated.

In October 2003 an application was brought in terms of the Removal of Restrictions Act 84 of 1967 to amend the applicable town planning scheme provisions relating to the Shoprite Checkers property. The motivation for the amendment was that it was necessary to modernise the complex, add further shops closer to First Avenue, and make substantially more parking available, primarily by constructing a three-level parking garage above the existing complex (with roof parking on the top level). The applicants’ assertion that there was a significant shortage of parking at the site, exacerbated by the BMW site’s development, was not disputed.

The application formally sought, among other things, an amendment to the “Special Use I” purposes applicable to the property and alterations to scheme controls including coverage (from 29% to 80%), floor area, height (from 9m to 20m), and building lines. The application included an extract (pages 29–30) from a traffic impact study prepared for another development in the broader area (the “Waterfront” development), rather than a traffic impact study specifically directed at the proposed Shoprite Checkers expansion and parking garage.

Proper statutory notice of the application was given, and only the third respondent objected. An inspection in loco took place on 23 March 2004, and an inquiry before the Townships Board was postponed and continued on 16 April 2004 due to the third respondent’s counsel’s illness.

A letter from the Mangaung Local Municipality dated 29 March 2004 contained the municipality’s comments and recommendation that the application be approved subject to conditions, including (ix) that maximum height be restricted to 9 metres and (x) that coverage be restricted to 60%. The Townships Board recorded that these municipal comments were “not received” timeously and “must be ignored”, but nevertheless proceeded and recommended approval, subject to a condition replacing the requested height restriction of 20 metres with “ground level plus two floors/levels”, and subject to the municipality’s conditions. The court considered the Townships Board’s approach to ignoring the municipal letter (because late) to be mistaken on a proper reading of the statutory provision dealing with late municipal comment, although this was not decisive of the outcome.

On 22 July 2004 the MEC decided not to approve the application. Reasons were requested on 3 August 2004, and the review application was issued around 10 September 2004 as a Rule 53 review on truncated time periods. The MEC furnished written reasons on 22 October 2004. Despite suggestions from the State Attorney that the applicants consider amending their notice of motion and supplementing their founding affidavit (consistent with Rule 53 practice), the applicants did not supplement their founding affidavit after receiving the reasons and raised additional contentions only in reply.

Legal Issues

The central legal questions were whether the MEC’s refusal to approve the planning amendment was reviewable and liable to be set aside on the grounds advanced by the applicants, particularly that the decision was irrational or so unreasonable that no reasonable decision-maker could have made it, within the meaning of PAJA.

A further key issue was procedural and evidential in nature: whether the applicants had properly made out their review case in the founding affidavit, given established motion-proceedings principles that affidavits serve as both pleadings and evidence, and that an applicant generally must stand or fall by the founding papers.

The dispute therefore involved the application of administrative-law review standards to the facts, together with an assessment of whether the applicants’ pleaded grounds adequately engaged the PAJA thresholds, and whether new factual and legal contentions could permissibly be advanced for the first time in reply.

Court’s Reasoning

The court approached the matter from two main angles. First, it examined whether the applicants’ founding papers disclosed adequate review grounds. Secondly, it considered (in substance) whether, on the reasons later furnished, the MEC’s decision could be characterised as irrational or unreasonable under PAJA.

On the adequacy of the founding affidavit, the court reiterated established principles of motion proceedings: affidavits must contain the necessary allegations and evidence, and an applicant must ordinarily make out the case in the founding affidavit. The court emphasised that an applicant cannot put up only a skeleton case and seek to complete it in reply, subject only to limited exceptions permitted in the interests of justice where no prejudice would result. Against that framework, the court read the applicants’ stated review grounds as essentially asserting that the MEC’s decision was unreasonable because it departed from the Townships Board’s recommendation, coupled with speculative assertions that the MEC might have relied on other information to which the applicants had not been given an opportunity to respond.

The court held that these allegations did not constitute a sufficient review case. It reasoned that the mere fact that the MEC did not follow the Townships Board’s recommendation was not, without more, a ground of review because the MEC had the discretion to accept or reject the recommendation. The suggestion that the MEC may have relied on undisclosed information was treated as speculation rather than a substantiated ground. On this basis alone, the court considered that the application was liable to fail.

The court nonetheless proceeded to consider the MEC’s furnished reasons and whether, applying PAJA, the decision was objectively rational and within the bounds of reasonableness. It identified four substantial reasons underlying the refusal. The first concerned the height restriction. The MEC considered the height component of the application confusing and ambiguous, noting a lack of clarity between “floors” and “levels”, and pointing out the reference to municipal conditions (including the municipal recommendation of a 9-metre height restriction). The MEC further expressed concern that approval in the recommended form could result in a building exceeding both the adjacent BMW development and even the originally requested 20 metres, and that a height greater than 9 metres would have a negative visual impact.

The second substantial reason related to the requested coverage and the planning context. The MEC reasoned that internationally accepted urban development principles differentiate between high-density, high-rise central business districts (CBDs) and lower-density areas outside the CBD where stricter limitations are appropriate due to environmental and public-interest considerations and the need for a more “relaxing atmosphere”. Because the property was outside the CBD, the MEC was not prepared to approve the requested 80% coverage, and he also questioned whether a 12-metre building line along First Avenue would be feasible if such high coverage were permitted.

The third reason concerned traffic impacts. The MEC noted existing serious traffic congestion on surrounding streets and regarded the traffic impact issue as critical for such a large development. He considered it essential to have a traffic impact study specifically relating to the proposed development, and he was not willing to approve the application in the absence of such a targeted study. The court interpreted the refusal not as a factual finding that traffic would necessarily worsen, but as a principled insistence that proper, specific traffic assessment was necessary for an informed decision.

The fourth reason concerned public interest and spatial/economic planning. The MEC relied on the Free State Development Plan and the municipality’s Integrated Development Plan (IDP), indicating that these instruments sought the rejuvenation of inner-city areas and that the proposed development could entice “prestige” businesses out of the CBD, undermining efforts to strengthen the CBD and the impact of government’s relocation of offices into the CBD.

In evaluating these reasons under PAJA, the court applied the constitutional and administrative-law threshold of rationality and the statutory standard of reasonableness. It stressed that the court’s role on review is not to substitute its own opinion for that of the empowered functionary, but to ensure that the decision is within lawful bounds. On an objective assessment, the court concluded that each of the four reasons was intelligible and objectively acceptable, and that collectively they provided a rational connection between the material considered and the decision to refuse approval. It was therefore not shown that the decision was irrational under PAJA, nor that it was a decision that no reasonable decision-maker could have taken.

The court also addressed additional arguments raised for the first time in reply, including that the MEC should not have considered the municipal letter (said to be late), that the MEC relied on traffic congestion without giving the applicants an opportunity to respond, and that the MEC invoked international principles and development plans without sufficient specificity. Although these were raised late, the court dealt with them briefly and found them to lack merit on the papers. The municipal letter formed part of the documentation placed before the MEC and, in any event, it supported the application subject to conditions; the existence of traffic congestion was not denied, and the refusal was grounded in the absence of a development-specific traffic study; and the court found that the MEC had adequately identified the principles and planning instruments he considered.

Finally, the court recorded that, because the application failed on the merits, it was unnecessary to determine a preliminary objection raised by the third respondent that the first applicant lacked locus standi to bring the proceedings in his own name.

Outcome and Relief

The court dismissed the review application and refused to set aside the MEC’s decision of 22 July 2004 refusing approval of the scheme amendment application.

The applicants were ordered to pay costs, including the costs of two counsel where applicable, and including the costs occasioned by the matter being set down on 4 November 2004.

Cases Cited

Titty’s Bar and Bottle Store (Pty) Ltd v A.B.C. Garage (Pty) Ltd and Others 1974 (4) SA 362 (T).

Director of Hospital Services v Mistry 1979 (1) SA 626 (A).

Shepherd v Mitchell Cotts Seafreight (SA) (Pty) Ltd 1984 (3) SA 202 (T).

Academy of Learning (Pty) Ltd v Hancock and Others 2001 (1) SA 941 (K).

Ferreira v Premier, Free State, and Others 2000 (1) SA 241 (O).

Pharmaceutical Manufacturers Association of SA and Another: In re Ex parte President of the Republic of South Africa and Others 2000 (2) SA 674 (CC).

Trinity Broadcasting (Ciskei) v Independent Communications Authority of South Africa 2004 (3) SA 346 (SCA).

Bato Star Fishing (Pty) Ltd v Minister of Environmental Affairs and Others [2004] ZACC 15; 2004 (4) SA 490 (CC).

Legislation Cited

Promotion of Administrative Justice Act 3 of 2000.

Removal of Restrictions Act 84 of 1967.

Free State Ordinance on Towns 9 of 1969.

Development Facilitation Act 67 of 1995.

Rules of Court Cited

Uniform Rule of Court 53.

Held

The court held that the applicants’ founding affidavit did not properly establish review grounds, because it largely amounted to an assertion that the MEC should have followed the Townships Board’s recommendation and speculative claims about undisclosed information.

The court further held that, in any event, the MEC’s refusal was supported by four substantial reasons relating to ambiguity and visual impact in relation to building height, inappropriateness of the requested coverage outside the CBD context, the absence of a development-specific traffic impact study in circumstances of existing congestion, and public-interest planning objectives aimed at strengthening the CBD. These reasons meant the decision was neither objectively irrational nor so unreasonable that no reasonable decision-maker could have made it under PAJA.

The review was dismissed with costs, including (where applicable) the costs of two counsel and the wasted costs associated with the hearing date of 4 November 2004.

LEGAL PRINCIPLES

A party seeking final relief in motion proceedings must make out the case in the founding affidavit, because affidavits serve as both pleadings and evidence. As a general rule, an applicant cannot establish only a framework in founding papers and attempt to complete the case in reply; departures from this principle are exceptional and turn on considerations of justice and absence of prejudice.

In administrative-law review, the applicable threshold for interfering with executive or administrative action includes rationality as a minimum requirement for the lawful exercise of public power. A reviewing court does not substitute its opinion for that of the authorised decision-maker merely because it disagrees with the outcome; the focus is whether there is, objectively viewed, a rational connection between the material considered and the conclusion reached.

Under PAJA, administrative action may be reviewed if it is not rationally connected to the information before the decision-maker (as contemplated by section 6(2)(f)(ii)) or if it is so unreasonable that no reasonable person could have exercised the power in that manner (section 6(2)(h)). What constitutes reasonableness depends on the circumstances, including the nature of the decision, the decision-maker’s expertise, relevant considerations, reasons given, competing interests, and the impact of the decision, while maintaining the distinction between review and appeal.

De Leeuw and Others v MEC for Local Government and Housing Free State and Others (3099/2004) [2005] ZAFSHC 4 (10 March 2005)