Old Mutual Properties (Pty) Ltd and Another v Avalon Group (Pty) Limited and Others (21/CAC/Jul02) [2003] ZACAC 3; [2003] 1 CPLR 46 (CAC) (24 April 2003)

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[2003] ZACAC 3
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Old Mutual Properties (Pty) Ltd and Another v Avalon Group (Pty) Limited and Others (21/CAC/Jul02) [2003] ZACAC 3; [2003] 1 CPLR 46 (CAC) (24 April 2003)

IN THE
COMPETITION APPEAL COURT OF SOUTH AFRICA
Case No: 21/CAC/JUL02
In
the matter between:
OLD
MUTUAL PROPERTIES (PTY) LIMITED
First Applicant
OLD
MUTUAL LIFE ASSURANCE COMPANY
(SOUTH
AFRICA) LIMITED
Second Applicant
and
THE
COMPETITION TRIBUNAL
First Respondent
NORMAN
MANOIM N.O.
Second Respondent
AVALON
GROUP (PTY) LIMITED
Third Respondent
VIDEOVISION
ENTERTAINMENT (PTY) LIMITED
Fourth Respondent
PRIMEDIA
LIMITED
Fifth Respondent
STER-KINEKOR
FILMS (PTY) LIMITED
Sixth Respondent
Judgment
Malan
J
:
[1] This is an application for the review and setting aside of two
decisions taken by the Second Respondent (“the Assigned Member”),
allegedly on behalf of the First Respondent (“the Tribunal”), at
or pursuant to a pre-hearing conference held on 24 June 2002.
[2] The first decision, and the order made by the
Assigned Member as a result, related to the discovery of a lease
between the Second
Applicant and the Sixth Respondent and entailed an
order that the Applicants are obliged to discover in terms of rule
22(1)(c)(v)
the lease agreement concluded by the First Applicant and
the Sixth Applicant on 14 November 2001.
The second decision involved the refusal by the Assigned
Member to set down certain points of law for hearing by the Tribunal
and
to adjourn proceedings pending resolution of those questions (in
terms of Rule 21(2)(a)). The second decision itself involved three
separate decisions, i.e. a separate decision not to refer each of the
three alleged questions of law for separate hearing.
[3] The applicants contend that the aforesaid decisions
of the Assigned Member were materially influenced by a mistaken
understanding
of the Tribunal’s jurisdiction; and that both
decisions were not rationally supported by the reasons given for them
and evidenced
a failure by the Presiding Member properly to apply his
mind; and that the second decision falls to be set aside as a result
of the
Presiding Member’s incorrect view of the nature of his
discretion and the fact that he has committed the Tribunal to a
procedure
that is procedurally unfair to the applicants herein and
contrary to the rule of law.
[4] The proceedings were initially opposed by both the
Third and Fourth Respondents. In its answering affidavit the Third
Respondent
raised as a point
in limine
the question whether
this Court had jurisdiction to hear this application for review. The
following contentions were advanced to
which I will again refer:
based on the premise that this Court is not only established by the
Competition Act 89 of 1998
but also derives its powers from the Act,
this Court lacks jurisdiction in terms of
ss 37
and
61
to review the
decisions of the Assigned Member. His decisions are not decisions of
the Tribunal and
s 37(1)(a)
limits the Court powers of review to
decisions of the Tribunal.
[5] Since the filing of affidavits in this matter the Fourth
Respondent has withdrawn its complaint against the Applicants and the
Applicants have, in consequence, withdrawn their application in so
far as it lies against the Fourth Respondent. This means that
the
second of the questions of law set out in the Applicants’ notice in
terms of
rule 21(2)
has effectively been withdrawn. The applicants
have also given notice in paragraph 57 of their heads of argument
that they will not
be pursuing the review against the Second
Respondent’s decision not to direct the Registrar to set down for
separate hearing the
third question of law.
This means that the issues to be dealt with in this
matter are (1) the jurisdictional point
in limine
; (2) whether
the decision of the Second Respondent to order discovery of the
November 2001 lease falls to be reviewed and set aside;
and (3)
whether the Second Respondent’s decision not to refer the first of
the points of law for separate hearing falls to be reviewed
and set
aside. It is clear that a decision in favour of the Respondents on
the first question, i.e. the point
in limine
dispose of the
matter altogether.
[6] At the hearing on 28 March 2003 we gave an order
that the point in limine be upheld and that the appeal be dismissed
with costs
including the costs of two counsel. Reasons for the order
were to follow. The reasons are set out hereunder.
[7] The Competition Appeal Court is a court contemplated in s 166(e)
of the Constitution with a status similar to that of a High
Court (s
36(1)(a). It has exclusive and final jurisdiction in respect of
certain specified matters (s 62(1) and (3) and see
Seagram Africa
Ltd v Stellenbosch Farmers’ Winery Group Ltd and others
2001 2
SA 1129
(C) 1141F-1142I). However, it remains a “creature of
statute and derives its powers, obligations and jurisdiction from the
four
corners of the statute” (compare
Venter v Compensation
Commissioner
2001 4 SA 753
(T) 757CF). Its powers are set out in
s 37 of which subs (1) provides that it
may
–
review any
decision of the Competition Tribunal; or
consider an appeal
arising from the Competition tribunal in respect of –
any of its final
decisions, other than a consent order made in terms of section 63;
or
any of its interim
or interlocutory decisions that may, in terms of this Act, be taken
on an appeal.
Section
37(2) provides that the Competition Appeal Court “may give any
judgment or make any order, including an order to –
confirm, amend or
set aside a decision or order of the Competition Tribunal; or
remit a matter to
the Competition Tribunal for a further hearing on any appropriate
terms.
[8] It is clear that the powers of review and appeal
given by this section are limited to reviews of or appeals against
decisions
of the
Competition Tribunal
. The Act does not allow
for any uncertainty and expressly refers to the Tribunal’s
decisions, not the decisions of any other functionary
under the Act
(see also s 61(1)). Proceedings of the Competition Tribunal are
chaired by the Chairperson who is responsible to manage
the case load
of the Tribunal. He must assign each matter referred to the Tribunal
to a panel composed of any three members of the
Tribunal (s 31(1)).
A decision of “the Chairperson or other person contemplated in
subsection (5), or of a majority of the members
of a panel in any
other matter, is the decision of the panel” (s 31(6)). Section
31(5) provides for two special cases: “If the
Competition Tribunal
may extend or reduce a prescribed period in terms of this Act, the
Chairperson of the Tribunal or another member
of the Tribunal
assigned by the Chairperson, sitting alone, may make an order – (a)
extending or reducing that period; or (b) condoning
late performance
of an act that is subject to that period.” The decision of an
Assigned Member pursuant to s 31(5) is a decision
of the Tribunal (s
31(6)).
No other provision is made to equate the decisions of
Assigned Members to decisions of the Tribunal. Compare also rule
3(4)(kk) of
the Competition Tribunal Rules which defines “tribunal”
as either (a) the body established by s 26; (b) a panel of the
Tribunal
convened under s 31(1); a member of the Tribunal sitting in
terms of s 31(5); or the Registrar of the Tribunal. An Assigned
Member
has limited powers only. These powers derive from the
Competition tribunal Rules and relate to pre-trial hearings in order
to effectively
manage matters before the Tribunal. For example, the
Assigned Member may direct the Registrar to set a point of law down
for hearing
by the Tribunal (rule 21(2)). All the other powers given
an Assigned Member by rule 22 concern matters of procedure and allow
him
or her to give directions to facilitate the hearing of a matter
by the Tribunal. The “pre-hearing conferences” need not follow
formal rules of procedure and may be conducted in person or by
telephone or in both ways (rule 21(4)). They are not open to the
public
(rule 21(4)). It is nowhere in the rules suggested that the
decisions of an Assigned Member are decisions of the Competition
Tribunal
(except as provided for in s 31(6)). Assigned Members may
play a role in pre-hearing merger proceedings (rules 35(3) and (4))
and
they have been given certain powers relating to the joinder and
substitution of parties (rule 45) and intervention (rule 46). They
may also give directions as to the conduct of hearings (rule 55).
The legislature has in terms of s 37(1)(b) expressly
limited the Competition Appeal Court’s power to hear appeals
against decisions
of the Tribunal to final decisions of the Tribunal
and to such interim or interlocutory decisions that may be taken on
appeal (s
37(1)(b). There is nothing in the Act to indicate that the
legislature intended to allow unlimited interlocutory reviews. The
only
provision in the Act allowing an appeal against an interim or
interlocutory decision is s 49C(7) which provides for an appeal
against
the refusal by the Tribunal to grant interim relief in terms
of s 49C. Should a procedural decision of an Assigned Member be
prejudicial
to one or more of the parties it could be remedied by the
Tribunal in terms of rule 42 (read with ss 55 and 27(1)(d) and
compare
the remarks by Jali J in
Seagram Africa (Pty) Ltd v
Stellenbosch farmers’ Winery group Ltd and Others
2001 2 SA
1129
(C) 1140J-1141B).
[9] In
support of their contention that this Court had the power to review
the decisions of the Second Respondent complained of, counsel
for the
Applicants relied on the decision of this Court in
Anglo South
Africa (Pty) Ltd and Others v The Industrial Development Corporation
of South Africa Ltd and Others
(24&25/CAC/Nov02) that was
delivered on 15 November 2002 by Davis JP, with Jali JA and
Selikowitz JA concurring. It was held,
first, that the power of a
single member of the Tribunal in terms of rule 42 to allow a party to
intervene was
ultra vires
the provisions of s 53(1)(c)(v) which
authorises the Tribunal, and not any single member of the Tribunal,
to recognise a person as
a participant. Secondly, the Court held that
the decision of the single member to appoint an expert was
unacceptably wide. Davis
JP said at pages 4-5:
“
Rule
46(2) cannot supplant the provisions of the Act; hence when an Act
does not empower a single member of the tribunal, who may
not be a
member of the designated panel, to make these kind of determinations,
the Rule itself cannot then empower the single member
to do that
which is not expressly or by necessary implication provided in terms
of the Act.
On this basis, the three related determinations, being
the intervention decision, the determination as to scope, and the
decision
as to confidential information, were made by second
respondent in circumstances which are
ultra vires
the Act. In
short, there is nothing in the Act which empowered second respondent
to make these determinations and they must therefore
stand to be
declared invalid.”
Davis JP said with regard to the second issue at page
5-6:
“
The
wording of this particular ruling purports, in effect, to supplant
third respondent’s own decision-making powers and to abrogate
its
own powers to an expert. An expert, in this case seventh respondent,
in being asked to make a determination of the kind which
the Act
mandates third respondent to so make.”
“
In
these circumstances the ruling is unacceptably wide by reason of the
scope of the instructions given to seventh respondent. This
conclusion provides a second basis for the finding that the ruling
must be set aside. “
It should be noted that the review jurisdiction of this
Court was never raised nor argued in the
Anglo
. The parties
seem to have assumed that the Court had such jurisdiction. The Court
did not consider the matter nor made any finding
in respect of its
review jurisdiction. In these circumstances the matter is open to
this Court to consider the issue.
For
the reasons set out above the following order was made:
The
point in limine is upheld;
The
appeal is dismissed with costs including the costs of two counsel.
_______
Malan
J
Acting
Judge of the Competition Appeal Court
Hussain JA and Jali
JA concurred.
Counsel for
Applicants: RO Petersen SC and PBJ Farlam
Attorneys
for Applicants: Walkers Inc
Counsel
for Third Respondent: CJ Pammenter SC and OA Moosa
Attorneys
for Third Respondent: JH Nicholson Stiller & Geshen Attorneys