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[2024] ZANCHC 39
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Desert Palace Hotel Resort (Pty) Ltd v Northern Cape Gambling Board and Others (11/2023) [2024] ZANCHC 39 (26 April 2024)
SAFLII
Note:
Certain
personal/private details of parties or witnesses have been
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Policy
IN THE HIGH COURT OF
SOUTH AFRICA
(NORTHERN CAPE
DIVISION, KIMBERLEY)
Case No: 11/2023
Heard: 29 January 2024
Judgment delivered:
26
April 2024
Reportable: YES /
NO
Circulate to Judges: YES
/
NO
Circulate to Regional
Magistrates: YES /
NO
Circulate to Magistrates:
YES /
NO
In the matter between:-
DESERT PALACE HOTEL
RESORT (PTY) LTD
APPLICANT
and
THE NORTHERN CAPE
GAMBLING BOARD
FIRST RESPONDENT
DYMACURE (PTY) LTD T/A
CRAZY SLOTS (PTY) LTD
NORTHERN
CAPE
SECOND
RESPONDENT
GOODFELLAS
RESTAURANT
THIRD RESPONDENT
CORAM:
WILLIAMS J ET STANTON J
JUDGMENT
Stanton J:
INTRODUCTION
:
-
[1]
In this review application
the applicant seeks that: -
1.1
The following decisions of the first
respondent, the Northern Cape Gambling Board
(“the
Gambling Board”)
be set aside:
-
1.1.1
The decision to grant a gambling licence
to the second respondent, Dymacure (Pty) Ltd (Pty) Ltd trading as
Crazy Slots Northern
Cape (“Crazy Slots”) to provide
limited pay-out machines for play at the premises situated at Erf
3[...], Shop No.
1, [...] C[...] Street, Upington (“the
gambling premises”); and
1.1.2
The decision to issue a gambling licence
to Crazy Slots to provide for limited pay-out machines for play at
the premises;
(“
the
decisions
”)
1.2
The decisions be set aside and referred
back to the Gambling Board for reconsideration; and
1.3
The Gambling Board be ordered to pay the
costs of the application, alternatively that Crazy Slots and the
third respondent, Goodfellas
Restaurant
(“Goodfellas”)
be ordered to pay the costs of the application together with the
Gambling Board in the event of them opposing the application.
[2]
No relief is sought against Goodfellas and it was only cited for any
interest
it may have in the application.
[3]
The applicant’s grounds for review are: -
3.1
The
licence was
issued in contravention of Regulation 7(c) of the Northern Cape
Gambling Regulations 2010
(“the
Regulations”)
;
3.2
The presumption in section 5(3) of the
Promotion
of Administrative Justice Act, Act 3 of 2000
(“PAJA”
)
was triggered as the decisions were taken without good reason in that
the Gambling Board failed to give reasons upon request;
3.3
The Gambling Board did not ponder the relevant considerations, but
took irrelevant
and unsubstantiated information into consideration,
which resulted in the decisions being taken arbitrarily and
capriciously and
not being rationally connected to the purpose of the
Northern Cape Gambling Act 2008 (“t
he Act”
) and
the Regulations; and
3.4
The Gambling Board was biased against the applicant.
[4]
The essence of the applicant’s case is that the Gambling Board
incorrectly
accepted that the gambling premises is situated more than
500 meters away from the Upington High School
(“the school”)
due to the fact that the Gambling Board did not measure the distance,
and if it did, that it was measured with an incorrect method
and from
incorrect positions.
[5]
It is common cause between the
parties that in terms of Regulation 7(c) the Gambling Board does not
have a discretion to grant any
gambling licence
if
the premises from which the licenced activities will take place are,
in the opinion of the Gambling Board, within 500 metres
of a school
or a place of worship.
[6]
According to the applicant: -
6.1
The school, as measured by Mr HG van Zyl, a qualified and registered
land surveyor
is situated: -
6.1.1
341,56 meters, as the crow flies, between the closest points of the
borders of the school and
the gambling premises, the border being the
border of the land on which the buildings are situated; or
6.1.2
461,75 meters as a person would walk by road between the closest
points between the school and
the gambling premises;
6.2
The Gambling Board did not consider the relevant consideration that
the premises
is situated within 500 meters of the school and took
irrelevant and unsubstantiated information placed before them at the
public
enquiry, namely:-
6.2.1
The site inspection report compiled by Mr Sekamoeng on 10
March 2020
(“the site inspection report”)
;
6.2.2
The report to the Gambling Board, dated 19 April 2022 (“
the
report”)
; and
6.2.3
The licencing and compliance committee’s recommendations to the
Gambling Board, dated
23 May 2022
(“the recommendations”);
6.3
The Gambling Board was biased towards the applicant as a decision was
initially
taken without a public hearing as required by the Act, and
when the public hearing was later held at the urging of the
applicant,
the Gambling Board had no interest in genuinely addressing
the issue of the distance from the school, elected not to summon any
person to testify in regard to the distance, required no evidence of
the actual distance and ignored the information of Mr Van
Zyl placed
before them. Furthermore, the Gambling Board emphasised that
the applicant is objecting to the application as
it merely wishes to
eliminate competition; and
6.4
As a result of the above, the decisions were taken arbitrarily and
capriciously
and were not rationally connected to the purpose of the
Act and Regulations or the information tendered to the Gambling
Board.
[7]
Subsequent to the filing of the incomplete record, in respect of
which
the applicant decided not to file an application to compel, the
applicant filed a supplementary affidavit in which the following
additional averments are made:-
7.1
The site inspection report states that gambling operations will have
no impact
on the surrounding area, churches and schools. According
to the report, Mr Sekamoeng did not specify having taken any
measurements
whether there are any churches or schools within 500
meters of the premises or that the premises complies with Regulation
7(c);
7.2
On 19 April 2022, the Acting Manager: Licencing and Investigation, in
a letter
addressed to the Gambling Board, stated that: “
Site
inspection was conducted on the site (see attached site inspection
report) and the following findings were made
There was no school or
church found within 500 m of the site.”;
7.3
According to the minutes of the public hearing conducted on 21 April
2022
(“the minutes”
):-
7.3.1
The measurements taken by Mr Van Zyl were handed in together with his
curriculum vitae
and his registration certificate;
7.3.2
Crazy Slots handed in certain documents purporting to reflect two
measurements, without the
name or qualification of the person who
took the measurement and without an explanation from where to where
the two measurements
were taken;
7.3.3
Mr Sekamoeng was present at the meeting and merely confirmed what is
contained in site inspection
report, without explaining that he
measured the distance; and
7.4
Whilst the recommendations reflect that discussions took place
pertaining to the agreed
method and tools to take measurements, there
is no confirmation to state that Mr Sekamoeng did in fact measure the
distance.
[8]
The Gambling Board opposed the application and on 05 April 2023 filed
an answering affidavit, deposed to by Mr VG Mothibe, its Chief
Executive Officer. The Gambling Board’s grounds for
opposing the application are that:
8.1
The Gambling Board did not contravene Regulation 7(c) as it measured
the distance
between the school and the premises with a measuring
wheel and found it not to be within 500 meters of each other;
8.2
The measurements done by Mr Van Zyl were not done correctly as the
Act does
not require that the radius method should be used;
8.3
The measurements done by Mr Van Zyl were not done correctly as the
Gambling
Board uses a SABS measuring wheel measuring from the entry
point of the proposed gambling site to the entry point of the church
or school; and
8.4
The decision to grant and issue the licence was reasonable,
justifiable and
procedurally fair.
[9]
Crazy Slots opposed the application on the basis that: -
9.1
The applicant filed the review application solely to prevent
competition and
to protect its own financial interests;
9.2
According to its own measurements, done by Mr A Pule, Crazy Slots’s
provincial
general manager, using a measuring wheel from the main
entrance of the school and from the corner boundary fence of the
school
to the gambling premises, the distance between the school and
the gambling premises exceeds 500 meters;
9.3
The Gambling Board took relevant factors into consideration when it
relied on
the site inspection report and cannot be criticised for
relying on the wheel as a measuring tool; and
9.4
The boundaries of the properties on which the premises are situated
should not
be used as the points to measure from, but on a proper
interpretation of Regulation 7(c), taking a sensible business-like
approach
and the purpose of the legislation into consideration, the
distance should be measured from the main entrance of the school to
the main entrance of the Goodfellas Restaurant.
CRAZY
SLOTS’S POINT
IN LIMINE
: -
[10]
Crazy Slots also raised a point
in limine
that the requested
relief cannot be granted as the licence was awarded to Goodfellas and
not to Crazy Slots, and as such the relief
should have been requested
against Goodfellas. In support of its contention, it relies on the
following: -
10.1
The applicant stated in its objection dated 15 April 2020 that it
objects to the site application
at “
Erf 3[...], Shop number
1 “Good Fellas Restaurant” Upington for Limited payout
machines by Site owner Johan Ming Hui
Lu.”;
10.2
The advertisement in the Government Gazette indicates that Goodfellas
is the applicant for the
licence;
10.3
In the application for the licence, the business owner of Goodfellas
is described as Johan Ming
Hui Lu;
10.4
The applicant, in its correspondence dated 16 February 2022, objected
to the application at the
premises for “
Good Fellas
Restaurant”
.
[11]
The fallacy of Crazy Slots’s argument is: -
11.1
The report states that in January 2020 the Gambling Board received an
application from Crazy
Slots
on behalf of Good Fellas Restaurant
;
11.2
In its answering affidavit, the Gambling Board explained that the
“
Second Respondent applied “
for and on
behalf of the Third Respondent
for a Site Operator
Licence.”
;
11.3
The minutes provide that a site application was received from Crazy
Slots
on behalf of Good Fellas
and it records that Mr A Pule
of Crazy Slots attended the meeting as the
applicant for the
licence
;
11.4
In its answering affidavit, the Gambling Board admits that Crazy
Slots applied for the gambling
licence to be issued at the gambling
premises;
11.5
The recommendations state that the Gambling Board received an
application from Crazy Slots
on behalf of Good Fellas Restaurant
;
and
11.6
The Site Operators License Application was submitted by Crazy Slots.
(my
emphasis)
[12]
In my view, the license was therefore granted to Crazy Slots on
behalf of Goodfellas.
The point
in limine
is
unmeritorious and stands to be dismissed.
THE
APPLICATIONS TO STRIKE OUT: -
[13]
The Gambling Board did not attach an affidavit by Mr Sekamoeng to its
answering papers.
[14]
On 15 August 2023, the applicant filed an application to strike all
paragraphs in
Mr Mothibe’s answering affidavit that make
reference to the measurement done by Mr Sekamoeng on the basis that,
in the absence
of a confirmatory affidavit by Mr Sekamoeng, it
constitutes inadmissible hearsay evidence. In the alternative,
the applicant
requested that the matter be referred to oral evidence
to enable Mr Sekamoeng to give evidence as to whether he had measured
the
distance between the gambling premises and the school, and if so,
what that distance was, which method he had used, the points from
which the measurements were done and whether it was done on the
correct route (“
the striking out application
”).
It is apposite to remark that no reference is made in Mr
Mothibe’s answering affidavit to Mr Sekamoeng being
the
employee who took the measurements, but rather that an “
inspector”
had attended to same.
[15]
The Gambling Board only filed a notice of intention to oppose the
striking out application,
but did not file an answering affidavit.
Crazy Slots, however, did, and whilst admitting that Mr
Mothibe’s evidence
amounts to hearsay, it submitted that the
Gambling Board made its decision to award the licence on information
placed before it,
including the site inspection report and the
recommendations made therein and that the striking out application
should be dismissed.
Mr
Sekamoeng’s confirmatory affidavit:-
[16]
On 22 January 2024, the Gambling Board filed a confirmatory affidavit
deposed to
by Mr Sekamoeng in which he merely states that he had
perused Mr Mothibe’s founding affidavit and that he confirms
the contents
thereof in so far as it pertains to him. He thus
failed to confirm that he had measured the distance between the
gambling
premises and the school, what that distance was, which
method he had used, the points from which the measurements were done
and
whether it was done on the correct route.
[17]
Mr ES Grobbelaar, on behalf of the applicant, argued that, in the
absence of an application
requesting condonation for the late-filing
of the confirmatory affidavit, same should be struck out. Mr WJ
Coetzee SC, on
behalf of the Gambling Board, confirmed that he holds
no instructions pertaining to the filing of the confirmatory
affidavit or
the striking out application. Mr M Smith, on
behalf of Crazy Slots, submitted that the striking out application is
of no
consequence seeing that the Gambling Board had taken the
decision based on the site inspection report and the recommendations
made
therein.
[18]
In the absence of a condonation application explaining the reason for
the lateness
and demonstrating good cause, Mr Sekamoeng’s
confirmatory affidavit was struck out.
Mr
Mothibe’s founding affidavit: -
[19]
Section 3(1)(c) of the Law of Evidence Amendment Act, Act 45
of 1998 (“the LEAA”) provides: -
“
Subject
to the provisions of any other law, hearsay evidence shall not be
admitted as evidence at criminal or civil proceedings,
unless
(a)
...
(b)
...
(c)
the court, having regard to –
(i)
the nature of the proceedings;
(ii)
the nature of the evidence;
(iii)
the purpose for which the evidence is tendered;
(iv)
the probative value of the evidence;
(v)
the reason why the evidence is not given by the person upon whose
credibility
the probative value of such evidence depends;
(vi)
any prejudice to a party which the admission of such evidence might
entail;
and
(vii)
any other factor which should in the opinion of the court be taken
into account,
is of the opinion that such evidence should be admitted
in the interests of justice."
[20]
It
is trite that a Court should have regard to the collective and
interrelated effect of all the considerations in paragraphs (i)
to
(iv) of section 3(1)(c) and any other factor that should, in the
opinion of the Court, be taken into account. The section
introduces a high degree of flexibility to the admission of hearsay
evidence with the ultimate goal of doing what the interests
of
justice require.
[1]
[21]
I agree with Mr Grobbelaar that the probative value of the evidence
that the distance
was measured by Mr Sekamoeng, how he measured it,
from what points the measurement was taken, along which route he
measured and
what he found the distance to be, depends on the
credibility of Mr Sekamoeng and not Mr Mothibe. In the absence
of any application
that the hearsay evidence should be admitted,
addressing the factors set out in section 3(1)(c) of the
LEEA,
t
he evidence sought to be struck out is
therefore inadmissible hearsay evidence; and the
application
to strike out is granted.
[22]
In view of the successful striking out application, it is unnecessary
to deal with
the applicant’s alternative request that the
matter should be referred for oral evidence with regard to the
measurement of
the distance.
WAS
REGULATION 7(c) CONTRAVENED?
[23]
The application therefore stands to be determined on the remaining
allegations contained
in the answering affidavit and the content of
the site inspection report, the report and the recommendations.
[24]
The Gambling Board’s allegation that Regulation 7(c) was
complied with is,
however, not bolstered by the following: -
24.1
The site inspection that curiously refers to the gambling premises as
“
Cnr Brug & Street, Hop 1, Upington”
and not
to the gambling premises; and that records that: -
“
4x.
Impact on surrounding area, churches and Schools
None”
;
24.2
The report, which in part reads: -
“
Site
inspection was conducted at the site (see attached site inspection
report) and the following findings were made
-
There was no school or church found
within 500m from the site.”
24.3
In the final instance, the recommendation that states: -
“
Site
inspection was conducted on the site (see attached site Inspection
report) and the following findings were made
-
There was no school or church found
within 500m from the site and the site was found to be compliant in
terms of regulation 7c”
[25]
In view of the fact that the site inspection report refers to a
different premises
and does not contain any evidence that
the
distance was measured by Mr Sekamoeng, how he had measured it, from
what points the measurement was taken, along which route
he had
measured and what the distance was determined to be, I can come to no
other conclusion than that the Gambling Board did
not measure the
distance between the school and the gambling premises. On this
basis alone, the application succeeds.
[26]
In view of my finding above I am also persuaded that the
Gambling Board ignored relevant factors, but took irrelevant factors
into
consideration.
SECTION
5(3) OF PAJA: -
[27]
As I have already concluded that the decisions fall to be set aside,
it is unnecessary
to make a determination as regards the
applicability of the provisions of section 5(3) of PAJA.
CONCLUSION:
-
[28]
The applicant is, in my view, entitled to the relief it seeks.
Accordingly,
the review must succeed and the decisions taken be
declared unlawful; and set aside.
[29]
As a general rule, a court will not substitute its own decision for
that of the public
authority, but will refer the matter back for a
fresh decision. One must guard against an unwarranted
usurpation of the powers
entrusted to the public authority by the
legislature.
[2]
[30]
The parties furthermore agreed that, if the applicant is successful,
it would be
just and equitable to remit the matter back to the
Gambling Board, with or without direction.
COSTS:
-
[31]
There is no reason why costs should not follow suit, and no arguments
to the contrary
were made.
ORDER:
-
In
the result, the following order is made: -
1.
The decision of the Northern Cape
Gambling Board to grant a gambling licence to the second respondent
to provide limited pay-out
machines for play at the premises situated
at Erf 3[...], Shop No. 1, [...] C[...] Street, Upington, is reviewed
and set aside;
2.
The decision of the Northern Cape
Gambling Board to issue a gambling licence to the second respondent
to provide for limited pay-out
machines for play at the premises
situated at Erf 3[...], Shop No. 1, [...] C[...] Street, Upington, is
reviewed and set aside;
3.
The matter is referred back to
the Northern Cape Gambling Board
to
deal with in accordance with all applicable statutory and other
requirements; and
4.
The first and second respondents are ordered to
pay the costs of the application, jointly and severally, the one
paying, the other
to be absolved.
STANTON
J
I
concur
WILLIAMS
J
Obo
the Applicant:
Adv
E.S. Grobbelaar
On
instruction of:
Morkel
de Villiers c/o Engelsman Magabane Inc.
Obo
the First Respondent:
Adv.
W.J. Coetzee SC
On
instruction of:
The
State Attorney
Obo
the Second Respondent:
Adv.
M. Smit
On
instruction of:
Cliffe
Dekker Hofmeyr Inc. c/o Van de Wall Inc.
[1]
Giesecke & Devrient Southern Africa (Pty) Ltd v Minister of
Safety and Security
[2012] 2 All SA 56
(SCA) para 31.
[2]
Bato
Star fishing (Pty) Ltd v Minister of Environmental Affairs and
Tourism and others
[2004]
ZACC 15
;
2004
(4) SA 490
(CC)
514G-B (2004(7) BCLR 687 (CC).