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IN THE COMPETITION APPEAL COURT OF SOUTH AFRICA
(WESTERN CAPE HIGH COURT, CAPE TOWN)
CASE NUMBER : 93/CAC/MAR10
DATE : 11 NOVEMBER 2011
In the matter between:
COMPETITION COMMISSION OF SOUTH AFRICA Appellant
and
YARA SOUTH AFRICA (PTY) LTD
OMNIA FERTILIZER LTD Respondents
J U D G M E N T
DAVIS, JP :
This court delivered a judgment in this matter on 14 March
2011 which prompted an application for leave to appeal by the
appellant, which was set down for hearing on 5 December
2011. On 27 September 2011 the Registrar of this Court was
informed by way of a letter from appellant’s attorney that the
appellant had lodged an application for leave to appeal to the
Constitutional Court. The letter then continued:
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“Our client’s application to the Constitutional Court
is premised on the basis that should the
Constitutional Court dismiss its application, it will
proceed to have its application for leave to appeal
heard before the CAC.”
As a result thereof, appellant’s attorney wrote further:
“Our client is of the view that it is unlikely that the
Constitutional Court will hand down its judgment
before 5 December 2011, the date on which our
application for leave to appeal at the CAC is set
down… Our client requests the CAC to postpone
the Commission’s application for leave to appeal to
the SCA pending the finalisation of the
Constitutional Court’s application.”
Upon receipt, this seemed to be a sensible approach,
particularly in that the only information available to this Court
as to the pending proceedings before the Constitutional Court
were contained in the letter to which I have made reference.
On 28 October 2011, however, the respondent’s attorney also
wrote to the court. In this letter respondent’s attorney said:
“We wish to record that to record that at no stage
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prior to the CAC issuing the directive, was any
correspondence received by Norton Rose SA
relating to the request for postponement nor was
any view on the possible consequence of
postponement solicited from the other party to these
matters by the CAC registry.”
The letter suggested that as respondent had briefed both
senior and junior counsel in the matter, that they had
commenced preparation for the 5 December hearing, there was
prejudice in the form of wasted costs if the appellant’s
application postponement was granted. The letter then
contains a series of submissions with regard to why the
approach adopted by the appellant is legally unjustifiable and
that it would, therefore, be premature to postpone the hearing
of 5 December.
Mr Farlam , who appeared on behalf of respondent in this
morning’s interlocutory hearing, which was called as a result of
these conflicting letters to which I have made reference,
contended, along the lines of the letter of respondent’s
attorney, that whatever the appellant’s rights to appeal in this
matter, there was a procedure to be followed which, in terms of
section 63(2) of the Competition Act 89 of 1998, required a
party seeking leave from a judgment of the CAC to approach
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the court before seeking leave to appeal to the Constitutional
Court.
In his view, the approach which the respondent had adopted to
appeal to the Constitutional Court, inter alia , required
appellant to follow the provisions of section 63(2).
Accordingly, respondent wished to inform the Constitutional
Court of the hearing on 5 December and request that the
Constitutional Court refer the matter to the Competition Appeal
Court for the hearing which had been set down. In other
words, as I understand the argument, the Constitutional Court
would be requested to refer the matter back to this court for
hearing on 5 December.
The problem in this case has been caused by the plethora of
fora which now may hear these cases. When the Competition
Act was drafted, the clear intention was that there would be
two specialist bodies, the Tribunal and this court. This court
would be a court of final jurisdiction in matters dealing with the
Act, save in the case of questions of jurisdiction, where an
appeal lay to the Supreme Court of Appeal and in respect of
any constitutional matter arising in terms of the Act, in which
case the Constitutional Court was the court of final
adjudication.
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Unfortunately the drafters of the Act did not take account of
section 168(3) of the Republic of South Africa Constitution Act,
108 of 1996, which provided that the Supreme Court of Appeal
was in effect the highest court of appeal, save in constitutional
matters. Accordingly, in American Natural Soda Corporation v
Competition Commission 2003 (5) SA 655 (SCA), the Supreme
Court of Appeal, per a judgment of Farlam , JA, held that the
provisions which restricted an appeal to the Supreme Court of
Appeal to questions of jurisdiction was unconstitutional. Hence
the Supreme Court of Appeal could hear any appeal in respect
of a dispute which emerged from the Competition Act.
This correct determination of the law notwithstanding
resolutions of disputes in terms of the Act are now in a more
cumbersome position than otherwise would be the case.
Competition disputes raises issues of acute specialist
complexity. They often represent the interface between law
and economics and accordingly the legislature intended that
specialist courts would deal with these technical questions.
There is indeed before Parliament an amendment to the
Constitution to alter the position so as to bring it back in line
with that which was intended by the drafter of the Competition
Act. If this is approved, it would mean that the Act would
establish the Competition Appeal Court as the final court, save
for questions of jurisdiction and constitutional disputes or any
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dispute if the Constitutional Court becomes the apex court.
The fact that this has not yet occurred has meant that,
invariably, given the resources available to parties in these
cases, appeals are lodged from decisions of this court to the
Supreme Court of Appeal. Indeed in the present case a
decision of the Supreme Court of Appeal in Woodlands Dairy
(Pty) Ltd & Another v Competition Commission loomed large.
Whatever the merits of the present position, the fact is that
both the role of specialist bodies and the expedition of
resolution of disputes have been significantly diminished.
That having been said, the Supreme Court of Appeal was
careful to note that it was the intention of Parliament that leave
to appeal should be a requisite to an appeal from the
Competition Appeal Court to the Constitutional Court (at para
17 of Ansac , supra ). That has been the practice since that
decision governed questions of appeals to the SCA. It is for
this reason that the appellant lodged an application for leave
to appeal before this court which was to be heard on 5
December 2011.
However, presumably as a result of advice which was taken,
the appellant has chosen to proceed directly to the
Constitutional Court. It may be that this procedure falls foul of
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section 63(2) of the Competition Act. I offer no view thereon.
What is certain is that it creates the difficulty that matters from
this court may now well be appealed to either of two courts,
depending on the particular advice given to litigants. Forum
shopping is not the best solution for a coherent jurisprudence,
although I emphasise that this point is made in general and not
about the present dispute.
Be that as it may, an application for leave to appeal is now
before the Constitutional Court. It is for the Constitutional
Court to pronounce as to whether leave to appeal will be
granted and as to whether there is merit in the appeal. This
court is now faced with a significant difficulty. Without the
benefit of a decision from the Constitutional Court, for example
that the matter must be heard by this court (presumably with
reasons having been given which would guide this court), this
court cannot hear an application for leave to appeal. It short,
it cannot hear an application for leave to appeal in
circumstances where the highest court in the land may well
decide that there is merit in the appeal and then determine the
outcome.
This Court cannot be in the position where it may accept that
there are reasonably prospects of success, or alternatively that
there is no prospect of success, on the standard of special
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leave, and then be confronted with a judgment from the
Constitutional Court which goes the other way. At the very
least, it would render this Court’s decision nugatory. That, in
itself, illustrates the problems to which I have made reference
earlier.
However, Mr Farlam correctly indicated that the matter is of
concern to the respondents. They had briefed counsel on the
expectation that there would be a hearing on 5 December. I
am not able, of course, to comment on what submissions would
be made or how the dispute would alter between that which
may be a constitutional matter, and that which may be ‘a
straight competition matter’, which may result in different
arguments put to this court as opposed to that which might be
raised before the Constitutional Court. Mr Farlam indicated
that he wished to argue before the Constitutional Court that the
dispute should be referred to this court for a hearing on
application for leave to appeal and that the procedures which
had been adopted following the ANSAC decision, should be
followed.
Accordingly, while the logistical difficulties of convening a
court of judges who reside in different high courts and in so
uncertain a position as might confront this Court on 5
December 2011, seem to me to pose a serious problem, this
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court places on record that it is not going to postpone the
application for leave to appeal which was to be heard on 5
December 2011 sine die . It will postpone the matter to a date
convenient to the parties, such that if the Constitutional Court
decides that the application for leave to appeal to the Supreme
Court of Appeal should be heard by this court, that hearing will
take place expeditiously.
For avoidance of doubt, that will mean that a hearing will be
convened before the end of 2011 so as to provide the parties
with a judgment, after a hearing, as to whether leave will or
will not be granted. There is no order as to costs in respect of
this morning’s hearing.
_________________
DAVIS, JP
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