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[2019] ZASCA 136
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Scholtz v NDPP (69/2018) [2019] ZASCA 136 (1 October 2019)
THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Not
reportable
Case
No: 69/2018
In
the matter between:
ALFEUS
CHRISTO
SCHOLTZ FIRST
APPELLANT
TRIFECTA
INVESTMENTS HOLDINGS (PTY) LTD SECOND
APPELLANT
TRIFECTA
HOLDINGS (PTY)
LTD THIRD
APPELLANT
TRIFECTA
TRADING 434 PROPERTY 4 (PTY) LTD FOURTH
APPELLANT
TRIFECTA
TRADING 434 PROPERTY 5 (PTY) LTD FIFTH
APPELLANT
TRIFECTA
TRADING 434 PROPERTY 7 (PTY) LTD SIXTH
APPELLANT
TRIFECTA
TRADING 434 PROPERTY 11 (PTY) LTD SEVENTH
APPELLANT
and
THE
NATIONAL DIRECTOR OF PUBLIC
PROSECUTIONS RESPONDENT
Neutral
citation:
Scholtz v NDPP
(69/18)
[2019] ZASCA 136
(1
October 2019)
Coram
Petse DP, Tshiqi, Saldulker, Swain, and Molemela JJA
Heard:
9 September 2019
Delivered:
1 October 2019
Summary:
Application for leave to appeal - application for condonation of
the late filing of the application for leave to appeal –
envisaged appeal has no reasonable prospects of success –
condonation therefore not granted.
ORDER
On
appeal from:
Northern Cape Division of the High Court, Kimberley
(Phatshoane J sitting as court of first instance):
1.
The application for condonation of the late filing of the application
for leave to appeal is dismissed.
2.
The application for leave to appeal is struck off from the roll.
JUDGMENT
Tshiqi
JA (Petse DP, Sadulker, Swain and Molemea JJA concurring):
[1]
There are two applications that have to be considered in this matter.
The main one is an application for leave to appeal against
a
confiscation order granted by the Northern Cape Division of the High
Court, Kimberley (court
a quo
) against the first to seventh
applicants in terms of s 18 of Prevention of Organised Crime Act 121
of 1998 (POCA). The second application
is ancillary to the main one
and is an application for condonation of the late filing of the main
application. Both applications
were first considered by this court on
22 March 2018 and were referred for oral argument in terms of
s 17(2)
of the
Superior Courts Act 10 of 2013
. The court also ordered the
parties to be prepared, if called upon to do so, to address it on the
merits of the appeal against
the confiscation order.
[2]
The first to seventh applicants were convicted in the court
a quo
on counts of corruption and money laundering. Subsequent to the
convictions, an enquiry was held in terms of
s 18
of POCA and, on 6
December 2016, the court made the confiscation order which is the
subject of this application for leave to appeal.
The amounts ordered
to be confiscated were R6 043 960.15 and R53 763 021.85 respectively,
against all the applicants, jointly and
severally, the one paying the
other to be absolved. The total amount was R59 806 982.00. Subsequent
to the convictions and the
confiscation order, the court
a quo
sentenced the applicants as follows:
a)
the first applicant was sentenced to 15 years imprisonment on each of
the two counts of corruption and 12 years imprisonment
on each of the
two counts of money laundering. The court ordered that the sentences
imposed be served concurrently.
b)
the second to seventh applicants were each sentenced to a fine of
R150 000 on a count of corruption and second and third
applicants were sentenced to a fine of R75 000 on the
money laundering count.
[3]
In terms of Rule 49(1) of the Uniform Rules of Court, an appeal ought
to be filed within 15 days of the order against which
the appeal
lies. However, an arrangement was reached between the applicants and
the National Director of Public Prosecutions (NDPP)
that the
applicants would apply for leave to appeal against the convictions
and sentences, as well as the confiscation order on
6 February 2017.
Only the application for leave to appeal against the convictions and
sentences was brought before the court
a quo
on this date. The
court
a quo
dismissed the application. A subsequent appeal to
this court against the convictions was partially successful in that
only the convictions
on corruption in count 8 were confirmed. The
sentences relating to the other counts consequently fell away and
only the sentence
of 15 years imprisonment remained. The appeal
against this sentence was unsuccessful.
[4]
The application for leave to appeal against the confiscation order,
together with an application for condonation for its late
filing,
were filed in the court
a quo
only on 10 October 2017. This
was approximately 10 months after the date of the confiscation order
and approximately 8 months after
the date agreed to between the
parties, 06 February 2017. The court
a quo
dismissed both
applications with costs.
[5]
In explaining the delay, the first applicant, who attached a
confirmatory affidavit of his attorney, Mr Du Plessis, stated that
on
6 February 2017 the application for leave to appeal against the
confiscation order had already been drawn, together with the
application for condonation for its late filing, although these had
not yet been filed. On the same date, Mr Du Plessis approached
Phatsoane J’s Registrar in order to ascertain her availability,
which was apparently for the purposes of setting the applications
down for hearing. He was told that the Judge was not available. He
then handed over the applications to a Mr Pino, employed as
a
candidate attorney at the offices of Mjila Attorneys, his
correspondent attorneys in Kimberley. Mr Du Plessis requested Mr Pino
to file and serve the applications and make arrangements with the
office of the Judge for the hearing of the applications.
[6]
Mr Du Plessis stated further that he made enquiries regarding the
date of the hearing of the applications from time to time
and was
informed that it was not yet allocated. At some stage he was
furnished with a letter dated 7 July 2017 from Mjila Attorneys
confirming that Mr Pino had gone to the court a quo on 8 February
2017. The letter, which was attached to the application for
condonation, simply stated that when Mr Pino went to the court on 8
February 2017, the Judge’s clerk was off-sick and was
therefore
not able to ‘furnish’ dates on which the Judge would be
available. In his affidavit, Mr Du Plessis went on
to state that it
later transpired that the applications were never filed. According to
him, he was informed that Mr Pino was under
the impression that a
date for the hearing had to be arranged before the applications were
filed. Mr Du Plessis asserted that it
was always his intention to
have the applications filed timeously and that there was a
misunderstanding concerning the procedure
to be followed. Mr Du
Plessis did not attach a confirmatory affidavit from Mr Pino to
support the application for condonation.
[7]
The applications were opposed by the NDPP. In an affidavit deposed to
by the senior Deputy Director of Public Prosecutions,
Dr Nkululeko
Ndzengu, he stated that he only became aware of the applications on
25 October 2017, after he was notified through
an email from the
Registrar’s office. He stated that the applicants’
attorneys knew his contact details and further
that the State
Attorney, Kimberley was the address of service for the NDPP. Dr
Ndzengu stated that it had always been the understanding
of the
parties that the applicants would only seek leave to appeal against
the convictions and sentences. The rationale for this,
according to
Dr Ndzengu, was that if the convictions and sentences were ultimately
set aside on appeal, then the confiscation order
would fall away, but
that if the appeal failed, then the confiscation order would stand.
Dr Ndzengu contended further that the
confiscation order was in any
event not final and thus not appealable. He stated that for this
reason the confiscated amount had
been deposited into the National
Treasury’s suspense account pending the appeal against the
convictions and that there would
consequently be no prejudice to the
applicants if the confiscation order stood, pending the appeal on the
convictions.
[8]
In determining the application for condonation, the court a quo
correctly stated that it had to exercise its discretion by having
regard to the degree of lateness, the explanation therefor, the
reasonableness of the non-compliance, the importance of the matter,
any prejudice likely to be suffered by any of the parties, and the
applicant’s prospects of success on appeal (Melane v Santam
Insurance Co Ltd 1962(4) SA 531 (A) at 532; Uitenhage Transitional
Local Council v South African Revenue Service
2004 (1) SA 292
(SCA)
para 6).
[9]
The main difficulty for the applicants in the application for
condonation is that the availability of a Judge was not a
prerequisite
for the filing of an application for leave to appeal.
The timelines set for the filing of court papers and the availability
of
a Judge for the purposes of setting a matter down for hearing are
two separate processes. Even if Phatsoane J was unavailable, the
applications could have been filed and a date would have been
arranged later. In any event, the unavailability of a Judge who made
the order does not prevent the Judge President or the Deputy Judge
President from hearing an application for leave to appeal or
from
allocating the application to another Judge for the purposes of
hearing such an application. This is a common occurrence in
all the
high courts, whenever a Judge is temporarily unavailable to hear an
application for leave to appeal. In any event, it does
not seem that
this alleged unavailability of Phatsoane J was ever brought to the
attention of the Judge President or his Deputy.
The other difficulty
for the applicants is that Mr Du Plessis does not state what steps he
took to follow up on the matter between
6 February and 7 July 2017 to
satisfy himself that the application had been filed. As the court
a
quo
noted, there is no explanation why Mr Du Plessis did not
diarise his client’s file and why a matter of such importance
to
the applicants, which involves millions of rands, would be
entrusted to a candidate attorney without any measure of supervision.
There is thus no proper explanation for the lengthy delay in filing
the application for leave to appeal.
[10]
This then leads me to the second consideration: whether there are any
reasonable prospects of success on appeal. The main ground
on which
the applicants seek to appeal the confiscation order is that the
court
a quo
erred in its finding that the parties had
concluded an agreement on the amounts that would be the subject of
the confiscation order.
Counsel for the applicants submitted that
clause 1.2 had to be interpreted to mean that the amounts to be
confiscated were dependent
on a finding by the court
a quo
that
each of the entities had received proceeds of crime as envisaged in s
18 of POCA through the income received as rental from
the lease
agreements stipulated in the agreement. And that clause 1.3 had to be
interpreted to mean that each of the entities received
proceeds of a
crime as a result of the increase in value of any of the buildings
relevant to the lease agreements. That in the
event that any of the
entities had not been proven to have received any income generated
from the lease agreements, or if at the
time of the sale of any of
the buildings, it was not proved that there was an increase in the
value of any such buildings, as a
result of the lease agreements,
then the agreed amounts would have to be reduced proportionately.
Counsel submitted that as the
state did not prove that there was an
increase in the value of any building sold, which increase was as a
result of the lease agreements,
the amount reflected in the agreement
had to be reduced proportionately.
[11]
The respondent has submitted that the interpretation of the agreement
advanced by the applicants is inconsistent with the clear
wording of
the settlement agreement which, in relevant parts, provides as
follows:
‘
1.
The parties agree that the following issues are still in dispute and
remain in dispute for adjudication by this Honourable Court:
1.1
The question whether Applicant is entitled to a confiscation order in
terms of section 18 of POCA.
1.2
The question whether the Applicant established that the First to
Seventh Defendants, or
any of them
received proceeds of crime
as envisaged in section 18 of POCA, with reference to the income
received as rental from the lease agreements
relevant to this case
ie.
1.2.1
Kimberlite Hotel, Kimberley . . .;
1.2.2
Northern Cape Training Centre, Kimberley . . .;
1.2.3
Du Toitspan Building . . .;
1.2.4
14 Van Riebeeck Street, Springbok . . .;
1.2.5
Summerdown Place, Kuruman . . .; and
1.2.6
Keur and Geur Biulding, Douglas . . .
1.3
The question whether the Applicant established that the Defendants,
or
any of them
received proceeds of a crime as envisaged in
section 18 of POCA, as a result of the increase in value of
any of
the buildings
relevant to the lease agreements set out in
paragraphs 1.2.1 to 1.2.6 above.
2.
In the event that this Honourable Court finds that:
2.1
The Applicant did establish that Applicant is entitled to a
confiscation order in terms of section 18 of POCA, relating to the
income generated with reference to the lease agreements entered into
by the relevant Defendant(s) and the relevant Governmental
Department(s); and
2.2
This Honourable Court further finds that Applicant established that
the relevant Defendant(s) did receive proceeds of crime
as envisaged
in section 18 of POCA, relating to the income generated with
reference to the lease agreements relevant to this case.
Then
the parties agree that the amount that the Court should make an order
for confiscation in terms of section 18 of POCA relating
to the
income generated with reference to the lease agreements, referred to
in paragraph 1.2 above, should be an aggregate amount
of R6 000
000.00 (Six Million Rand) payable by the First to Seventh Defendants,
the one to pay the other to be absolved.
3.
In the event that this Honourable Court finds that:
3.1
The Applicant did establish that Applicant is entitled to a
confiscation order in terms of section 18 of POCA, relating to the
increased value of the properties relevant to the lease agreements
set out in paragraph 1.2 above; and
3.2
The applicant did establish that Applicant is entitled to a
confiscation order in terms of section 18 of POCA relating to the
increase in capital value of the buildings relevant to the lease
agreements referred to in paragraph 1.2 above.
THEN
the Parties agree that the amount that the Court should make an
order for confiscation in terms of section 18 of POCA, relating to
the increased value of the properties relevant to the lease
agreements set out in paragraph 1.2 above, should be an aggregate
amount of R54 000 000.00 (Fifty-Four Million Rand), payable by the
First to Seventh Defendants, the one to pay the other to be
absolved.’
[12]
A
court must have regard to the words used in a document and construe
them objectively (
KPMG
Chartered Accountants (SA) v Securefin Ltd &
another
[2009]
ZASCA
7
;
2009
(4) SA 399
(SCA)
para 39, and
Natal
Joint Municipal Pension Fund v Endumeni Municipality
[2012]
ZASCA 13
;
2012
(4) SA 593
(SCA)
para 18). If a document was intended to provide a complete memorial
of a jural act, extrinsic evidence may not contradict,
add to or
modify its meaning (
Johnson
v Leal
1980
(3)
SA
927
(A)
at 943B). To the extent that evidence may be admissible to
contextualise the document to establish its factual matrix or purpose
or for purposes of identification, ‘one must use it as
conservatively as possible’ (
Delmas
Milling Co Ltd v du Plessis
1955
(3) SA 447
(A)
at 455B-C;
Novartis
v Maphil
[2015]
ZASCA 111
;
2016 (1) SA
518
(SCA)).
[13]
The language of the agreement is clear. In terms of clause 1.2 of the
agreement the state had to prove that the defendants,
or
any of
them
received the proceeds of crime as envisaged in s 18 of POCA
with reference to the income received as rental from the lease
agreements.
In terms of clause 1.3 the state had to prove that the
defendants, or
any of them
, received proceeds of a crime as
envisaged in s 18 of POCA, as a result of the increase in value of
any of the buildings
relevant to the lease agreements. The
interpretation advanced by the applicant would entail a substitution
of the highlighted clear
wording of the agreement ie ‘
any of
them’
with ‘
each of them
’ and ‘
any
of the buildings’ with
‘
each of the buildings
’
respectively. And also entirely ignores the fact that the parties
expressly agreed that the applicants’ liability,
once
established, would be joint and several, the one paying the other to
be absolved. There is no legal basis for interpreting
the agreement
in this fashion.
[14]
The context within which the agreement was concluded supports the
above interpretation. Mr White, the NDPP’s auditor,
had deposed
to an affidavit in the court
a quo
complaining that the
applicants had not provided him with all their financial documents.
The parties were also faced with the reality
that there were huge
discrepancies between Mr White’s calculations on behalf of the
NDPP, pertaining to the income generated
and those of his
counterpart, Mr Bouwer, the auditor for the applicants. Both parties
foresaw that any attempt to determine the
applicants’ benefit
accurately would result in protracted litigation. In order not to
prolong the s 18 enquiry, the parties
agreed to enter into the
settlement agreement. During his address in the court
a quo
,
counsel for the applicants referred to the agreement and said that
‘the agreement will assist . . ., especially the fact
that the
. . . agreed amounts relating to the leases and the capital increases
in value had been properly set out in
annexures . . .’.
There is thus no basis for departure from the terms of the agreement.
I therefore agree with the finding
of the court
a quo
that
there are no prospects of success on appeal on this aspect. I also
endorse the conclusion of the court
a quo
that where there are
no prospects of success on appeal, there would be no point in
granting condonation.
[15]
I therefore make the following order:
1. The application for condonation of
the late filing of the application for leave to appeal is dismissed.
2. The application for leave to appeal
is struck off from the roll.
_________________
Z
L L Tshiqi
Judge
of Appeal
APPEARANCES:
For
First to Seventh Appellants: M M W van Zyl SC
Instructed
by: Werner Du Plessis Attorneys, Pretoria
Claude
Reid Inc., Bloemfontein
For
Respondent: H J van der Linde SC
Instructed
by: Director of Public Prosecutions, Pretoria
Director
of Public Prosecutions, Bloemfontein