Offit Enterprises (Pty) Ltd and Another v Coega Development Corporation and Others

• Jurisdiction: South Africa

Offit Enterprises (Pty) Ltd and Another v Coega Development Corporation and Others
2010 (4) SA 242 (SCA)

2010 (4) SA p242

Citation	2010 (4) SA 242 (SCA)
Case No	09/09
Court	Supreme Court of Appeal
Judge	Harms DP, Lewis JA, Maya JA, Hurt AJA and Wallis AJA
Heard	November 3, 2009
Judgment	February 15, 2010
Counsel	RG Buchanan SC (with SC Rorke) for the appellants.; MR Madlanga SC (with N Mayosi) for the first respondent.; SJ Grobler SC (with BJ Pienaar) for the second and third respondents.; AE Bham SC (with T Mota) for the fourth respondent.

Flynote : Sleutelwoorde F

Administrative law — Administrative action — What constitutes — Delay in G administrative action — Administrative action including failure to take decision — Anticipated future administrative action, however, not subject to judicial review.

Administrative law — Review — Scope — Anticipated future administrative action not subject to judicial review — Promotion of Administrative Justice Act 3 of 2000, s 6(2)(g).

H Constitutional law — Human rights — Right to property — Deprivation of property — What constitutes — Threat of expropriation — Financial disadvantage resulting from threat of expropriation not constituting deprivation of property — Constitution, s 25(1).

Expropriation — Mandamus — Application for order directing Minister to initiate I lawful expropriation process within specified period of time — Mandamus

2010 (4) SA p243

incompetent, as offending against separation of powers — Application A dismissed.

Expropriation — Validity — Expropriation for the benefit of third party — Whether such expropriation can be said to be for public purpose or in public interest — Whether invalidity of permit to operate industrial development zone affecting lawfulness of potential expropriation — Whether landowner B entitled to order compelling authority to expropriate land — Whether undue delay in expropriation constituting unfair administrative action.

Headnote : Kopnota

The appellants unsuccessfully applied in the Eastern Cape High Court for an order declaring that the threatened expropriation of its properties situated within the boundaries of the Coega Industrial Development Zone (IDZ) at C the instance of any of the respondents would be unlawful under the applicable legislation. On appeal, the appellants' contentions why the expropriations should be held to be unlawful were repeated as follows: (i) it would not be for a public purpose, nor was first respondent a juristic person, as contemplated in the Expropriation Act; (ii) because of the alleged invalidity of their provisional permits, the IDZ operator permit D issued by the fourth respondent to the first respondent was invalid, and consequently the first respondent operated the IDZ unlawfully, so that any expropriation for the first respondent's benefit would be for an unlawful purpose; (iii) that, given the long history of the matter, the failure to take the decision to expropriate was administrative action in terms of s 6(2)(g) of PAJA, and not only constituted unfair administrative action, but also gave E rise to a breach of appellants' constitutional rights insofar as it constituted a pro tanto deprivation of their property, as contemplated in terms of s 25(1) of the Constitution. In the alternative, the appellants repeated their application for the court to issue a mandamus compelling any one of the respondents desirous of expropriating their properties, to initiate proceedings to do so within one month of the court's order. The findings of the F Eastern Cape High Court were accordingly confirmed and the appeal dismissed.

Held, that while s 2(1) of the Expropriation Act 63 of 1975 gave the Minister the power to expropriate 'any property for public purposes', the Constitution provided in s 25(2)(a) that property could be expropriated for a public purpose or in the public interest. The reference to 'public purposes' in the G Expropriation Act therefore had to be construed as including both of these concepts, in accordance with the principle that statutes must, where possible, be construed as consonant with the Constitution. (Paragraph [11] at 248I - 249B.)

Held, further, that it could not be said, having regard to the Constitution and the importance of public — private partnerships in many major development H initiatives, that expropriation can never be for a public purpose merely because the ultimate owner of the land after expropriation will be a private individual or company. (Paragraph [15] at 250E - G.)

Held, further, that expropriation of the appellants' properties for the purposes of their inclusion in the Coega IDZ would not only serve a public purpose, but also plainly be in the public interest, so that it would be permissible under I s 2 of the Expropriation Act. (Paragraph [18] at 251G - 252A.)

Held, that the first respondent being a juristic person, and the expropriation of the appellants' properties being for a purpose of public importance, which cannot be attained without such expropriation, the expropriation of the appellants' properties for the purposes of their inclusion in the Coega IDZ would be legally permissible under s 3(2)(h) of the Expropriation Act. J (Paragraph [21] at 252D - F.)

2010 (4) SA p244

A Held, further, that the operating permit was in fact valid, and in any event its alleged invalidity would not render an otherwise permissible expropriation impermissible, because it would not alter the fact that the expropriation would serve a public purpose and be in the public interest. (Paragraphs [22] and [24] at 252G - H and 253D.)

Held, further, that, while the continued threat of expropriation may have an B ongoing negative impact on the market value of the properties, such financial disadvantage does not constitute a deprivation of property under s 25(1) of the Constitution. (Paragraph [41] at 258D - F.)

Held, further, that the delay in taking the decision to expropriate was not undue, given the nature of the Coega IDZ development, and it was accordingly unnecessary to explore whether an undue delay in the decision to expropriate C may constitute a deprivation of property. (Paragraph [41] at 258F - H.)

Held, further, that s 6(2)(g) of PAJA is not directed at decisions in regard to future policy, such as whether property will be expropriated, but at dilatoriness, and aims to protect the citizen against bureaucratic stonewalling. (Paragraph [43] at 258I - 259C.)

Held, further, that the administrative action sought to be condemned as unfair D had not yet materialised, and might well be a model of administrative fairness if and when it does. It is in general not permissible to seek an interdict against future administrative action when the parameters of such action are so indistinct. (Paragraph [44] at 259E - G.)

Held, further, that the protection that the Constitution affords against arbitrary deprivation of property may enable a property owner to seek relief in certain E situations, but as a general proposition the expropriating authority must be left to decide for itself when to expropriate, since for a court to intervene, to compel it to make a decision, would trespass across the boundaries constituted by the separation of powers into the terrain of the Executive. (Paragraph [48] at 260F - H.) Appeal dismissed.

Cases Considered

Annotations

Reported cases F

Southern African

Administrator, Transvaal and Another v J van Streepen (Kempton Park) (Pty) Ltd 1990 (4) SA 644 (A): dictum at 660I applied but dictum at 661C - D not followed

Broadway Mansions (Pty) Ltd v Pretoria City Council 1955 (1) SA 517 (A): referred to G

City of Cape Town v Helderberg Park Development (Pty) Ltd 2007 (1) SA 1 (SCA): referred to

Du Toit v Minister of Transport 2006 (1) SA 297 (CC) (2005 (11) BCLR 1053): dicta in paras [26] - [37] applied

Ekurhuleni Metropolitan Municipality v Dada NO and Others 2009 (4) SA 463 (SCA) ([2009] 3 All SA 379): referred to H

Fourie v Minister van Lande en 'n Ander 1970 (4) SA 165 (O): dicta at 172B - 175A applied

Mkontwana v Nelson Mandela Metropolitan Municipality and Another; Bissett and Others v Buffalo City Municipality and Others; Transfer Rights Action Campaign and Others v MEC, Local Government and Housing, Gauteng, and Others (KwaZulu-Natal Law Society and Msunduzi Municipality as Amici Curiae) I 2005 (1) SA 530 (CC) (2005 (2) BCLR 150): referred to

Offit Enterprises (Pty) Ltd and Another v Coega Development Corp (Pty) Ltd and Others 2009 (5) SA 661 (SE): confirmed on appeal

Oudekraal Estates (Pty) Ltd v City of Cape Town and Others J 2004 (6) SA 222 (SCA) ([2004] 3 All SA 1): referred to

2010 (4) SA p245

Reflect-All 1025 CC and Others v Member of the Executive Council for Public Transport, Roads and Works, A Gauteng Provincial Government, and Another 2009 (6) SA 391 (CC): referred to

White Rocks Farm (Pty) Ltd and Others v Minister of Community Development 1984 (3) SA 785 (N): referred to.

Foreign

England B

Pointe Gourde Quarrying and Transport Co Ltd v Sub-Intendent of Crown Lands [1947] AC 565 (PC): referred to

Transport for London (London Underground Ltd) v Spirerose Ltd (in administration) [2009] 4 All ER 810 (HL): referred to. C

European Court of Human Rights

James v United Kingdom (1986) 8 EHRR 123: referred to

Sporrong and Lönnroth v Sweden (1982) 5 EHRR 35: referred to.

United States D

Berman v Parker 348 US 26 (1954): referred to

Hawaii Housing Authority v Midkiff 467 US 229 (1984): referred to

Kelo v City of New London 545 US 469 (2005): referred to.

Statutes Considered

Statute

The Constitution of the Republic of South Africa, 1996, s 25(2)(a): see E Juta's Statutes of South Africa 2008/9 vol 5 at 1-26

The Expropriation Act 63 of 1975, ss 2(1) and 3(2)(h): see Juta's Statutes of South Africa 2008/9 vol 6 at 3-272 and...