Pick 'n Pay Retailers (Pty) Ltd v Minister of Mineral and Energy Affairs

• Jurisdiction: South Africa

Pick 'n Pay Retailers (Pty) Ltd v Minister of Mineral and Energy Affairs
1987 (2) SA 865 (A)

1987 (2) SA p865

Citation	1987 (2) SA 865 (A)
Court	Appellate Division
Judge	Corbett JA, Smalberger JA, Vivier JA, Nicholas AJA and Kumleben AJA
Heard	March 12, 1987
Judgment	March 26, 1987

Flynote : Sleutelwoorde

Petrol — Petroleum Products Act 120 of 1977 — Regulations made in terms of s 2(1)(d) of Act, as inserted by Act 61 of 1985, and published in Government Gazette 10260 of 2 June 1986 — Paragraph 2 (b) of regulations prohibiting any seller of F petrol in respect of whom price of petrol prescribed by law from giving any 'benefit' as defined in para 1 of regulations to consumers of petrol as condition of or as result of sale of petrol — Respondent, acting in terms of s 2(1) (c) of Act, prescribing price of petrol prior to making of above — mentioned regulations — Appellant at its service G stations operating coupon scheme involving issue of coupon, entitling holder thereof to buy goods to value of four cents or to tender coupon in part payment of goods purchased at appellant's stores, to customer for each litre of petrol bought — Appellant unsuccessfully applying for setting aside of para 2 (b) of regulations — Court on appeal holding that purpose H of s 2(1)(d) was plainly to supplement s 2(1) (c) by ensuring that, by means of appropriate regulations, a price determination made under it was not circumvented — Section 2(1)(d) authorising regulations prohibiting business practice which reduced or increased prescribed price of petrol — Coupon scheme a business practice which indirectly reduced I prescribed price of petrol by four cents a litre — Court rejecting appellant's further contention that there was no need to rely on regulations made in terms of s 2(1)(d) to prevent circumvention of prescribed price as the latter could be dealt with by way of criminal prosecution in terms of s 12 of Act — Appellant relying on differing penalties prescribed for J contraventions of s 2(1)(c) and s 2(1)(d) as indication that

1987 (2) SA p866

A s 2(1)(d) not intended to supplement s 2(1)(c) — Court holding that language of s 2(1)(d) sufficiently clear to make reference to penalty provisions of Act unnecessary — Paragraph 2 (b) of regulations held to be validly made in terms of s 2(1)(d) of Act — Appeal dismissed. B

Headnote : Kopnota

Appellant, the proprietor of a number of large retail stores at which clothing, foodstuffs etc are sold and who, in addition, operated 12 service stations at which petrol was sold, applied in a Provincial Division for an order setting aside para 2(b) of certain regulations made in terms of s 2(1)(d) of the Petroleum Products Act 120 of 1977, which subsection was inserted by the Petroleum Products Amendment Act 61 of 1985, and published in Government Gazette 10260 of 2 June 1986. The application failed but leave to appeal was granted by the Court C a quo. The facts which led to the application being made were that appellant, in March 1986, embarked upon a sales campaign, referred to as the 'coupon scheme', which involved the issue of a coupon to a customer for each litre of petrol bought at one of appellant's service stations. The coupon entitled the holder to buy goods, apart from petrol, to the value of four cents at any of appellant's stores or to tender the coupon in part payment of goods purchased. In May 1986 respondent, acting in terms of s 2(1)(c) of the 1977 Act, prescribed the selling price of petrol. Appellant proceeded to D sell petrol at the price prescribed by law but continued to operate its coupon scheme. Thereafter the respondent published the above-mentioned regulations on 2 June 1986, para 2(b) of which prohibited any person in respect of whom the selling price of petrol had been prescribed by law from, as a condition of or as a result of any sale of petrol, giving or offering any benefit to any consumer. It was conceded in the Court a quo and on appeal that the issue of a coupon by appellant under the E coupon scheme amounted to the offer or giving of a benefit as defined in reg 1, and that the regulations, if valid, would therefore prohibit the coupon scheme. The validity of reg 2(b) was challenged on two grounds in the Court a quo, viz, firstly, that the regulation was ultra vires the enabling provision (s 2(1)(d) of the Act) as the respondent, in making the regulation, had exceeded the powers conferred by s 2(1)(d) and, secondly, that, even if the regulation was held to be intra vires in this sense, it was nevertheless invalid inasmuch as it was made for an ulterior purpose not intended by s 2(1)(d). The F first ground was not pursued on appeal and, as far as the second alternative ground was concerned, appellant contended on appeal that the power conferred by s 2(1)(d) (like the power conferred by s 2(1)(c)) was given for the purpose of maintaining the price of petrol and that it was not introduced to cure any inadequacy or insufficiency in the application of s 2(1)(c) or as a means of enforcing compliance with a determination of price prescribed thereunder, but related to an alternative regime. The Court on appeal thus had to determine G whether this was the correct interpretation to be placed on the language of s 2(1)(d),

Held, that where a price was prescribed in terms of s 2(1)(c), s 2(1)(d) authorised regulations prohibiting a business practice or method of trading which changed the prescribed price by reducing or increasing it and that the coupon scheme was a method of trading which did just that - the issue of a coupon indirectly reduced the prescribed price of petrol by four cents per litre.

Held, therefore, that the purpose of s 2(1)(d) was plainly to H supplement s 2(1)(c) by ensuring that, by means of appropriate regulations, a price determination made under it was not circumvented.

Held, further, as to appellant's contention that any circumvention of the prescribed price could be dealt with by way of a criminal prosecution (in terms of s 12 of the Act) for a contravention of s 2(1)(c) and that there was therefore no need to rely upon regulations made in terms of s 2(1)(d) to I prevent this, that the Legislature had foreseen the possibility that the accused in such a prosecution could have raised the defence that no offence was committed since the prescribed price was paid and the issue of the coupon was no more than an indirect benefit not prohibited by the Act or its regulations, and had therefore passed an amendment to introduce s 2(1)(d).

Held, finally, as to appellant's reliance on the heavier penalties prescribed by s 12 of the Act for a contravention of s 2(1)(d) than for a contravention of s 2(1)(c), its contention being that, if the purpose of s 2(1)(d) was to supplement s J 2(1)(c), one would not expect an indirect contravention to carry a heavier penalty than a direct

1987 (2) SA p867

one, that the differing penalties could not serve as a reliable A guide to the meaning of s 2(1)(d) and that the language of the section was moreover sufficiently clear to make any reference to the penalty provisions of the Act unnecessary. Appeal dismissed.

The decision in the Cape Provincial Division in Pick'n Pay Retailers (Pty) Ltd v Minister of Mineral and Energy Affairs confirmed.

Case Information

Appeal from a decision in the Cape Provincial Division (Berman B J). The facts appear from the judgment of Kumleben AJA.

S Aaron SC (with him L Weinkove) for the appellant: It is settled law that where a public body or official is given a power for a particular purpose, that power 'cannot be used for obtaining any other object, however laudable'. Van Eck NO and C Van Rensburg NO v Etna Stores 1947 (2) SA 984 (A) at 996 - 7; Broadway Mansions Ltd v Pretoria City Council 1955 (1) SA 517 (A) at 522B. It therefore becomes necessary to ascertain the purpose for which the power to regulate or prohibit business practices was given in s 2(1)(d) of the Petroleum Products Act 120 of 1977. According to the long title of the Act, the D purposes for which the Act was passed included 'to provide measures for the saving of petroleum products and an economy in the cost of the distribution thereof, and for the maintenance of a price therefor'. Section 2(1)(d) is one of five subsections in s 2(1). Prior to the amendments effected by Act 61 of 1985, there were only three subsections: Section 2(1)(a) indicated expressly the purpose for which the powers referred E to therein were given: 'the purposes of ensuring or saving of petroleum products'. This is the first of the broad purposes mentioned in the long title. The motive was clearly to regulate petrol supplies in times of possible shortages, or in the interests of the national economy. Section 2(1)(b) also indicated expressly the purpose for which the powers referred F to therein were conferred: 'the purposes of ensuring an economy in the cost of distribution...'. This coincides with the second purpose enumerated in the long title. Section 2(1)(c) empowered the Minister to prescribe the price at which any petroleum product might be sold by any person. Although the subsection did not expressly state the purpose for which the power of prescribing prices was conferred, this was clearly for the third of the purposes stated in the long title. As was said G by Rose-Innes J (in the unreported matter of Pick'n Pay Retailers (Pty) Ltd v Minister of Mineral and Energy Affairs (CPD) case No 2352/86): 'that purpose is to maintain the petrol price by prescribing the price and not to permit it to fluctuate according to market trends'. The Act was amended by Act 61 of 1985. The 1985 amendment changed the introductory H words in s 2 (these changes are not relevant to the present enquiry), and also added s 2(1)(d) and (e). These new subsections do not indicate in express terms the purpose for which these powers...