Richards Bay Bulk Storage (Pty) Ltd v Minister of Public Enterprises

• Jurisdiction: South Africa
• Judge: E M Grosskopf JA, F H Grosskopf JA, Nienaber JA, Marais JA, Scott JA
• Judgment Date: 26 March 1996
• Citation: 1996 (4) SA 490 (A)
• Docket Number: 242/94
• Hearing Date: 23 February 1996
• Counsel: S J du Plessis SC (with him P J Venter) for the appellant. P J Olsen SC (with him R J Salmon) for the respondent.
• Court: Appellate Division

E M Grosskopf JA:

In 1982 the South African Transport Services, the predecessor of Transnet Ltd ('Transnet'), which was the second respondent in the Court a quo, let G a site in the Richards Bay harbour area to the appellant for the reception, storage, handling and distribution in bulk of liquid and liquefied products. At all material times this lease remained operative and the appellant continued to make use of the bulk liquid storage facilities erected on the leased property.

Virtually from the inception of the lease Island View Storage (Pty) Ltd ('IVS'), the third respondent in the Court a quo, made various attempts to persuade Transnet's predecessor, and later Transnet itself, to grant a similar lease to IVS in respect of H vacant land in the Richards Bay harbour area. The land was the property of Transnet's predecessor and from 1990 it belonged to Transnet by virtue of the provisions of the Legal Succession to the South African Transport Services Act 9 of 1989. However, all IVS's endeavours proved to be fruitless.

On 15 November 1991 the Competition Board ('the Board') caused Government I Notice 1101 to be published in Government Gazette 13620 of that date. In terms of the notice it was made known that the board was undertaking an investigation in terms of s 10(1)(a) of the Maintenance and Promotion of Competition Act 96 of 1979 ('the Act') J

E M Grosskopf JA

A 'in order to establish whether a refusal by Transnet Ltd, or a division of that company, to lease land in the Richards Bay harbour area to Island View Storage (Pty) Ltd for the purpose of erecting a bulk liquid storage facility on such a site constitutes a "restrictive practice" as defined in s 1 of the Act'.

In terms of the said s 10(1)(a) the board, established under s 3 of the Act, may make such investigation as it may consider necessary into any restrictive practice which it has B reason to believe exists. If after such an investigation the board is of the opinion that such a practice exists, it shall under s 12(2) recommend to the Minister for Administration and Economic Co-ordination (later known as the Minister of Public Enterprises, who is the respondent in this appeal and to whom reference will sometimes be made as 'the Minister') that such action be taken under s 14(1) as he C may consider necessary. That subsection provides:

'Whenever after consideration of a report by the board in terms of s 12(1) as to the result of any investigation made by it in terms of s 10(1)(a), (b) or (d), D the Minister is of opinion that a restrictive practice exists or may come into existence . . . and is not satisfied that such restrictive practice . . . is justified in the public interest, . . . -

(a)

the Minister of Finance may, at the request of the Minister, in terms of the Customs and Excise Act 91 of 1964, by notice in the Gazette suspend, as from the date of the publication of such notice, E any duty to be paid upon imported goods of like nature to any goods affected by the operation of that restrictive practice . . . to the extent and for such period as he may deem fit;

(b)

the Price Controller may at the request of the Minister fix, under the Price Control Act 25 of 1964, the maximum price at which any commodity, other than any insurance or banking service, affected F by the operation of the said restrictive practice . . . may be sold by any person to any other person or at which any person may purchase such commodity from any other person;

(c)

the Minister may by notice in the Gazette -

(i)

declare the said restrictive practice . . . to be unlawful, and require any person who in the opinion of the Minister is concerned in the G said restrictive practice . . . to take such action, including steps for the dissolution of any body corporate or unincorporated, the severance of any connection or of any form of association between two or more persons, including any such bodies, the termination of the membership of a member of any body corporate or the application of any prohibition by the Minister on the exercise of any right to vote attached to the holding of any share in any such body, H as the Minister may consider necessary to ensure the discontinuance or prevention of that restrictive practice . . . or to eliminate any undesirable features thereof;

(ii)

require any person who is or was a party to any agreement, arrangement, understanding or omission or applies or has applied any business practice or method of trading or commits or has I committed any act or brings or has brought about any situation which may be specified in the notice, to terminate or to cease to be a party to such agreement, arrangement, understanding or omission or to refrain from applying such business practice or method of trading or to cease to commit that act or to bring about that situation or to refrain from at any time becoming a party to any agreement, arrangement, understanding or omission or applying any business practice or method of trading or committing any act or bringing about any situation of a nature specified in the notice which in the opinion of the Minister is likely to have the same effect.' J

E M Grosskopf JA

Pursuant to the publication of GN 1101 the board concluded an investigation and submitted a report which A was published in Government Gazette 14343 of 23 October 1993. Purporting to act in terms of s 14(1)(c) of the Act the respondent then published notice 1101 of 1992 in the Government Gazette of 6 November 1992. It contained the following declaration and direction: B

'I therefore declare unlawful -

Any determination in any agreement, arrangement or understanding between Transnet Ltd and Richards Bay Bulk Storage (Pty) Ltd, and any act or omission by Transnet Ltd, which has the object or effect of preventing the allocation by Transnet Ltd of suitable land to third parties C for the erection of a bulk liquid storage facility in the Richards Bay harbour area.

I further direct Transnet Ltd -

(1)

to make a suitable site available in the Richards Bay harbour area to persons who are willing and able to erect and to operate a bulk liquid storage facility, and

(2)

to ensure -

(a)

that competitive parity between undertakings is not unduly distorted by virtue only of the demarcation and allocation of such a site, and D

(b)

that the extent of the land leased to Richards Bay Bulk Storage (Pty) Ltd at present is not excessive for the purposes of its immediate and foreseeable needs.'

Section 15(1) of the Act provides for a right of appeal by any person affected by a notice under s 14(1)(c) to a Special Court constituted in terms of s 15(2) and (3). The E appellant duly noted an appeal to the Special Court against the above declaration and direction but subsequently also initiated review proceedings in the Durban and Coast Local Division against inter alia the respondent. It sought an order setting aside that declaration and direction and called upon the respondent to comply with the provisions of Rule 53(1)(b) of the Uniform Rules of Court. (The second and third respondents in F the Court a quo mentioned above...