IN THE LAND CLAIMS COURT OF SOUTH AFRICA

Transcription

1 IN THE LAND CLAIMS COURT OF SOUTH AFRICA Held at PORT ELIZABETH CASE NUMBER : LCC35/97 THE FARMERFIELD COMMUNAL PROPERTY TRUST Claimant concerning: THE REMAINING EXTENT OF PORTION 7 OF THE FARM KLIPHEUVEL NO 459 JUDGMENT GILDENHUYS J : Background [1] The Farmerfield Communal Property Trust (hereinafter the trust ) claims the restoration of portion 7 of the farm Klipheuvel No 549, Division of Albany, in extent 252,5899 hectares ( the property ), in terms of the provisions of the Restitution of Land Rights Act ( the Restitution Act ). 1 The land is now registered in the names of Mr C L Riddin and Mrs J E A Riddin, married in community of property ( the present owners ). The matter was referred to this Court by the Chief Land Claims Commissioner under section 14(1)(b) of the Restitution Act. The present owners and the Department of Land Affairs ( the Department ) filed notices to participate in the case. Although this was not the position when the matter was originally referred to the Court, the only real dispute now remaining between the parties is the amount of compensation which must be paid to the present owners for having to give up their property. There are also some difficulties in the interpretation of the Restitution Act relating to the procedure for achieving the restoration of the property and for determining the compensation. 1 Act No 22 of 1994

2 2 [2] The provisions of the Restitution Act dealing with the restoration of land and the determination of compensation applicable to this case are sections 14(1)(b), 22(1)(b), 35(1)(a) and 35(5). The relevant portions of these sections [except section 22(1)(b), which is quoted in par 11 hereunder] read as follows : 14(1) If upon completion of an investigation by the Commission-... (b) the regional land claims commissioner certifies that it is not feasible to resolve any dispute arising from such claim by mediation and negotiation,... the Chief Land Claims Commissioner shall certify accordingly and refer the matter to the Court. 35(1) The Court may order - (a) the restoration of land... and, where necessary, the prior acquisition or expropriation of the land, portion of land or right in land. 35(5) If the Court orders the State to expropriate land or a right in land in order to restore it to the claimant, the Minister shall expropriate such land or right in accordance, mutatis mutandis, with the provisions of the Expropriation Act, 1975 (Act No 63 of 1975) : Provided that the owner of such land or right shall be entitled to the payment of just and equitable compensation, determined either by agreement or by the Court according to the principles laid down in section 25(2) and (3) of the Constitution: Provided further that the procedure to be followed by the Court in the determination of such compensation shall be as provided in sections 24 and 32 of this Act. [3] During a conference held on 28 October 1998 the parties agreed that the Court should hear and adjudicate upon the following issues at a hearing on 4 November 1998 : (1) Whether this court has the necessary jurisdiction in terms of Section 35(5) of the Act to determine the question of just and equitable compensation payable to a landowner in respect of land to be expropriated for purposes of restoration prior to, at the same time as, or in the proceedings relating to, the issuing of an order to expropriate the said land in terms of Section 35(1)(a) of the Act. (2) Whether the Minister of Land Affairs is empowered by Section 35(5) of Act 22 of 1994 to exercise all the powers conferred upon the Minister of Public Works by the Expropriation Act (Act 63 of 1975), in relation to the expropriation of land ordered in terms of Section 35(1)(a) of the Act.

3 3 (3) Whether this court has jurisdiction to determine the compensation payable in regard to land expropriated in accordance with the provisions of the Expropriation Act where such expropriation occurs in consequence of an order made by this honourable court in terms of Section 35(1)(a) of the Act. May the court determine the compensation when ordering the State to expropriate land? [4] In the matter presently pending before the Court, the dispute regarding the amount of the compensation payable to the present owners has been fully ventilated in the papers which were filed in response to the referral report. The parties would like that dispute to be resolved in these proceedings. Does the Court have jurisdiction to make a determination on the compensation in these proceedings? At first blush, the broad reference to any dispute arising from such claim in section 14(1)(b) would seem to include as a dispute, capable of resolution upon referral, the determination of compensation payable to the owner of the land to be restored. However, close scrutiny of other relevant provisions of the Act reveals practical difficulties with this approach. [5] The power of this Court to determine compensation is derived from section 22(1)(b) of the 2 Restitution Act, and may be exercised upon expropriation. The word upon, as used above, has a temporal meaning, which can include any of the following : on the occasions of, following 3 upon, very soon after or at the time of. The provisions of the Expropriation Act, which must be applied mutatis mutandis in terms of section 35(5) of the Restitution Act, provide for the 4 determination of compensation in respect of property expropriated. Under that Act, the compensation is determined after the expropriation, not at the time of expropriation or before the expropriation. This suggests that the word upon, where it appears in section 22(1)(b) of the Restitution Act, means following upon, and is intended to convey that the Court may not exercise its statutory power to determine the amount of compensation payable for an expropriation before the Section 22(1)(b) is fully quoted in para 11 below Hill v Secretary for Inland Revenue 1966(3) SA 1(C) at 3F - H. Section 12(1) of the Expropriation Act

4 4 5 expropriation has actually occurred. The existence of an expropriation is a prerequisite to the Court s jurisdiction. If there is no expropriation, the Court has no power to determine the compensation. It is also clear from section 35(1)(a) and section 35(5) of the Restitution Act that the expropriation can only take place after, and under the authority of, an order by this Court to expropriate the land in order to restore it to the claimant, and not in the proceedings leading up to such an order. [6] These conclusions are borne out by practical realities. Compensation payable in respect of an expropriation must be determined with regard to values as at a specific date. As stated by De Vos AJ 6 in Government of the Republic of South Africa v Motsuenyane - Applicant correctly contends that a fixed date of expropriation is an essential prerequisite for determining compensation since values as at a specific date must be ascertained. It is common knowledge that protracted proceedings often follow on disputes regarding compensation and the absence of a fixed date with reference to which values are ascertainable would clearly render judicial process abortive. If the date in respect of which values must be ascertained is a future date (as would be the case if the compensation were to be determined in these proceedings), it will be impossible to know, as at the date of determination, what those future values will be. What happens if valuable mineral deposits are discovered on the property after the determination but before the expropriation? What influence will a comparable sale which occurred after the determination but before the expropriation, have on any determination of market value? These difficulties illustrate the inappropriateness of the Court determining compensation which will be due under an expropriation before the expropriation has actually taken place. 5 6 Section 14(3)(b) of the Expropriation Act provides that a specific time period must expire before an action for the determination of compensation may be instituted (2) SA 484T and 489D - E.

5 5 [7] I have therefore come to the conclusion that if the Court should order the State to expropriate 7 land in order to restore it to a claimant, the Court has no jurisdiction to determine the compensation in advance of the expropriation actually taking place. After the expropriation has taken place, this Court will have jurisdiction. I deal with that in paragraphs 11 and 12 hereunder. The mere fact that the dispute on the future compensation is contained in the papers before the Court in this case, is not by itself sufficient to give the Court jurisdiction. Nor is the fact the Court may have jurisdiction to 8 determine compensation upon an expropriation as well as upon an acquisition. In this case no acquisition has, as yet, occurred because the parties have not reached any consensus as to the terms of the transfer of the land. I express no opinion on whether it would be possible for the parties to confer jurisdiction by agreement on the Court to determine the compensation which would be payable 9 in respect of a consensual acquisition of the property in terms of the Restitution Act. The parties indicated that, at present, they do not intend to enter into such an agreement and do not require a decision on the efficacy of such an agreement. [8] The effect of the above finding is that, in the ordinary run of events, two court cases would be required to complete the full process relating to the restoration of land under the Restitution Act if the compensation payable to the owner of the land to be restored, is in dispute. In the first court case, an order would be made against the State to expropriate the land in order to restore it to the claimant. Thereafter and pursuant to that order, the property would be expropriated. Upon such 7 8 In terms of Section 35(5) of the Restitution Act. Under section 22(1)(b) of the Restitution Act, this Court has jurisdiction: to determine or approve compensation payable in respect of land owned by or in the possession of a private person upon expropriation or acquisition of such land in terms of this Act 9 Under section 14(1)(c) of the Restitution Act, the parties may reach agreement as to how a claim should be finalised. Furthermore, if determine in subsection 22(1)(b) of the Restitution Act [quoted in the previous note] also relates to acquisition, it may be possible for the parties to sign a deed of sale and leave it to the Court to fix the price in terms of an agreement between them as to how the claim may be finalised.

6 6 10 expropriation, the claimant would become the owner of the land. Unless the compensation offered upon referral, was acceptable to the previous owner, he or she would then institute a second court case for the determination of the compensation payable by the State pursuant to the expropriation. 11 The process is unduly cumbersome and one which might well merit legislative amendment. In passing, I might point out that a case where the only matter in dispute is the amount of compensation which would become payable to the owner upon expropriation of the land, could be referred to the Court as a settled matter under section 14(1)(c) of the Restitution Act. That dispute is not a dispute as envisaged in section 14(1)(b). Which Minister must effect an expropriation under the Restitution Act? [9] Under section 35(1)(a) read with 35(5) of the Restitution Act, this Court may order the State to expropriate land in order to restore it to a claimant. If this Court does so, the Minister shall expropriate such land... in accordance, mutatis mutandis, with the provisions of the 12 Expropriation Act, 1975". The expropriation which has to take place must have a legislative foundation. 13 To which minister does the subsection refer and what power does that minister have to perform an expropriation? The term Minister is defined in the Restitution Act to be, unless the context indicates 14 otherwise, the Minister of Land Affairs. The Expropriation Act defines Minister as the Minister Section 42A(1) of the Restitution Act. Section 35 of the Restitution Act read with section 14(1) of the Expropriation Act. Section 35(5) of the Restitution Act Joyce and Mcgregor Ltd v Cape Provincial Administration 1946 AD 658 at 671; Central SA Railways v Geldenhuys Main Reef Gold Mining Co Ltd 1907 TH 270 at 279. Section 1 of the Restitution Act.

7 7 15 of Public Works. Authority to expropriate under the Expropriation Act is vested in the Minister of Public Works. The Minister of Land Affairs is not given any such power under the Expropriation Act. An indication that the Minister of Land Affairs might have been given such power under the Restitution Act is to be found in the words the Minister shall expropriate in section 35(5) thereof, 16 if that reference is indeed a reference to the Minister of Land Affairs. In addition, the words in accordance, mutatis mutandis, with the provisions of the Expropriation Act might indicate that the Minister envisaged by the legislature is the Minister of Land Affairs; if not, the words mutatis mutandis in the subsection could be redundant. [10] In the proceedings presently pending before this Court, an order is sought that the State must expropriate the property in order to restore it to the claimant. When granting such an order, this Court will not be concerned with which Minister actually performs the act of expropriation. Any uncertainty as to which Minister it should be, falls out of the ambit of the present proceedings. Even 17 if it is assumed that the agreement reached at the conference on 28 October 1998 brings it within the ambit of these proceedings, the Department (who has raised the question) faces the further difficulty that the Minister of Public Works [who, depending on the interpretation of section 35(5), may have to perform the act of expropriation] is not a party to these proceedings. Mr Goosen, who appeared on behalf of the Department, very properly conceded that the Minister of Public Works has a direct and substantial interest in an application for declaratory order that the Minister of Land Section 1 of the Expropriation Act. There are some exceptions, which are not relevant for purposes of this judgment. If the reference to Minister in section 35(5) of the Restitution Act is indeed a reference to the Minister of Land Affairs, it is curious why the legislature omitted to give that Minister more explicit powers of expropriation (other than the words the Minister shall expropriate ). A possible explanation can be found in the definition of Minister in the Expropriation Act. Before the definition was amended by Proclamation No R41 of 1994 dated 25 March 1994, Minister meant the Minister of Land Affairs and Public Works. When the new government came to power in 1994, different Ministers were appointed for Land Affairs and for Public Works. After some delay, responsibility for the Expropriation Act was given to the Minister of Public Works. When the Restitution Act was drafted, the drafters may have thought that the Minister of Land Affairs already had jurisdiction under the Expropriation Act to expropriate land, and for that reason did not include any specific authority in the Restitution Act. See para 3 above.

8 8 Affairs is empowered by section 35(5) of the Restitution Act to exercise all the powers conferred upon the Minister of Public Works by the Expropriation Act in relation to the expropriation of land ordered in terms of section 35(1)(a) read with section 35(5) of the Restitution Act. Because the Minister of Public Works is not a party to these proceedings, Mr Goosen did not press for an order in the above regard. In consequence, I will not make any decision on item 2 of the list of issues 18 referred to this Court for prior adjudication at the conference on 28 October Which court must determine compensation for an expropriation under the Restitution Act? [11] This Court may order the State to expropriate land in order to restore it to a claimant under section 35(1)(a) read with section 35(5) of the Restitution Act. If it does so, which court must 19 determine the compensation: the High Court or this Court? Section 22(1)(b) of the Restitution Act is relevant. It reads as follows: 22(1) There shall be a court of law to be known a the Land Claims Court which shall have the power, to the exclusion of any court contemplated in section 166(c), (d) or (e) of the Constitution - (a)... ; (b) to determine or approve compensation payable in respect of land owned by or in possession of a private person upon expropriation or acquisition of such land in terms of this Act; [12] An expropriation for purposes of restoring land under the Restitution Act must take place 20 pursuant to an order made against the State by this Court. Such an order brings that expropriation See para 3 above. The High Court determines the compensation payable in respect of expropriations under the Expropriation Act. See Section 14(1) of the Expropriation Act. Section 35(5) of the Restitution Act

9 9 within the purview of the Restitution Act, in which event this Court will have exclusive jurisdiction under section 22(1) of the Restitution Act to determine the compensation. Order [13] For the reasons set out above, the Court decides as follows on the three issues set out in para 3 above: (a) This Court has no jurisdiction to determine the compensation in respect of an expropriation pursuant to an order under section 35(1)(a) read with section 35(5) of the Restitution of Land Rights Act, 1994, before the expropriation has actually taken place. (b) This Court makes no decision at this stage on whether the Minister of Land Affairs is empowered to exercise the powers conferred on the Minister of Public Works by the Expropriation Act, 1975, in relation to the expropriation of land ordered in terms of section 35(1)(a) read with section 35(5) of the Restitution of Land Rights Act, (c) This Court has exclusive jurisdiction to determine the compensation in respect of an expropriation pursuant to an order made by this Court in terms of section 35(1)(a) read with section 35(5) of the Restitution of Land Rights Act, 1994, after the expropriation has taken place. [14] The parties have agreed that, should this Court decide that it has no jurisdiction to determine the compensation in respect of an expropriation pursuant to an order under section 35(1)(a) read with section 35(5) of the Restitution Act before the expropriation has actually taken place, the orders set out hereunder should be made. Consequently, it is ordered, by agreement between the parties -

10 10 (a) that portion 7 of the farm Klipheuvel No 549, as held under title deed number T92311/94, be restored to the Farmersfield Communal Property Trust registered with the Master of the High Court, Eastern Cape Division under reference IT1073/97; (b) that the State must, within a reasonable time, expropriate portion 7 of the farm Klipheuvel No 549 in order to restore it to the Farmerfield Communal Property Trust; (c) that in the event of the Registrar of Deeds (Cape Town) having made any note in his or her records in respect of the property in terms of section 11(6)(b) of the Restitution of Land Rights Act prior to its amendment by section 5(c) of Act No 78 of 1996, he or she is hereby directed to expunge it from such records, if he or she has not already done so. (d) that no order is made in respect of costs relating to : - the order of restoration in 14(a) and (b) above; and - the proceedings relating to the decisions made in 13(a), (b) and (c) above. (e) that the question of costs incurred in these proceedings insofar as it relates to the determination of compensation, is reserved for decision in subsequent proceedings pursuant to section 35(5) of the Restitution of Land Rights Act, 1994; failing that, any party is granted leave to set the matter down for such a decision. [15] It is recommended to the Minister of Land Affairs that the Farmerfield Communal Property Trust be given priority access to State resources in the allocation and development of housing and land in any development program relating to portion 7 of the farm Klipheuvel No This recommendation is made by consent of all the parties (including the Department of Land Affairs). The power which the Court previously had under section 35(1)(d) of the Restitution Act to make such an order, has been revoked by the subsequent amendment of that subsection (the (continued...)

11 11 JUDGE A GILDENHUYS I agree JUDGE A DODSON Heard on: 4 November 1998 Handed down on: 23 November 1998 For Department of Land Affairs: Adv G G Goosen instructed by State Attorney, Port Elizabeth For the claimants: Adv J Roos instructed by Legal Resources Centre, Grahamstown 21 (...continued) previous wording of the subsection was substituted by different wording in terms of section 25(a) of Act No 63 of 1997)