About # Reading List # Archive
If a commercial transaction is concluded with a person that holds a right issued by the Department of Mineral Resources (
the department) care must be exercised to ensure that the required regulatory approvals needed for the implementation of the transaction has been granted. Examples of commercial transactions that need ministerial approval in terms of the Mineral and Petroleum Resources Development Act (MPRDA) before they can be implemented include agreements that would result in:
To get consent to implement these transactions a formal application must be submitted to the department. Unfortunately, the legislation does not provide any maximum time limits that are applicable when considering the application. In most cases an application submitted to the department is approved without too much delay, but in some cases months, if not years, may pass without the application for consent being considered.
Delays in the approval process can have drastic consequences on commercial transactions because without the required consent they can't become effective and can't be implemented by the parties. What can a person do if there is a significant delay in the approval process after the application for ministerial consent has been submitted? The most common answer is for a person to bring an application to court, and ask the court to grant an order forcing the department to perform its duty. This court relief is referred to as a mandatory interdict, or a mandamus. In many situations this relief would be a sufficient; the matter is referred back to the department for consideration within a court specified time line.
The purpose of this article is, however, to explore alternate legal remedies that could be used if there is a significant delay in the approval process. Particularly, can a person bring a court application for a court order granting an application that was submitted in terms of the MPRDA, without the need to refer the matter back to the minister for consideration?
Any action taken by an organ of state must be (i) lawful; (ii) reasonable; and (iii) procedurally fair. If an action does not meet with these requirements a person who has been affected by the action has the right to approach a court to
review the infringing action, and ask the court for appropriate relief. This right of judicial review stems from the Constitution of the Republic of South Africa 1996 (the Constitution), and is given effect by the Promotion of Administrative Justice Act (PAJA) (in particular see section 33 of the Constitution).
Both actions and inactions of the government can be reviewed by a court. This is because an
administrative action is defined to include any decision taken, or the failure or refusal to take a decision, by an organ of state when exercising a public power or performing a public function in terms of legislation (the definition of
administrative action as read with the definition of
failure contained in section 1).
A court has wide powers when reviewing an administrative decision (see section 8 of PAJA). In cases where the government's administrative action amounts to the failure or refusal to take a decision, then the court may grant any order that it just and equitable, including an order:
Accordingly, if the minister fails to consider an application that has been submitted by a person in terms of the MPRDA, the ministers inaction will be
an administrative action, and falls within the ambit of PAJA. Under these circumstances a person should be able to approach the court for appropriate relief.
The right to approach a court directly for relief in terms of PAJA is, however, curtailed if the applicable legislation, such as the MPRDA, contains an internal appeal procedure (section 6(2)(g) and 7(2)(a) of PAJA).
A person's right to approach the court to review an administrative decision in terms of PAJA is not unlimited. A person can't approach a court until any internal appeal process in the applicable law, such as the MPRDA, has been exhausted (section 7(2)(a) of PAJA). It is intended that a person's first port of call should be the legislated internal appeal procedure. A person can only approach a court if the applicable act doesn't have an appeal procedure, or after the appeal procedure has been followed. Exceptions to this rule do, however, exist, and a person is entitled to approach the court directly without first exhausting the internal appeal procedure is there are
exceptional circumstances (section 7(2)(c) of PAJA).
To phrase these requirements differently, a court can be approached to review an administrative action if:
What is the correct legal process if the minister fails to consider an application that has been submitted by a person in terms of the MPRDA? This will depend on whether the MPRDA contains an internal remedy that can be relied on when the minister fails to take any action.
Is there an internal appeal in situations where the minister fails to take a decision, or does the internal appeal procedure in the MPRDA only apply to decisions that have actually been taken? Is it correct to argue that the internal appeal procedure must be followed in a situation where the minister fails to make a decision in terms of the MPRDA?
If the internal appeal procedure doesn't apply to a failure to take a decision then there will be no requirement to institute an internal appeal. In these circumstances a person will be entitled to approach the court immediately without having to prove that there are exceptional circumstances that allow the court to exempt the person from the internal appeal requirements.
In order to answer this question the internal appeal procedure that is set out in the MPRDA must be examined.
The MPRDA has an internal appeal process that can be relied on in some circumstances (section 96). This internal appeal process can be summarised as follows:
administrative decisionof the department until they have exhausted the remedies set out in the MPRDA (section 96(3)).
administrative decision, may appeal within 30 days of becoming aware of such administrative decision (section 96(1)), setting out:
As discussed, a person does not have the right to approach a court to review any administrative action unless any internal appeal procedure in the MPRDA has been exhausted or unless there are exceptional circumstances that allow the court to exempt the person from the internal appeal requirements.
The MPRDA does have an internal appeal process (section 96), but does the MPRDA's internal appeal procedure apply in situations where the minister fails to take a decision?
administrative action is defined in PAJA to include the failure to take a decision, but the MPRDA's appeal procedure doesn't use this term. The MPRDA's internal appeal procedure states that it applies to
administrative decisions, a term that is not defined.
The wording and context of the internal appeal procedure supports a conclusion that the term
administrative decision can only relate to decisions that have actually been taken, and doesn't apply to a failure to take a decision:
decision takenmust be taken within a reasonable time, must be in writing, and must be accompanied by written reasons for the decision (sections 6(1) and (2)). In a situation where the minister has failed to consider an application there will be no
decisiontaken. This non-decision is not capable of being reduced to writing, and similarly it will not be possible to give any reasons for the non-decision.
was taken(section 96(1)(b)). The language of the section clearly implies that there must have been some form of act by the minister, not just a failure to take a decision.
written reasons for the administrative decision.
The conclusion that the term
administrative decision can only relate to decisions that have actually been taken, and not to a failure to take a decision, can also be demonstrated by considering what the final appeal procedure could be if the term
administrative decision did include the failure to take an action.
administrative decisionin terms of the MPRDA? Would a person be prevented from applying to a court to review the failure to consider the appeal until the internal remedies in the MPRDA have been exhausted, requiring the appellant to lodge a second internal appeal against the ministers failure to determine the first appeal (section 96(3))?
This process is a far cry away from that an internal appeal process should achieve; a quick and cost effective method to resolve irregularities before instituting legal action.
I would submit that the term
administrative decision in terms of the MPRDA has a narrower definition than
administrative action under PAJA, and that this term should not be interpreted to include situations where there has been a failure to take a decision, but only to include situations where a decision has indeed been taken which is prejudicial.
Even if the above argument is rejected, PAJA allows a person to bypass any applicable internal appeal process if there are exceptional circumstances that would allow the court to exempt the non-compliance with the internal appeal procedure (section 7(2)(c)). It would be prudent for any person who wants to bring a court action without first lodging an internal appeal to ask the court to grant an exemption from having to lodge in internal appeal, as an alternative to the argument that there is no internal appeal.
exceptional circumstances that are typically accepted by the courts when granting an exemption from complying with internal appeal procedures are discussed in the next section.
If the minister ignores an application that has been submitted and does not consider it at all, an affected person will be able to approach the court in terms of PAJA directly without first exhausting the internal appeal procedure because the internal appeal procedure will not be applicable in these circumstances. As an alternative, an affected person can ask the court for an exemption from the internal appeal process if there are exceptional circumstances that are applicable.
An affected person can approach the court as soon as there has been an unreasonable delay in taking a decision (sections 6(2)(g) and 6(3)(a) of PAJA). It is possible to ask the court to grant any order that it just and equitable (section 8(2) of PAJA), including an order:
There has been a lot of recent discussion about the legal doctrine of the separation of powers; how the courts (judiciary) should not overstep its role and perform acts that fall into the realm that should be occupied ministers (the executive). PAJA does, however, directly empower the court to come to the aid of a person when the executive acts unlawfully, and allows the court to effectively make a decision on behalf of the minister when the minister fails to take a decision in a reasonable time (see sections 8(1)(c)(ii)(aa) and 8(2)(a) of PAJA; de Ville, JR. 2003. Judicial Review of Administrative Action in South Africa. Durban: LexisNexis Butterworths, at pg. 370; Hoexter, C. 2012. Administrative Law in South Africa. Cape Town: Juta, at pg. 552).
There are four situations where a court will be prepared to substitute its decision with the decision of the minister, without referring the matter back to the minister for decision. These are:
For many applications the MPRDA doesn't allow the minister to use any discretion when considering the application. The power granted to the minister is not a discretionary power; the minister must grant consent if the requirements for transfer are complied with. If the requirements are met the result is a forgone conclusion; the minister must grant the application.
Applications where the minister is compelled to grant a compliant application include applications for consent to transfer a right (section 11(2)), applications for prospecting rights (section 17(1)) and applications for mining rights (section 23(1)).
For these categories of applications it can be argued that, (i) the court is as qualified as the minister to make the decision, and (ii) that the end result of the application is a foregone conclusion. Once the court has had the opportunity to review and consider the application that was submitted, the court will be as well qualified as the minister to determine if the application placed before it meets the objective criteria the applicable section, and grant the application if all the requirements are met.
In addition to meeting these two requirements for substitution of a decision by the court, a person may also be able to advance reasons to show the court that further delay will cause unjustifiable prejudice.
Based on these considerations I submit that a person would be entitled to approach a court for direct relief and ask the court to substitute its decision with the minister's decision.
What should be done if an application has been submitted to the Department of Mineral Resources, and the department has failed to take any action or consider the application?
Note: For more reading on the topic of substitutionary relief, you can read my discussion on the SCA's decision in the Aquila case here (which then later went on appeal to the Constitutional Court).
Prev # Next
Copyright Notice # Legal Disclaimer