Case Law[2025] ZAGPPHC 282South Africa
Berties Van Zyl (Edms) BPK (t/a ZZ2) and Others v Product Control for Agriculture and Another (021530/2022) [2025] ZAGPPHC 282 (17 March 2025)
High Court of South Africa (Gauteng Division, Pretoria)
17 March 2025
Headnotes
thereof. [12] Because the Memorandum (which purports to set out the methodology applied by Prokon to determine inspection fees to be charged) required a detailed study, the first applicant objected that a week' notice was inadequate under the circumstances. The first applicant also expressed a desire to secure legal representation during the meeting, given the history of the subject-matter.[3]
Judgment
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# South Africa: North Gauteng High Court, Pretoria
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## Berties Van Zyl (Edms) BPK (t/a ZZ2) and Others v Product Control for Agriculture and Another (021530/2022) [2025] ZAGPPHC 282 (17 March 2025)
Berties Van Zyl (Edms) BPK (t/a ZZ2) and Others v Product Control for Agriculture and Another (021530/2022) [2025] ZAGPPHC 282 (17 March 2025)
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sino date 17 March 2025
IN THE HIGH COURT OF
SOUTH AFRICA
GAUTENG DIVISION,
PRETORIA
CASE
NO: 021530/2022
(1)
REPORTABLE:
NO
(2)
OF INTEREST TO OTHER JUDGES:
NO
(3)
REVISED:
YES
(4)
Date: 17 March 2025
Signature:
In
the matter between:
BERTIE
VAN ZYL (EDMS) BPK
(T/A
ZZ2)
First
Applicant
TOMATO
PRODUCERS’ ORGANISATION
Second Applicant
NOORDELIKE
UIE KOMITEE (PTY) LTD
Third Applicant
KORKOM
POTATOES AND ONIONS
Fourth Applicant
LEBOMBO
GROWERS (PTY) LTD
Fifth Applicant
CITRUS
GROWERS ASSOCIATION OF SOUTHERN AFRICA
Sixth Applicant
And
PRODUCT
CONTROL FOR AGRICULTURE
First Respondent
THE
MINISTER OF AGRICULTURE, FORESTRY
&
FISHERIES
Second Respondent
JUDGMENT
NYATHI
J
A.
Introduction
[1]
The Agricultural Products Standards Act 119 of 1990 (“the Act”)
provides for control over the sale and export of certain agricultural
products by an officer in the service of the Department of
Agriculture (“the executive officer”). The Act also
empowers the Minister to designate any person having particular
knowledge in respect of an agricultural product, as assignee in
respect of that product (Section 2(3)(a)). An assignee thus
designated,
exercises subject to the directions and control of the
executive officer, the powers of the executive officer in respect of
that
product (Section 2(3)(b)).
[2]
The first respondent, Product Control For Agriculture (“Prokon”),
was designated as assignee in terms of Section 2(3)(a) of the Act. In
discharging its duties as assignee, Prokon performs inspections
on
fresh fruit and vegetables to ensure compliance with the applicable
regulations pertaining to the grading, packing and marking
of such
fresh produce.
[3]
Assignees are entitled in terms of Section 3(1A) to determine and
charge fees
in respect of their services. Accordingly, Prokon
determined its fees which it published on 11 March 2022 (hereinafter
“Prokon’s
Fee Determination”).
[4]
The first applicant (“ZZ2”) who is a producer of products
listed
in the Fee Determination and the Second to Fifth applicants
whose members are also producers of certain listed products, seek the
review and setting aside of Prokon's Fee Determination.
[5]
Prokon’s Fee Determination constitutes administrative action,
and the
applicants contend that such determination was unlawful and
falls to be reviewed and set aside.
B.
Applicants’ contentions
[6]
On 6
January 2017 Prokon published its initial fees in respect of the
inspection services rendered by it. The first applicant (ZZ2)
and
others brought an application to review and set aside Prokon's
determination of its initial fees. After four years of
litigation, ZZ2 and its co-applicants were ultimately successful in
their review based on the isolated ground that the notice and
comment
procedure followed by Prokon was flawed.
[1]
[7]
Following Prokon's second fee determination, published on 11 March
2022, ZZ2
and the other applicants have followed the same
modus
operandi
as in the earlier application. They waited just under
six months before launching this second review application, again
applying
for Prokon's fee determination to be reviewed and set aside.
C.
The purpose of the application
[8]
The Applicants contend that Prokon’s Fee Determination was
unlawful, unreasonable
and procedurally unfair. They seek to have the
Fee Determination reviewed and set aside as contemplated in section 7
of the Promotion
of Administrative Justice Act 3 of 2000 (“PAJA”)
because:
8.1
Prokon’s Fee
Determination is ultra vires the provisions of Section 3(1A) read
with Section 3A(1)(c) of the APS Act;
8.2
Prokon's fee determination
was procedurally unfair in that Prokon deprived interested parties of
the opportunity to comment meaningfully
on a number of material
issues; and
8.3
Prokon determined its fee in
a manner that is irrational and/or arbitrary and/or capricious and/or
Prokon's decision was not rationally
connected to the purpose for
which it was taken.
D.
Prokon’s contentions and conditional
counter-application:
[9]
Prokon denies the contentions by the applicants above and avers that:
9.1
the review application is an
abuse of process;
9.2
that the applicants have an
internal remedy that they ought to have exhausted first; and
9.3
that in any event, the
review application was not brought within a reasonable time.
[10]
Prokon also brought a Conditional Counterapplication wherein it
seeks, in the event of the Court upholding
any of the Applicants'
complaints and electing to declare Prokon's Fee Determination
invalid, that such a declaration of invalidity
be suspended pending
finalisation of a new fee determination process. The Applicants
oppose Prokon's Conditional Counter Application.
This issue must also
be determined.
E.
Genesis of Prokon’s second fee determination from ZZ2’s
perspective
[11]
On 14
September 2021, Prokon invited the first applicant to participate in
a virtual meeting on 21 September 2021 “to discuss
Prokon's
application for the promulgation of new inspection fees on regulated
fresh fruit and vegetables”.
[2]
The invitation referred to a ‘Memorandum in respect of the
Determination of New Inspection Fees on Regulated Fresh Fruits
and
Vegetables’ that was available on Prokon’s website
together with a summary thereof.
[12]
Because the
Memorandum (which purports to set out the methodology applied by
Prokon to determine inspection fees to be charged)
required a
detailed study, the first applicant objected that a week' notice was
inadequate under the circumstances. The first applicant
also
expressed a desire to secure legal representation during the meeting,
given the history of the subject-matter.
[3]
[13]
In
response to the first applicant’s objection, Prokon wrote back
stating that the purpose of the meeting would be “purely
and
simply to explain the methodology implemented by Prokon in the
determination of its fees” and that adequate opportunity
to
comment would be provided after the proposed fees have been
published.
[4]
[14]
During the virtual meeting on 21 September 2021, which was attended
on behalf of the first applicant,
Mr Booysen (who is Prokon's Chief
Executive Officer) summarised the contents of the Memorandum by way
of a Power Point presentation.
A copy of the Power Point presentation
(that was mailed to participants prior to the meeting together with
an Agenda), is attached
as Annexure FA6. A copy of the agenda is
attached as Annexure FA7.
[15]
Mr Booysen thereafter invited the participants to participate in a
question-and-answer session. Mr
van Straaten (who represented the
Pineapple Growers Association, asked Mr Booysen if a 20-ton
consignment is received on the market,
but only 10 tons are
inspected, will the inspection fees be charged on the total
consignment or only on the kilograms inspected.
Mr Booysen gave the
following answer:
'A:
An inspection is conducted as per consignment as specified in the Act
and the regulations. If a consignment consists of the
same cultivar,
same class, same size and comes from the same farmer it is regarded
as a single consignment and the inspection fee
will apply to the
total consignment, notwithstanding the fact that only 10 tons were
inspected’.
[16]
Ms Rademeyer (who represented the first applicant) objected that
insufficient time was allowed to prepare
for the Zoom meeting and
that it will comment at a later stage. The Chairperson Dr T Mutengwe
who represented the Minister, then
proposed that interested parties
be given until 5 October 2021 to comment and this proposal was
accepted by those present.
[17]
In a letter dated 23 September 2021, Mr Bernhard Van der Hoven who is
ZZ2's attorney, drew the attention
of Prokon's attorneys to the fact
that when ZZ2 objected to the short notice given for the meeting,
Prokon answered that the purpose
of the meeting was only to explain
the methodology implemented by Prokon in the determination of its
fees. Mr Van der Hoven requested
Prokon to explain why Prokon
deviated from the stated purpose of the meeting and if the
question-and-answer session was intended
to serve as public
participation process. A copy of Mr Van der Hoven's letter is
attached as Annexure FA9.
[18]
On 5 October 2021, Prokon extended the date for submissions to
Wednesday 13 October 2021. A copy of
the Notice is attached as
Annexure FA11.
[19]
The first applicant did comment on the proposed inspection fees. A
copy of Mr van der Hoven’s
letter dated 13 October 2021 with
the comments attached fees on the following two grounds:
19.1
Prokon based its fees on the
weight of products without justifying that it would cost more to
inspect products with a higher weight
per unit compared to those with
a lower weight;
19.2
Prokon does not justify that
“own regulated products inspections cost 50% more than shared
regulated products inspections”.
[20]
In their reply to the first applicant's comments, Prokon's attorneys
invited the former to attend a
further meeting during which the
calculation of the fees will be explained. A copy of the letter dated
22 October 2021 is attached
as Annexure FA13.
[21]
The first applicant accepted Prokon's invitation to attend the
meeting notwithstanding the fact
that it had become clear that any
further explanation could not affect or change Prokon's view.
[22]
As pointed out, the first applicant did attend the follow up Zoom
meeting held on Wednesday 20 October
2021 at 10:00 to further discuss
the application for the promulgation of new inspection fees on
regulated fresh fruits and vegetables.
A copy of the Notice of the
meeting is attached as Annexure FA14.
[23]
On 5 November 2021 in Notice 646 of 2021 (Government Gazette 454/62),
Prokon published its proposed
inspection fees for public comment. A
copy of the Notice (hereinafter referred to as “Prokon’s
Notice of Proposed Fees”)
is attached as Annexure FA15.
[24]
Prokon’s Notice of Proposed Fees stated that its inspections
would apply to two specified categories
of products: (1) own
regulation products inspections and (2) shared regulation products
inspections. The products that fall into
each of these categories are
set out in a Table that also contains the inspection fee to be
charged in respect thereof:
24.1
For shared regulation
products: 1c/kg
24.2
For own regulation products:
1.5c/kg
[25]
Prokon’s Notice of Proposed Fees was accompanied by what Prokon
described as the methodology
applied to determine the inspection
fees. The Notice also stated that the full memorandum pertaining to
the proposed inspections
fees was available on Prokon's website.
[26]
After the publication of Prokon’s Notice of Proposed Fees and
its methodology, the applicants
more fully commented thereon, by way
of a letter written by Mr van der Hoven, attached to the papers as
Annexure FA16. The nub
of the applicants’ objections was:
26.1
Prokon intends to base its
inspection fees on the weight of a product without justifying that it
would cost more to inspect products
with a higher weight than those
that weigh less;
26.2
Prokon does not justify why
"own regulated products inspections cost 50% more than shared
regulated products inspections”.
26.3
Prokon did not meaningfully
consider alternative methods to determine its fees and in particular
the possibility of determining
its fees based on the time required
for the inspection;
26.4
No facts are provided why an
inspection twice per week would be required.
26.5
Prokon should consider the
possibility of conducting random inspections which would probably
allow it to render its services in
a more cost effective manner;
26.6
The classification into own
products and shared regulation products appears to be arbitrary and
it is not explained on what basis
own regulation products would
attract a higher fee; the arbitrariness of the classification appears
(amongst others) from the fact
that onions, shallots and tomatoes are
classified as own regulation products and which would require a
determination if these products
are seeded or seedless, deep cutting
to determine if split stone is present on stone fruits, determination
of sugar/starch ratio,
and destructive testing;
26.7
Prokon should rationally
consider the possibility of determining inspection fees with relation
to the time actually spent on the
inspection; the determination of
fees on this basis will result in producers of products that weigh
more (avocados, watermelons
etc) not being unfairly discriminated
against;
26.8
Prokon does not indicate if
fees will be calculated with reference to product actually inspected
and the weight thereof or if fees
will be determined per total weight
of the consignment delivered by the producer;
26.9
Inspections would be done
only at markets in the bigger metropoles; it is not explained why
inspections are required at these venues
under circumstances where
markets had already inspected the quality, grading, packing etc of
the produce put up for sale; Prokon
does not intend to exercise its
statutory duties in smaller municipalities and in rural areas,
thereby depriving the general public
of the benefits of the Act;
Prokon's entire funding model appears to be flawed as a result.
[27]
On 10 December 2021, Prokon thanked the first applicant for
responding to its invitation to comment
on the proposed inspection
fees and stated that it was in the process of evaluating the response
and will communicate with it again.
A copy of the letter is attached
as Annexure FA17.
[28]
Prokon
followed-up with a letter dated 27 January 2022 (Annexure FA18),
wherein it rejected the applicants’ objections that
fees should
not be charged per kilogram.
[5]
Prokon asserted that the Memorandum on its website provided
stakeholders with sufficient information as to how the inspection
fees were determined
[6]
.
[29]
Prokon also confirmed that after consideration of the comments
received from industry stakeholders
“against explanations
provided in the methodology document” it shall persist with its
proposal that there would be
2 categories and a difference in
inspection fees (Paragraph 3).
[30]
Prokon also insisted that inspections would be conducted at the most
appropriate frequency, point and
time to ensure that the inspection
service remains cost effective and to ensure that Prokon who operates
on a costs recovery basis,
provide an inspection service in terms of
its mandate as assignee (paragraph 4).
[31]
Finally, Prokon stated that inspections would not be limited to fresh
produce markets in the bigger
metropoles and will be conducted on
different fresh produce markets and at retail level (paragraph 9).
[32]
Prokon then published the fees it imposed in terms of Section
3(1A)(a)(ii) of the APS Act on 11 March
2022 in GN 877 of 11 March
2022 in Government Gazette 46032. A copy of Prokon's Inspection Fees
is attached as Annexure FA19 (hereinafter
‘Prokon's Fee
Determination').
[33]
The applicants’ eventual response was to launch this review
application. Before I set out the
formal grounds for the review as
laid out in the application, I propose to deal with the 2 points
in
limine
that were raised by the Prokon.
F.
The points in limine
[34]
Prokon alleges that this review application is an abuse of process
because:
34.1
the applicants have failed
to exhaust internal remedies before resorting to the courts. And
34.2
the application was not
brought within a reasonable time as envisaged by Section 7 of PAJA.
34.3
For these reasons, it was
submitted on behalf of Prokon, the applicants are non-suited.
[35]
This review application is a sequel to the earlier application which
culminated in the Supreme Court
of Appeal judgment reported as
Bertie
Van Zyl (Pty) Ltd t/a ZZ2 and Others v Minister of Agriculture,
Forestry and Fisheries and Others
(549/2020)
[2021] ZASCA 101
(14
July 2021). The main bone of contention here, as in the instant case
was the first Fee Determination by Prokon. In that case,
the failure
to exhaust internal remedies as provided by section 10 of the Act,
was dealt with and disposed of. UNTERHALTER JA writing
for a
unanimous bench, held that:
“…
Given
these uncertainties, in my view, the failure by the appellants to
appeal under s 10(1), even if this was an available remedy,
should
not frustrate the appellants’ review. Where the right to appeal
is not made plain in the legislation, and, at best,
it is cast as a
right and not an obligation, the high court should have permitted the
appellants, in the interests of justice,
to proceed with their
review. And I do so find.”
[36]
The second
objection by Prokon is that the applicants “…waited just
under six months before launching this second review
application,
again applying for Prokon’s fee determination to be reviewed
and set aside.”
[7]
It was
submitted on behalf of the applicant that the application was filed
on 2 September 2022, which is 5 months and 20 days after
the
date of the fee determination, which is before the lapse of 180 days
provided for in PAJA.
[37]
In
Valor
IT v Premier, North West Province and Others
[8]
,
it was
held that
“
Whether
a delay is unreasonable is a factual issue that involves the making
of a value judgment. Whether, in the event of the
delay being
found to be unreasonable, condonation should be granted involves a
‘factual, multi-factor and context-sensitive’
enquiry in
which a range of factors – the length of the delay, the reasons
for it, the prejudice to the parties that
it may cause, the fullness
of the explanation, the prospects of success on the merits –
are all considered and weighed before
a discretion is exercised one
way or the other”.
[38]
With these views being pondered, it follows that the points in limine
cannot prevail.
[39]
I proceed to deal with the merits of the applicants’ review
application.
G.
THE GROUNDS FOR REVIEW OF PROKON’S FEE DETERMINATION
Prokon’s
Fee determination was
ultra vires
the Act
[40]
Section 3(1A)(a) of the Act provides that fees may be charged in
respect of the powers exercised and
duties performed by the executive
officer of the assignee (as the case may be), “to ensure
compliance with this Section”.
[41]
Section 3(1A)(b) further particularises that, in the case of powers
exercised and duties performed
by the executive officer, the
prescribed fee shall be payable. Where the assignee has exercised the
powers and performed the duties,
the fee determined by such assignee
shall be payable.
[42]
The Applicants argue that as a result, Section 3(1A)(a) should be
read with and is qualified by what
is set out in Section 3(1A)(4):
fees may be charged in respect of the powers exercised and duties
performed by the executive officer
of the assignee to ensure
compliance with Section 3 of the Act but the owner shall be liable to
pay such fee only if the executive
officer or an assignee performed
an action contemplated in Section 3A(1)(b), (c), (d) or (e). Only
then '...the owner of the product
in question shall pay the
prescribed fees or the amount determined by the assignee, as the case
may be, for such action.'
[43]
The purpose
of the Act is to compensate the executive officer or an assignee for
services rendered that will have some value to
the owner. In
Bertie
Van Zyl (Pty) Ltd t/a ZZ2 v Minister of Agriculture, Forestry and
Fisheries
[9]
the SCA stated as follows:
“
[9] …The
Act permits fees to be charged in respect of the powers exercised and
the duties performed by executive officers
and assignees. The fees
are charged for the service rendered by executive officers and
assignees. Owners thus receive consideration
for the payment of fees
– the inspection of their products to ensure that they may be
sold in compliance with the Act…”
[44]
The applicants submitted that, on a proper interpretation of Section
3(1A)(a)(ii) read with Sections
3A(1) and 3A(4) of the Act:
44.1
an assignee has the power,
and the owner has the duty to pay the fee determined by the assignee
to compensate the assignee for the
exercise of its powers and the
performance of its duties set out in Section 3A(1)(b) — (e);
and
44.2
an assignee has no power to
charge a fee unless such fee is charged in respect of an action taken
in respect of a quantity of a
product as contemplated in Section
3A(1)(b) — (e),
[45]
Prokon calculated its inspection fees on the basis that it would be
entitled to charge the owner per
consignment. In other words,
Prokon's Fee Determination allows it to inspect a random number of
products in a consignment and then
require the owner of a product to
pay for such inspection and in addition thereto, a fee on the
uninspected products merely because
these products were present at
the place where Prokon conducted its inspection.
[46]
As a result, Prokon’s Fee Determination obliges an owner to pay
an assignee not only for actions
undertaken as contemplated in
Section 3A(1)(b) – (e), but also an additional amount that
would constitute a levy or a tariff
imposed by Prokon on owners of
products.
[47]
Prokon is not entitled to charge a levy or to impose a tariff on
owners. It cannot charge a fee for
services not actually rendered: in
terms of Section 3(1A) read with Section 3A(1)(c), Prokon may only
charge a fee in respect of
an action it in fact did perform.
[48]
Prokon’s Fee Determination is clearly
ultra vires
the
provisions of Section 3(1A)(a)(ii) read with Sections 3A(1) and 3A(4)
of the Act. Its Fee Determination falls to be reviewed
and set aside
on this ground alone.
[49]
In
Pharmaceutical
Manufacturers Association of SA:
In re Ex
parte President of the Republic of South Africa and others
[10]
decision of the Constitutional Court, Chaskalson P explained the
principle of legality in the constitutional era as follows:
“
[50] What would
have been ultra vires under the common law by reason of a functionary
exceeding a statutory power is invalid under
the Constitution,
according to the doctrine of legality."
Prokon’s
Fee Determination was procedurally unfair
[50]
Prokon decided to follow a notice and comment procedure and in terms
of Section 4(3)(a) of PAJA, Prokon
had to take appropriate steps to
communicate the administrative action to those likely to be
materially and adversely affected
by it and call for comments from
them.
[51]
The
applicants contend that Prokon fell short of what it was obliged to
do in that it failed to provide interested parties with
sufficient
information concerning material aspects of its proposed
administrative action to enable them to submit meaningful
comments.
[11]
[52]
Prokon did not comply with these statutory obligations and thus
deprived interested parties of the
opportunity to comment
meaningfully on material issues concerning its proposed inspection
fees. These were the frequency of inspections
they decided upon, the
method of categorization of products and their pricing as well as
Prokon’s failure to make material
documentation which it relied
upon available. These were guidelines by the Organisation for
Economic Cooperation and Development
(‘OECD’).
[53]
This deprivation of material documentation appears to be a repeat of
an earlier oversight which caused
the SCA in the earlier appeal
matter of
Bertie van Zyl
to comment as follows:
“…
What
was required of Procon in the notices calling for comment was
information as to the basis of a fee based on weight, the rationale
for the fee structure, the logic underpinning the categories, rate
differentials and their relation to cost recovery.
[32]
Absent this information, those affected by the proposed fee
determination, including the appellants, were
not placed in a
position to make meaningful and informed comments. As a result, the
consultative process did not meet the requirements
of procedural
fairness. The fee determination made by Procon cannot stand, since it
is the outcome of an unfair process. It must
be reviewed and set
aside.”
[12]
[54]
The applicants alleged that Prokon again fell short of what
Regulation 18(3) requires. It failed to
provide the general public
with sufficient information relating to the rationale and logic
underpinning the frequency of inspections,
the categorisation of
products into the applicable two categories, the rate differentials
and their relation to cost recovery.
[55]
In the
circumstances, Prokon’s Fee Determination was procedurally
unfair. It falls to be reviewed and set aside as being procedurally
unfair as well.
[13]
Irrationality
and/or arbitrariness:
[56]
Prokon determined the fees in a manner that is irrational and/or
arbitrary and/or capricious and/or
Prokon's decision was not
rationally connected to the purpose for which it was taken.
[57]
In
Pharmaceutical
Manufacturers Association of SA and Another: In re Ex parte President
of the Republic of South Africa
[14]
the Constitutional Court held that for the exercise of public power
to be valid, a decision taken must be rationally connected
to the
purpose for which the power was conferred.
[58]
Quite
recently, in
Minister
of Water and Sanitation v Sembcorp Siza Water (Pty) Ltd,
[15]
the Court re-affirmed that an irrational decision will be set aside,
stating:
“
[47] But
it bears emphasis that there is a distinction between irrationality
relating to the decision itself and irrationality relating to the
procedure leading up to that decision. The presence of
each of
them is fatal to the exercise of power. If the procedure
followed is such that it could not result in achieving the
purpose
for which the power was conferred, the purported action must be set
aside. The same result must follow if the decision
taken would
equally not lead to the attainment of that purpose.”
[59]
The
Constitutional Court emphasised the caution that rationality in so
far as the exercise of public power revolves on whether there
was a
rational connection between the decision taken or procedure followed,
and the purpose for which the power was granted. If
there is such a
connection, the review challenge based on this ground must fail.
[16]
[60]
The thrust of the applicants’ objection against Prokon’s
fee determination as being not
rationally connected to the purpose
for which it was taken comes from two angles, namely, Prokon’s
basing of inspection fees
on the
weight of produce inspected
per
kilogram and the
categorisation of inspection fees into shared
regulations and own regulations.
[emphasis added].
60.1
The applicants submit that
the agricultural products that fall in each of the two categories
(shared regulations and own regulations)
differ greatly in respect of
weight and size and it behoves no argument that the fees payable
following an inspection of a consignment
of water melons (1c per kg),
would be considerably more than an inspection of a consignment of
garlic (1.5c per kg), chillies (1c
per kg) or parsnip (1c per kg),
for example.
60.2
The outcome of charging per
weight of the product in this is a higher fee being payable by owners
of products that weigh more and
a lesser fee payable by owners of
products that weigh less. This is despite the fact that Prokon would
perform exactly the same
services in respect of both categories of
owners.
[61]
Realising
that Prokon’s fee determination was riddled with the same
difficulties as was the case with its earlier determination
of 6
January 2017, which was reviewed and set aside in the SCA decision
Bertie
van Zyl
,
the applicant brought this to the attention of the respondent.
[17]
[62]
Prokon again based its Fee Determination on the weight of the
product. Prokon has thus brazenly ignored
the SCA's clear finding and
did so despite the first applicant's objections.
[63]
The SCA had made it clear, that the determination of a fee per
consignment based on the weight thereof
per kilogram, would be
arbitrary and cannot rationally be linked to the costs incurred by
Prokon in exercising its powers and performing
its duties
contemplated in Section 3(1) read with 3A(1)(b) to (e) of the APS
Act.
The
categorisation of inspection fees into shared regulations and own
regulations:
[64]
In its Fee Determination, Prokon motivated the inclusion of products
into the two categories (own regulation
inspections and shared
regulation inspections) on the basis of
'the extent of the
resources (labour finances etc) allocated for conducting the
inspections'.
[65]
In its
answering affidavit, Prokon elaborately explains the categorisation
of products into these categories and the imposition
of a higher
inspection fee in respect of one of these, on the basis that own
regulation products have specific regulations that
must be complied
with which results in own regulation products requiring more time,
labour and resources.
[18]
[66]
It is the applicant’s contention that Prokon has not complied
with its fee determination but
broadened the categories in its
answering affidavit by: Including cactus pears, figs, granadillas,
kiwi fruits, mangoes, persimmons,
pomegranates, watermelons and
melons in the category “shared regulation products”. This
is problematic because the
aforementioned fruits and vegetables have
each its own set of regulations containing restrictive and
prescriptive provisions
specifically with regard to each.
[67]
The
specificity of the provisions variously lays down methods of
inspection based on ripeness standards, maturity requirements and
quality.
[19]
As a result, and
applying Prokon’s criterion to use the labour and resources and
time spent on an inspection, the above listed
produce ought to be in
their own regulation category. Instead, and strangely, Prokon
included these fruits and vegetables on the
shared regulation
category.
[68]
In practice, the inspection time required for cactus pears, figs,
granadillas, kiwi fruits, mangoes,
persimmons and pomegranates would
be considerably more than what would be required for carrots, for
example. Yet, Prokon imposed
an inspection fee of 1c/kg in respect of
carrots and the same fee for cactus pears, figs, granadillas, kiwi
fruits, mangoes, persimmons,
pomegranates, watermelons and melons.
[69]
Prokon cannot explain this anomaly in the time and resources expended
on the inspection of the produce
in the foregoing example.
[70]
Prokon
has also sought to rely on a purported survey it belatedly conducted
during January and February 2022 to justify an increase
in inspection
fees in respect of own regulation products. That survey is manifestly
inaccurate however, as appears from random
examples
[20]
that were extracted and referred to by the applicant from said
survey. The discrepancies in the time it took inspectors to inspect
produce is astonishing, for example, On 3 February 2022 Mr Martin
Setswane required 135 minutes to inspect 29 carrots. On 13 January
2022, it took him only 12 minutes to inspect 28 carrots. There is no
explanation for the difference.
[71]
The unavoidable conclusion is that Prokon’s
categorisation of products into own regulation inspections and shared
regulations
inspections and the fee differential in respect of
produce falling into each category, is arbitrary and irrational.
Frequency
of the inspections:
[72]
Prokon
stated that a twice a week inspection of products optimises the
cost/inspection ratio, minimises cost and is sufficient to
ensure
that non-conforming produce do not reach the consumer.
[21]
[73]
Prokon stated that it based its decision that a
frequency of two inspections per product per week would be required,
on its experience
“
based on
quality assurance inspections conducted during the past 18 months”.
It also added that the suggested frequency of twice a week inspection
has also been tested and accepted in the retail environment
during
the past three years.
[74]
The applicants’ gripe with Prokon’s
decision on frequency of inspection and the categorisation of
products into the
two categories and the fees it determined in
respect of each such category is that Prokon cannot rationally
explain the reasons
thereof by for example, providing particulars of
the 18 months experience and whether standard operating procedures
existed. This,
according to the applicants, meant that Prokon’s
inspectors were left to their own devices when it came to determining
frequency
and the categorisation.
[75]
The applicants accordingly submitted that
Prokon’s decision to calculate its fees based on historical
product volumes, cannot
be rationally related to the purpose for
which it exercised its power, namely, to determine its fees.
H.
CONCLUSION
[76]
The applicant’s rationality review has been established as
shown above. The application to review
and set aside Prokon’s
Fee Determination in terms of Section 3(1A)(a)(ii) of the APS Act
published in the Government Gazette
No. 46032 of 11 March 2022,
succeeds.
[77]
The respondents made a submission regarding a conditional
counter-application that in the event that
this court should find for
the applicant, then the court should invoke the provisions of section
172 of the Constitution and suspend
the operation of such finding. I
am not persuaded that this section is applicable in this instance and
will leave the matter at
that.
[78]
In so far as costs are concerned, there was no case made for any
departure from the normal rule that
costs follow the costs.
Accordingly, the first respondent shall cover the applicant’s
costs including the costs of two counsel,
to be taxed on scale B.
J.S. NYATHI
Judge of the High Court
Gauteng Division,
Pretoria
Date
of hearing: 29/07/2024
Date
of Judgment: 17 March 2025
On
behalf of the Applicant: Adv. M.C. Maritz SC
With
him:
Adv. B.C. Stoop SC
Duly
instructed by: Bernhard Van Der Hoven Attorneys, Pretoria
e-mail:
elmari@bvdh.co.za
/
bernhard@bvdh.co.za
On
behalf of the Respondent: Adv. A. Bester SC
With
him:
Adv. M. Mostert
Duly
instructed by: Fairbridges Wertheim Becker
c/o: MACINTOSH, CROSS &
FARQUHARSON; Pretoria.
e-mail:
cfe@macintoshcross.co.za
;
akika@mcinc.africa
Delivery
:
This judgment was handed down electronically by circulation to the
parties' legal representatives by email and uploaded on the
CaseLines
electronic platform. The date for hand-down is deemed to be 17 March
2025.
[1]
Bertie
van ZyI (Pty) Ltd t/a ZZ2 v Minister of Agriculture Forestry and
Fisheries
[2021] 4 All SA 1 (SCA).
[2]
Annexure
FA1.
[3]
A copy of the First Applicant's objection is attached to its
founding affidavit as Annexure FA4.
[4]
Annexure
FA5 dated 20 October 2021.
[5]
Para
3 and 8 2 of letter dated 27 January 2022.
[6]
Ibid
Para
2.
[7]
Para
8 First Respondent’s Heads of Argument.
[8]
[2020]
ZASCA 62
; [2020]
3 All SA 397
(SCA);
2021 (1) SA 42
(SCA) at
para 30.
[9]
[2021]
4 All SA 1 (SCA); [2021] ZASCA 101.
[10]
2000
(2) SA 674 (CC).
[11]
Regulation 18(3)(a) of the Regulations on Fair Administrative
Procedures, 2002 (GN R1022 in GG 23874 of 31 July 2002) requires
the
notice containing proposed administrative action to contain
'sufficient information about the proposed administrative action
to
enable members of the public to submit meaningful comments'.
[12]
Bertie
van Zyl
para 36
Supra.
[13]
Also see:
South
African Fruit and Vegetable Canners Association v Impumelelo Agri
Business Solutions (Pty) Ltd
[2021] ZAGPPHC 227,
2021 3 All SA 242
(GP) paras [18] &
[38].
[14]
[2000] ZACC 1
;
2000
(2) SA 674
(CC) at
para
[85].
[15]
2021
(10) BCLR 1152 (CC).
[16]
Supra
at para
[60].
[17]
Annexure
“FA16” to founding affidavit, being a letter from Van
den Hoven Attorneys dated 3 December 2021.
[18]
Answering
affidavit paras 156 to 164.
[19]
Part II Government Gazette No. 41723 of 22 June 2018.
[20]
Supplementary
founding affidavit para 5.12 read with answering affidavit para 165,
referred to in applicant’s heads of argument.
[21]
In para 2.10 of the Memorandum and in its Fee Determination para
1.10.
sino noindex
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