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Recent developments in case law concerning appeals, consultation, royalties, section 54 MHSA and conversion of rights in undivided shares: Chris Stevens, director

Werksmans Attorneys
Werksmans Attorneys

This document summarizes recent developments in South African case law related to mining law. It discusses cases related to appeals and reviews, consultation requirements, royalties, section 54 of the MHSA, and conversion of rights in undivided mining shares. It also briefly summarizes several other relevant cases on topics such as prospecting rights and interdicts. The document was presented by Chris Stevens on October 18, 2012.

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RECENT DEVELOPMENTS IN CASE LAW CONCERNING APPEALS, CONSULTATION, ROYALTIES, SECTION 54MHSA, AND CONVERSION OF RIGHTS IN UNDIVIDED SHARES Chris Stevens Follow this event on Twitter: #SAMiningLaw
APPEALS AND REVIEWS S96 of MPRDA officer or RM to DG DG to Minister Minister High Court review Rule 53 Global Pact Trading 201 (Pty) Ltd v Minister of Minerals and Energy and Others (OFS PD 3118/06) [2007] ZAFSHC 68 de-centralisation v de-concentration Minister had power to revoke the delegation to DDG Minister could exercise power delegated to herself Minister could exercise control over the exercise of the delegated power a decision of the DDG was a decision of the Minister Follow this event on Twitter: #SAMiningLaw 2
APPEALS AND REVIEWS Bengwenyama Minerals and Others v Genorah Resources and Others (Case CCT39/10 [2010] ZACC 26) delegator retains final control over decision enhance autonomy of administrative process and immediate and cost-effective relief final control exercised by way of appeal values and principles of public administration in Constitution enhanced by appeal process Follow this event on Twitter: #SAMiningLaw 3
CONSULTATION S16(4)(b) and s22(4)(b) consult with landowner or lawful occupier and any other affected party and submit results of consultation S5(4) before commencing any work Bengwenyama (supra) purpose of consultation to see if accommodation is possible on impact on landowner not necessary to reach agreement failure to agree could result in s54 process also to provide information to landowners regarding objections and appeals and reviews Follow this event on Twitter: #SAMiningLaw 4
CONSULTATION Thus applicant must inform landowner of acceptance inform in detail of operations to allow landowner to assess impact consult with view to reach agreement results of consultation S105 MPRDA notify RM if landowner or occupier cannot be readily traced or deceased and no successor can be found non-sensical section Amendment Act Follow this event on Twitter: #SAMiningLaw 5
SECTION 104 PREFERENCE TO COMMUNITIES Benwenyama (supra) s104 creates a special category of rights akin to a right of first refusal to acquire a prospecting right before an application under s16 or s22 which may affect the right of the community may be granted, the community must be informed so that it can apply Definition of Community coherent, social group of persons, with interest or rights in a particular area which the members have or exercise communally in terms of an agreement, custom or law land or minerals must be registered or to be registered Follow this event on Twitter: #SAMiningLaw 6
SECTION 54 MHSA Berts Bricks v Inspector of Mines (North Gauteng Court 15347/2011) declarator that MHSA does not apply to brick-making activities objectively a state of affairs must exist which would lead a reasonable man to believe that it may endanger the health or safety of a person only give an instruction necessary to protect health or safety of person no objective facts existed to suspend operation order out of all proportion and gross abuse of the Act Follow this event on Twitter: #SAMiningLaw 7
ROYALTIES Whether royalties continue to apply after conversion Xstrata South Africa and Others v SFF Association 2012 (5) SA 60 (SCA) mineral lease conferring right to mine in return for royalties item 7(4) was debated no decision but assumed it related to terms and conditions which continued to apply after conversion Tavistocks entitlement to mine no longer has its origins in the mineral lease if lease falls away no need to pay royalties double payment of royalties could imperil financial viability of operation (no basis for this contention) Follow this event on Twitter: #SAMiningLaw 8
ROYALTIES right to claim royalties under a contract, such as this mineral lease, concluded prior to the Act coming into force and maintaned during the transitional period in the form of a condition attaching to an old order mining right, does not serve the purposes and would be contrary to the Act above statement is obiter and no mention of why the royalty is contrary to the Act if consideration is in the form of a sale of mineral rights perfected before the MPRDA, then there is no reason why that should no longer be payable Follow this event on Twitter: #SAMiningLaw 9
UNDIVIDED SHARES OF OLD ORDER RIGHTS Sishen Iron Ore and Others v Minister of Mineral Resources and Others (North Gauteng - Case No. 28980/10) nowhere in the converted mining right of Sishen was there a restriction to 78,6% of the converted mining right 100% full right granted ICT granted prospecting right for 21,4% court held that Minister granted 100% mining right RM had no power to accept ICTs application or Sishens application for 21,4% on appeal convert only what one has Follow this event on Twitter: #SAMiningLaw 10
OTHER CASES BHP Billiton Energy Coal v Minister and Others and Finishing Touch (North Gauteng Court 67536/2010) [2012] ZASCA 49 interdict upheld pending outcome of appeal/review review order set aside because of non-joinder of party to whom a prospecting right was granted Khusela Women Investment v Minister and Afex unreported (North Gauteng Court 52109/08) conflicting prospecting right granted to Afex (State company) set aside Joubert v Maranda Mining 2010 (1) SA 198 (SCA) access to land interdict granted Follow this event on Twitter: #SAMiningLaw 11
OTHER CASES Maccsand v City of Cape Town (Justin Truter) Minister v AgriSA [2012] ZASCA 93 the contention that all mineral rights that existed in South Africa under the 1991 Act were expropriated under the MPRDA not correct Norgold Investments v Rhodium Reefs and Minister (SCA 278/10) (2011) ZASCA 49 lodging application in wrong Regional Office not fatal Southern Sphere v Minister unreported (North Gauteng - Case 38976/07) validity of s103(4) decision Follow this event on Twitter: #SAMiningLaw 12
OTHER CASES De Beers v Ataqua unreported (OFS PD Case No. 3215/06) [2007] ZAFSHC 74 Dumps created pre-MPRDA not governed by Schedule II nor substantive parts of MPRDA Silver Meadow v Golfview unreported (North Gauteng Case No 39706/2007) rescission of review order granted 180 day period in s39(1) of MPRDA is peremptory Follow this event on Twitter: #SAMiningLaw 13
THANK YOU Chris Stevens 18 October 2012 Nothing in this presentation should be construed as formal legal advice from any lawyer or this firm. Readers are advised to consult professional legal advisors for guidance on legislation which may affect their businesses. 息 2012 Werksmans Incorporated trading as Werksmans Attorneys. All rights reserved. Follow this event on Twitter: #SAMiningLaw

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Recent developments in case law concerning appeals, consultation, royalties, section 54 MHSA and conversion of rights in undivided shares: Chris Stevens, director

  • 1. RECENT DEVELOPMENTS IN CASE LAW CONCERNING APPEALS, CONSULTATION, ROYALTIES, SECTION 54MHSA, AND CONVERSION OF RIGHTS IN UNDIVIDED SHARES Chris Stevens Follow this event on Twitter: #SAMiningLaw
  • 2. APPEALS AND REVIEWS S96 of MPRDA officer or RM to DG DG to Minister Minister High Court review Rule 53 Global Pact Trading 201 (Pty) Ltd v Minister of Minerals and Energy and Others (OFS PD 3118/06) [2007] ZAFSHC 68 de-centralisation v de-concentration Minister had power to revoke the delegation to DDG Minister could exercise power delegated to herself Minister could exercise control over the exercise of the delegated power a decision of the DDG was a decision of the Minister Follow this event on Twitter: #SAMiningLaw 2
  • 3. APPEALS AND REVIEWS Bengwenyama Minerals and Others v Genorah Resources and Others (Case CCT39/10 [2010] ZACC 26) delegator retains final control over decision enhance autonomy of administrative process and immediate and cost-effective relief final control exercised by way of appeal values and principles of public administration in Constitution enhanced by appeal process Follow this event on Twitter: #SAMiningLaw 3
  • 4. CONSULTATION S16(4)(b) and s22(4)(b) consult with landowner or lawful occupier and any other affected party and submit results of consultation S5(4) before commencing any work Bengwenyama (supra) purpose of consultation to see if accommodation is possible on impact on landowner not necessary to reach agreement failure to agree could result in s54 process also to provide information to landowners regarding objections and appeals and reviews Follow this event on Twitter: #SAMiningLaw 4
  • 5. CONSULTATION Thus applicant must inform landowner of acceptance inform in detail of operations to allow landowner to assess impact consult with view to reach agreement results of consultation S105 MPRDA notify RM if landowner or occupier cannot be readily traced or deceased and no successor can be found non-sensical section Amendment Act Follow this event on Twitter: #SAMiningLaw 5
  • 6. SECTION 104 PREFERENCE TO COMMUNITIES Benwenyama (supra) s104 creates a special category of rights akin to a right of first refusal to acquire a prospecting right before an application under s16 or s22 which may affect the right of the community may be granted, the community must be informed so that it can apply Definition of Community coherent, social group of persons, with interest or rights in a particular area which the members have or exercise communally in terms of an agreement, custom or law land or minerals must be registered or to be registered Follow this event on Twitter: #SAMiningLaw 6
  • 7. SECTION 54 MHSA Berts Bricks v Inspector of Mines (North Gauteng Court 15347/2011) declarator that MHSA does not apply to brick-making activities objectively a state of affairs must exist which would lead a reasonable man to believe that it may endanger the health or safety of a person only give an instruction necessary to protect health or safety of person no objective facts existed to suspend operation order out of all proportion and gross abuse of the Act Follow this event on Twitter: #SAMiningLaw 7
  • 8. ROYALTIES Whether royalties continue to apply after conversion Xstrata South Africa and Others v SFF Association 2012 (5) SA 60 (SCA) mineral lease conferring right to mine in return for royalties item 7(4) was debated no decision but assumed it related to terms and conditions which continued to apply after conversion Tavistocks entitlement to mine no longer has its origins in the mineral lease if lease falls away no need to pay royalties double payment of royalties could imperil financial viability of operation (no basis for this contention) Follow this event on Twitter: #SAMiningLaw 8
  • 9. ROYALTIES right to claim royalties under a contract, such as this mineral lease, concluded prior to the Act coming into force and maintaned during the transitional period in the form of a condition attaching to an old order mining right, does not serve the purposes and would be contrary to the Act above statement is obiter and no mention of why the royalty is contrary to the Act if consideration is in the form of a sale of mineral rights perfected before the MPRDA, then there is no reason why that should no longer be payable Follow this event on Twitter: #SAMiningLaw 9
  • 10. UNDIVIDED SHARES OF OLD ORDER RIGHTS Sishen Iron Ore and Others v Minister of Mineral Resources and Others (North Gauteng - Case No. 28980/10) nowhere in the converted mining right of Sishen was there a restriction to 78,6% of the converted mining right 100% full right granted ICT granted prospecting right for 21,4% court held that Minister granted 100% mining right RM had no power to accept ICTs application or Sishens application for 21,4% on appeal convert only what one has Follow this event on Twitter: #SAMiningLaw 10
  • 11. OTHER CASES BHP Billiton Energy Coal v Minister and Others and Finishing Touch (North Gauteng Court 67536/2010) [2012] ZASCA 49 interdict upheld pending outcome of appeal/review review order set aside because of non-joinder of party to whom a prospecting right was granted Khusela Women Investment v Minister and Afex unreported (North Gauteng Court 52109/08) conflicting prospecting right granted to Afex (State company) set aside Joubert v Maranda Mining 2010 (1) SA 198 (SCA) access to land interdict granted Follow this event on Twitter: #SAMiningLaw 11
  • 12. OTHER CASES Maccsand v City of Cape Town (Justin Truter) Minister v AgriSA [2012] ZASCA 93 the contention that all mineral rights that existed in South Africa under the 1991 Act were expropriated under the MPRDA not correct Norgold Investments v Rhodium Reefs and Minister (SCA 278/10) (2011) ZASCA 49 lodging application in wrong Regional Office not fatal Southern Sphere v Minister unreported (North Gauteng - Case 38976/07) validity of s103(4) decision Follow this event on Twitter: #SAMiningLaw 12
  • 13. OTHER CASES De Beers v Ataqua unreported (OFS PD Case No. 3215/06) [2007] ZAFSHC 74 Dumps created pre-MPRDA not governed by Schedule II nor substantive parts of MPRDA Silver Meadow v Golfview unreported (North Gauteng Case No 39706/2007) rescission of review order granted 180 day period in s39(1) of MPRDA is peremptory Follow this event on Twitter: #SAMiningLaw 13
  • 14. THANK YOU Chris Stevens 18 October 2012 Nothing in this presentation should be construed as formal legal advice from any lawyer or this firm. Readers are advised to consult professional legal advisors for guidance on legislation which may affect their businesses. 息 2012 Werksmans Incorporated trading as Werksmans Attorneys. All rights reserved. Follow this event on Twitter: #SAMiningLaw