Brain Gear Investments (Pty) Ltd and Others v Buhle Waste (Pty) Ltd and Another (102/2023; 103/2023; 108/2023; 110/2023) [2024] ZASCA 168 (5 December 2024)

Brain Gear Investments (Pty) Ltd and Others v Buhle Waste (Pty) Ltd and Another (102/2023; 103/2023; 108/2023; 110/2023) [2024] ZASCA 168 (5 December 2024)

The Supreme Court of Appeal held that the Municipality's decision of 14 November 2018 constituted administrative action as it was the exercise of a public power under legislation and directly affected rights. The Municipality failed to comply with its own conditions for oversight and consultation in the selection of the 28% BBBEE shareholder for Silulumanzi. The process was not transparent or fair, and the Municipality played no role in the selection, contrary to its June 2018 resolution. The selection of Brain Gear was not made in consultation with the Municipality, and Brain Gear lacked experience in the water sector. The Municipality misconceived its role, ignored relevant...

Citation
[2024] ZASCA 168
Parties
Appellant: Brain Gear Investments (Pty) Ltd; Appellant: Sembcorp Silulumanzi (RF) (Pty) Ltd; Appellant: Sembcorp Utilities (Netherlands) NV; Appellant: Municipal Manager: City of Mbombela Municipality; Appellant: South African Water Works (Pty) Ltd; Appellant: Sembcorp Utilities South Africa (Pty) Ltd; Appellant: The Chairperson: Council of the City of Mbombela Municipality; Appellant: The City of Mbombela Municipality; Respondent: Buhle Waste (Pty) Ltd; Respondent: ZMG Scientific Services (Pty) Ltd
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
5 December 2024
Case Number
102/2023;103/2023;108/2023;110/2023
Procedural Posture
Civil Appeal / Appeal From the Mpumalanga Division of the High Court, Mbombela
Outcome
Appeal upheld in part; high court's order reviewed and set aside in respect of paragraphs 118.3 to 118.7; remainder of appeal dismissed with costs, including costs of two counsel where employed.
Judges
Mocumie, Schippers, Weiner, Molefe, Coppin
Legal Topics
Promotion of Administrative Justice Act, Municipal Oversight, Broad Based Black Economic Empowerment, Water Services Concession, Review of Administrative Action, Unreasonable Decision
Administrative Law Civil Procedure Commercial and Corporate Promotion of Administrative Justice Act Municipal Oversight Broad Based Black Economic Empowerment Water Services Concession Review of Administrative Action +1 more

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Parties

Brain Gear Investments (Pty) Ltd

Appellant

Sembcorp Silulumanzi (RF) (Pty) Ltd

Appellant

Sembcorp Utilities (Netherlands) NV

Appellant

Municipal Manager: City of Mbombela Municipality

Appellant

South African Water Works (Pty) Ltd

Appellant

Sembcorp Utilities South Africa (Pty) Ltd

Appellant

The Chairperson: Council of the City of Mbombela Municipality

Appellant

The City of Mbombela Municipality

Appellant

Buhle Waste (Pty) Ltd

Respondent

ZMG Scientific Services (Pty) Ltd

Respondent

Procedural Posture

Civil Appeal / Appeal From the Mpumalanga Division of the High Court, Mbombela

Legal Issues

  1. 1 Whether the Municipality's decision of 14 November 2018 to approve the change in control of Silulumanzi complied with the oversight and consultation conditions imposed in June 2018.
  2. 2 Whether the Municipality's conduct constituted administrative action reviewable under PAJA.
  3. 3 Whether the Municipality's failure to oversee and consult in the selection of the BBBEE shareholder rendered its decision unlawful and unreasonable.

Ratio Decidendi

The Supreme Court of Appeal held that the Municipality's decision of 14 November 2018 constituted administrative action as it was the exercise of a public power under legislation and directly affected rights. The Municipality failed to comply with its own conditions for oversight and consultation in the selection of the 28% BBBEE shareholder for Silulumanzi. The process was not transparent or fair, and the Municipality played no role in the selection, contrary to its June 2018 resolution. The selection of Brain Gear was not made in consultation with the Municipality, and Brain Gear lacked experience in the water sector. The Municipality misconceived its role, ignored relevant...

Court Disposition

Appeal upheld in part; high court's order reviewed and set aside in respect of paragraphs 118.3 to 118.7; remainder of appeal dismissed with costs, including costs of two counsel where employed.

Orders

  • The appeal is upheld in part.
  • Paragraphs 118.3 to 118.7 of the order of the high court are set aside.