Central Energy Fund SOC Ltd and Another v Venus Rays Trade (Pty) Ltd and Others (119/2021) [2022] ZASCA 54; 2022 (5) SA 56 (SCA); [2022] HIPR 191 (SCA) (13 April 2022)

Central Energy Fund SOC Ltd and Another v Venus Rays Trade (Pty) Ltd and Others (119/2021) [2022] ZASCA 54; 2022 (5) SA 56 (SCA); [2022] HIPR 191 (SCA) (13 April 2022)

The Supreme Court of Appeal held that the high court correctly exercised its discretion in awarding compensation for out-of-pocket expenses to Contango and Vitol, who were innocent third parties. The compensation was not damages for lost profits but restitution, restoring them to the position they would have...

Source-derived case information.

Citation
[2022] ZASCA 54
Parties
Appellant: Central Energy Fund SOC Ltd; Appellant: Strategic Fuel Fund Association NPC; Respondent: Venus Rays Trade (Pty) Ltd; Respondent: Glencore Energy UK Ltd; Respondent: Taleveras Petroleum Trading DMCC; Respondent: Contango Trading SA; Respondent: Natixis SA; Respondent: Vesquin Trading (Pty) Ltd; Respondent: Vitol Energy (SA) (Pty) Ltd; Respondent: Vitol SA; Respondent: Minister of Energy; Respondent: Minister of Finance; Amicus Curiae: Organisation Undoing Tax Abuse
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
13 April 2022
Case Number
119/2021
Procedural Posture
Civil Appeal / Appeal From Western Cape Division of the High Court, Cape Town
Outcome
Appeal dismissed. High court's orders granting compensation for out-of-pocket expenses to Contango and Vitol upheld.
Judges
Maya, Dambuza, Schippers, Plasket, Meyer
Legal Topics
Promotion of Administrative Justice Act, Principle of Legality, Public Procurement Irregularity, Just and Equitable Remedy, Restitution, State Entity Misconduct
Administrative Law Commercial and Corporate Promotion of Administrative Justice Act Principle of Legality Public Procurement Irregularity Just and Equitable Remedy Restitution State Entity Misconduct

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Parties

Central Energy Fund SOC Ltd

Appellant

Strategic Fuel Fund Association NPC

Appellant

Venus Rays Trade (Pty) Ltd

Respondent

Glencore Energy UK Ltd

Respondent

Taleveras Petroleum Trading DMCC

Respondent

Contango Trading SA

Respondent

Natixis SA

Respondent

Vesquin Trading (Pty) Ltd

Respondent

Vitol Energy (SA) (Pty) Ltd

Respondent

Vitol SA

Respondent

Minister of Energy

Respondent

Minister of Finance

Respondent

Organisation Undoing Tax Abuse

Amicus Curiae

Procedural Posture

Civil Appeal / Appeal From Western Cape Division of the High Court, Cape Town

Legal Issues

  1. 1 Whether the high court's order granting compensation for out-of-pocket expenses to innocent contracting parties was just and equitable.
  2. 2 Whether the delay by the appellants in instituting review proceedings should be condoned.
  3. 3 Whether innocent third parties should be compensated for losses incurred due to invalid state contracts.

Ratio Decidendi

The Supreme Court of Appeal held that the high court correctly exercised its discretion in awarding compensation for out-of-pocket expenses to Contango and Vitol, who were innocent third parties. The compensation was not damages for lost profits but restitution, restoring them to the position they would have occupied had the unlawful contracts not been concluded. The court found that the SFF and CEF's egregious delay and misconduct exacerbated the losses suffered by Contango and Vitol, and that the public interest is served by holding state entities accountable for irregular transactions. The principles of legality, restitution, and no-profit-no-loss required that innocent parties not...

Court Disposition

Appeal dismissed. High court's orders granting compensation for out-of-pocket expenses to Contango and Vitol upheld.

Orders

  • The appeal against paragraphs 7(b) to 14 and paragraphs 15(b) to 17 of the order of the court below is dismissed, with costs.
  • Costs in relation to the third respondent are limited to the costs of one counsel; costs for the fourth to eighth respondents include the costs of three counsel.