Fireblade Aviation Proprietary Limited v Minister of Home Affairs and Others (85376/2016; 93450/2016) [2017] ZAGPPHC 1064 (8 December 2017)

IN THE HIGH COURT OF SOUTH AFRICA

GAUTENG DIVISION, PRETORIA

Case Number: 85376/2016

93450/2016

NOT REPORTABLE

NOT OF INTEREST TO OTHER JUDGES

REVISED

8/12/2017

In the matter between

FIREBLADE AVIATION PROPRIETARY LIMITED APPLICANT

AND

MINISTER OF HOME AFFAIRS FIRST RESPONDENT

DIRECTOR-GENERAL OF HOME AFFAIRS SECOND RESPONDENT

SOUTH AFRICAN REVENUE SERVICE THIRD RESPONDENT

DENEL SOC LIMITED FOURTH RESPONDENT

AIRPORTS COMPANY SOUTH AFRICA

SOC LIMITED FIFTH RESPONDENT

PRECINCT 2A INVESTMENTS PROPRIETARY

LIMITED SIXTH RESPONDENT

JUDGMENT: APPLICANT'S APPLICATION FOR LEAVE TO EXECUTE THE ORDER PENDING APPEAL

Potterill J

[ 1] Fireblade Aviation Proprietary Limited ("Fireblade") is applying in terms of section 18(1) read with section 18(3) of the Superior Courts Act 10 of 2013 ("the Act") that this court direct that pending the outcome of the first and second respondent's application for leave to appeal before this court and any subsequent application for leave to appeal or appeal that may be delivered by any of the other respondents it be directed that the order granted on 27 October 2017 is not suspended and is given effect to. This application is opposed by the Minister of Home Affairs ("the Minister") and the Director-General of Home Affairs ("DG").

[2] The relevant sections of section 18 of the Act reads as follows:

"Suspension of decision pending appeal

18(1) Subject to subsections (2) and (3), and unless the court under exceptional circumstances orders otherwise, the operation and execution of a decision which is the subject of an application for leave to appeal or of an appeal, is suspended pending the decision of the application or appeal.

(2) Subject to subsection (3), unless the court under exceptional circumstances orders otherwise, the operation and execution of a decision that is an interlocutory order not having the effect of a final judgment, which is the subject of an application for leave to appeal or of an appeal, is not suspended pending the decision of the application or appeal.

(3) A court may only order otherwise as contemplated in subsection (1) or (2), if the party who applied to the court to order otherwise, in addition proves on a balance of probabilities that he or she will suffer irreparable harm if the court does not so order and that the other party will not suffer irreparable harm if the court so orders.

(4) If a court orders otherwise, as contemplated in subsection (1) –

(i) the court must immediately record its reasons for doing so;

(ii) the aggrieved party has an automatic right of appeal to the next highest court;

(iii) the court hearing such an appeal must deal with it as a matter of extreme urgency; and

(iv) such order will be automatically suspended, pending the outcome of such appeal.”

[3] This application is novel in that an application in terms of section 18 would normally present itself where leave to appeal is granted. Herein leave to appeal is denied, because there are no reasonable prospects of success. Furthermore this application seeks execution of the order even if any other future applications for leave to appeals or appeals are pending. Counsel for the Minister and DG placed on record that he held instructions to petition to the Supreme Court of Appeal if l should refuse the application for leave to appeal. It is thus clear that the execution of the judgment will be further suspended. Neither in argument, nor in the opposition is there any opposition to this "futuristic" relief sought.

[4] I am not going to reinvent the wheel. My brother Sutherland J gave a well-reasoned judgment[1] that received the imprimatur of the Supreme Court of Appeal in University of the Free State v Afriforum and Another [2017] 1 All SA 79 (SCA). In essence the adjudication of an application in terms of section 18 of the Act must be fact specific. An applicant in terms of this section is required to prove not only that exceptional circumstances exist justifying the lifting of the suspension of the order, but prove on a balance of probabilities, that it will suffer irreparable harm if the order sought to be appealed against is not suspended, and that the respondent, in turn, will not suffer irreparable harm. These requirements introduced by ss 18(1) and (3) are more onerous than the previous requirements of the common law.

[5] As background to the application the following facts are set out. In the judgment it was found that the Minister had finally granted approval for the Fixed Based Aviation Operation ("the FBO") to be conducted by officials of the Border Control Operational Coordination Committee (“the BCOCC"), not employers of Fireblade, at premises leased by Fireblade from Denel at OR Tambo International Airport ("ORTIA"). The provision of Customs and Immigrations Services ("C & I Services") necessary to facilitate international arrivals and departures of Heads of State, global business persons, celebrities and other important individuals using private aircraft to travel in and out of South Africa via Johannesburg needed to be implemented. It is common cause that the C and I Services would not be rendered by Fireblade itself, as Fireblade personnel will also be precluded from accessing a sterile zone of Fireblade’s premises; "Sterile” in the sense that the area is isolated as a safe and secure C & S facility under the control of government representatives.

[6] The FBO has been in operation in respect of domestic flights since 1 September 2014. The existing domestic and the envisaged

international operations of the FBO is pursuant to the investment by Fireblade of hundreds of millions of Rands in leasing and securing the Fireblade premises and establishing

and developing its infrastructure requirements and operational procedures and gaining the approval and support of a host of relevant

state agencies and Departments. All of these efforts culminated in the approval and support for the FBO by all relevant state agencies

and Departments, including the Minister of Home Affairs. On 28 January 2016 the Minister informed executives of Fireblade that he had already signed his approval of the Fireblade application.

Exceptional circumstances set out by Fireblade

[7] The Minister's conduct

The Minister is not an ordinary litigant and has a duty in law to place a full and fair factual account of the facts before the court. Contrary thereto the court found the Minister's averments and arguments in the application to be “disingenuous, spurious and fundamentally flawed, laboured and meritless, bad in law, astonishing, palpably untrue, untenable and not sustained by objective evidence, uncreditworthy, and nonsensically". The exceptional circumstance thus is that there are no prospects of success on appeal. It was also submitted that the current Minister is the second in quick succession after Minister Gigaba and is unlikely to be familiar with the details of Minister Gigaba's thoughts, actions and motivations.

Government is the exclusive provider of Customs and Immigrations Services ("C & I Services")

[8] The Government is the exclusive provider of C & I Services. The Government already renders such services at Lanseria and Kruger Mpumalanga International Airports as well as Pilanesberg Airport. These facilities have no scheduled international flights and all international flights are thus through private or chartered aircraft. The Immigration Services at these facilities are dedicated to the private, as opposed to, the general commercial flying public.

[9] South Africa needs to compete with other destinations in how it treats potential Investors and those tourists who choose to travel privately and make use of exclusive facilities. This would be in accordance with the preamble to the Immigration Act which reads as follows:

"… aims at setting in place a new system of immigration control which ensures that -

(d) economic growth is promoted through the employment of needed foreign labour, foreign investment is facilitated, the entry of exceptionally skilled or qualified people Is enabled, skilled human resources are increased, academic exchanges within the Southern African Development Community is facilitated and tourism is promoted;

(f) the entry and departure of all persons at ports of entry are efficiently facilitated, administered and managed;

(h) the South African economy may have access at all times to the full measure of needed contributions by foreigners."

Engagement with SOBS and Government Agencies and their undertakings

[10] The scale and scope of the interactions between Fireblade and all relevant agencies took an unprecedented almost four years. Ultimately it culminated that all BCOCC approvals were obtained. On 28 January 2016 the Minister granted his final approval, as declared by the court in paragraphs 39-55 of the applicant's application all the e-mail exchanges, representations, proposals, meetings and engagements with all the relevant stakeholders are summarised. In paragraph 57 it is reiterated that on 29 April 2016 ACSA reconfirmed its approval and support. ACSA went a step further and added that the FBO was one of ACSA's first steps in reorganising commercial aviation at ORTIA and that it considered the FBOs and the extension to the airport facilities at ORTIA setting out the benefits to ACSA of the FBO facility.

The FBO was designed to BCOCC's specifications

[11] It is undisputed that the sterile zone, and as well as other facilities enabling government agencies to discharge their functions

such as dog kennels, a separate server room, the sterile zone, etc. are ready to operate.

The provision of the C & I Services has been approved by all stakeholder agencies and Departments

[12] The standard operating procedures manual ("SOP") was finalised between the parties and can be put into operation.

Are there exceptional circumstances

[13] Can the fact that the court has found that there are no reasonable prospects of success constitute exceptional circumstances? I would venture to say that not in every case this would be so, but I find that on these facts, the very poor prospects of success on appeal, do set up exceptional circumstances. A court does not readily find a Minister's averments and arguments to be disingenuous, spurious and fundamentally flawed, laboured and meritless, bad in law, astonishing, palpably untrue, untenable, not sustained by objective evidence, uncreditworthy and nonsensical. In this matter however it had to be done. The contentious issue was simply whether the Minister had granted a decision to approve that the services be rendered at the FBO. On a document in the Minister's own hand he wrote that the approval that he gave to Fireblade had to be suspended. Yet, the Minister and DG persists in pursuing this appeal. I need not address all the arguments as set out in the application for leave to appeal because they are dealt with in the judgment thereon, it suffices to say that also on the arguments based on law there are no prospects of success in that the arguments are bad in law. The execution of the order should not be suspended if there are no prospects of success on appeal.

[14] The Minister, DG, Denel and SARS did not appeal the finding that by mid-January 2016 all the stakeholders excepting for the Minister, had expressed support for the rendering of C & t Services at the FBO. With the court finding that the Minister had on 28 January 2016 granted approval, suspending the execution of the order serves no purpose. Even if it is to be accepted that investing and developing the FBO to all the requirements of alt the stakeholders would be cumbersome and time­ consuming a four year period to obtain same is an inordinate delay. On the common cause facts the delay emanated from the office of the Minister. From the date the Minister gave approval another two years have lapsed. To follow the default position of suspension of the order leading to further delays constitute exceptional circumstances. Fireblade understood it would have to secure approval for the provision of the C & I Services at the FBO. From the papers Fireblade had a well-founded expectation that Ministerial authorisation would be forthcoming and it in fact came on 28 January 2016. From that date the C & I Services should have been rendered; two years on and it is still not rendered. Such conduct is constitutionally unconscionable and renders the circumstances exceptional.

[15] Only the Government can render the C & I Services and Fireblade is thus in an unenviable situation that refusal to render the services leaves them helpless. It is not in dispute that ACSA, ORTIA and the BCOCC are lined up to render these services. It is also undisputed that the SOB is in place and ready to be executed.

[16] I accordingly find that Fireblade has proven exceptional circumstances.

Wilt Fireblade suffer irreparable harm

[17] Financial losses

The Minister and DG cannot deny that Fireblade's operation of the FBO resulted in accumulated losses at October 2017 of± R372, 799,244; in nobody's book is that a small loss. It can also not be denied that Fireblade is unable to secure a return on its capital investment while unable to offer an attractive bouquet of services to international travellers. It is not denied that Fireblade will receive revenue for services rendered at that time, but it will not recover revenue losses of the preceding years. Fireblade is a commercial venture; Fireblade leases from Denel as expressly stated in the lease agreement for the sole purpose to operate a FBO. In these circumstances an impact on business profits constitutes irreparable harm.

[18] The FBO is geared for the international traveller. The FBO does not and cannot handle international passengers without the provision of the C & I Services. The reasons for this is set out in paragraph 44.2 and reads as follows:

"A person who lands at ORTIA in a private aircraft must taxi or be conveyed by a vehicle to the main terminal, where he or she is processed by customs and immigration officials and ends up on the 'landslide' section of the airport. The same is true in relation to crew members. If it is intended to make use of the FBO, the aircraft must taxi along and across runways to reach the facility. This is regarded and must be treated as a domestic movement all of its own. On arrival, crew members must be processed through the FBO's domestic arrivals section. What, though, becomes of the traveller himself or herself? He or she must either be collected outside the main terminal and conveyed by road around the ORTIA complex to the landslide entrance of the FBO or do what is required to be reunited with the aircraft before it undertakes its journey to the FBO. This involves being processed through the domestic departures section of the main terminal and awaiting the taxiing of the aircraft from the international parking area to the domestic paring area. The passenger may then be taxied to the FBO where he or she must be processed through its domestic arrivals section. Essentially the same steps must be traversed in reverse in respect of international departures. Unsurprisingly, when these inconveniences are described to potential international customers of the FBO, most opt simply to land and be processed at the main terminal of ORTIA, without making any use of the FBO" This expose clearly illustrates that Fireblade will continue to suffer irreparable harm.”

[19] The FBO's main revenue driver is fuel, but include hangerage, ramp parking and ancillary support services associated with aircraft

movement. The revenue services will remain depressed for as long as the C & I Services cannot be rendered at the FBO.

[20] Fireblade has not had the benefits of its investment. Fireblade depreciated its assets so as to write 9ff their costs over their estimated useful lives using a straight line depreciated method. The useful lives of fixed assets are limited to the remaining period of the lease which expires in 2022.

Missed opportunities

[21] Porsche hosted its premier annual global event at the FBO, between -4 20 November 2017. Porsche chose South Africa and Fireblade was chosen as the host. This event generated over 1 400 international passengers which could have been processed through the FBO. All the private aircraft that came in for the event could not use the FBO because it is unable to offer the C & I Services.

[22] "Fireblade also gets requests from worldwide trip support' companies to facilitate international movements through the FBO. These companies include Universal Weather and Aviation, Jetex, Rockwell Collins, Colt/World Fuel Services (WFS) and Palm Aviation. Because Fireblade cannot offer the C & I services, the trip support companies divert their International traffic to other destinations.”[2]

[23] The clients supporting the FBO, although on a limited basis are:

1. Global 5000 (Europe based), with two international flights (four movements) per month;

2. Citation X (Germany), with one international flight a month;

3. Global G6000 (Europe), with one international flight a month; and

4. Challenger 350 (South Africa), with four international flights a month.

These volumes will however increase if C & I services can be provided.

[24] The whole nature of the FBO militates against customers being loaded onto a Combi to go through C & I services. The losses are real as the leased premises have no other potential revenue streams and unless the assets can be utilised as intended the losses will not be reversed. The loss of customers is also real.

[25] I am satisfied that Fireblade has proven that it will suffer irreparable harm arising from the suspension of the order and not due to bad business practice.

Enforcement will not cause the Minister and the DG irreparable harm

[26] Neither the Department of Home Affairs nor any other state agency or Department will incur expenses in consequence of providing the C & I Services at the FBO. The reason for this is that it is common cause that Fireblade has undertaken to bear and pay any such costs.

[27] Fireblade set out that on 2 and 6 November 2017 Fireblade notified BCOCC of an international flight intended to be handled at the FBO on 8 November 2017. SARS' Customs officials attended at the FBO which serves as proof that no irreparable harm was suffered in acting in compliance with the order.

[28] Fireblade has tendered and tenders to adhere to the SOB to facilitate the safe and seamless handling of international flights.

[29] To the contrary the Minister and DG contend that the Department will suffer irreparable harm if the order is enforced, because the C & I Services at the FBO will put the current immigration system at ORTIA under enormous pressure. This will in turn have a serious impact on the rendering of immigration services at the main terminal. The implementation of the order will not only impact on the Department, but also on multiple stakeholders. The Department has not budgeted for the additional expenses and resources required to give effect to Fireblade's application. It has also put up the argument that the enforcement of the order will jeopardise the safety of South African borders and will increase the potential breaches of the provisions of the Immigration Act.

[30] It has to be accepted that Fireblade will furnish and fund suitable transportation between the main terminal and the FBO. Furthermore it was uncontested that Fireblade had committed to pay any expenses for

[31] The argument that the enormous pressure at the main terminal constitutes irreparable harm to the Minister and DG is to be rejected. The SOB is in place whereby state agencies and Departments expressed satisfaction with the practical

arrangements. The BCOCC officials gave their imputs before the finalisation of the SOP.

[32] Not in the main or review application did the Minister or DG identify practical or security problems with the SOP. Any security risk is circumvented by the sterile area that was constructed and will be maintained by the BCOCC at the insistence of the BCOCC officials.

[33] I accordingly find that the Minister and the DG will not suffer irreparable harm.

[34] Fireblade has proven all three the requirements of an application in terms of section 18 and I make the following order:

34.1 The order granted by the court in this matter on 27 October 2017 is not suspended and has to be given effect to pending the outcome of the first and second respondent's application for leave to appeal dated 6 November 2017, as well as any subsequent applications for leave to appeal that may be delivered by any of the other respondents as well as any other appeal.

34.2 The first and second respondents are ordered to pay the costs of the application including the costs of two counsel.

____________________

POTTERILL S

(JUDGE OF THE HIGH COURT)

MATTER HEARD ON

: 1 December 2017

FOR THE APPLICANT

: ADV. A.E. FRANKLIN SC

ADV. R.M. PEARCE ADV. N. LUTHULI

INSTRUCTED BY

:

Werksmans Attorneys

FOR THE 151 and 2"° RESPONDENT : ADV. T. NGCUKAITOBI

ADV.HOBDEN

INSTRUCTED BY

: Office of the State Attorney

DATE OF JUDGMENT

: 8 December 2017

[1] lncubeta Holdings Ltd v Ellis 2014 (3) SA 189 (GJ)

[2] Founding affidavit paragraph 73