Henning v Premier of the North-West Provincial Government and Others (408/02) [2003] ZANWHC 67 (27 November 2003)

CASE NO : 408/02

IN THE HIGH COURT OF SOUTH AFRICA

(BOPHUTHATSWANA PROVINCIAL DIVISION)

In the matter between:

FIONA HENNING APPLICANT

and

THE PREMIER OF THE NORTH-WEST

PROVINCIAL GOVERNMENT 1ST RESPONDENT

THE MEMBER OF THE EXECUTIVE COUNCIL:

ECONOMIC DEVELOPMENT AND TOURISM

NORTH-WEST PROVINCIAL GOVERNMENT 2ND RESPONDENT

MRS THEMBI MOJA NO 3RD RESPONDENT

MR CHRIS FISMER NO 4TH RESPONDENT

TUSK RESORTS (PTY) LTD 5TH RESPONDENT

SUN INTERNATIONAL (SOUTH

AFRICA) LIMITED 6TH RESPONDENT

APPLICATION MMABATHO LEEUW J FOR THE APPLICANT : ADV N JAGGA FOR 1-3 RESPONDENTS : ADV D POTGIETER SC FOR 4 & 5 RESPONDENT : NO APPEARANCE FOR 6TH RESPONDENT : ADV A COCKRELL DATE OF HEARING : 18 SEPTEMBER 2003 DATE OF JUDGMENT : 27 NOVEMBER 2003 J U D G M E N T LEEUW J: The Applicant approached this Court on the 24th July 2003 for an order in the following terms: “1. Reviewing the decision by the First Respondent to issue Proclamation 3 published in the Government Gazette 5754 of 2 April 2002 wherein the First Respondent put the North West Gambling Act No 2 of 2001 into operation and setting same aside. Declaring Section 51 of the North West Gambling Act No 2 of 2001 unconstitutional and null and void.

APPLICATION

MMABATHO

LEEUW J

FOR THE APPLICANT : ADV N JAGGA

FOR 1-3 RESPONDENTS : ADV D POTGIETER SC

FOR 4 & 5 RESPONDENT : NO APPEARANCE

FOR 6TH RESPONDENT : ADV A COCKRELL

DATE OF HEARING : 18 SEPTEMBER 2003

DATE OF JUDGMENT : 27 NOVEMBER 2003

J U D G M E N T

LEEUW J:

The Applicant approached this Court on the 24th July 2003 for an order in the following terms:

“1. Reviewing the decision by the First Respondent to issue Proclamation 3 published in the Government Gazette 5754 of 2 April 2002 wherein the First Respondent put the North West Gambling Act No 2 of 2001 into operation and setting same aside.

Declaring Section 51 of the North West Gambling Act No 2 of 2001 unconstitutional and null and void.

(a) Interdicting and restraining the Third Respondent, from interfering with or preventing the business of the Applicant, either personally or through the Police or any other person or agency, conducted under the name and style of “Mermaids” from its premises at 5b Pretorius Street, Fochville (b) Alternatively to the above, declaring that the business of the Applicant pertaining to the manner and form of operation of entertainment conducted under the name and style “Mermaids” from the premises situated at 5b Pretorius Street, Fochville fall outside the scope ambit of Section 50 of the North West Gambling Act, Act 2 of 2001. Further and/or alternative relief. That the First, Second, Third Respondents be ordered to pay the Applicant’s costs jointly and severally, the one paying, the others to be absolved (only in the event of the opposition of this application);”

(a) Interdicting and restraining the Third Respondent, from interfering with or preventing the business of the Applicant, either personally or through the Police or any other person or agency, conducted under the name and style of “Mermaids” from its premises at 5b Pretorius Street, Fochville

(b) Alternatively to the above, declaring that the business of the Applicant pertaining to the manner and form of operation of entertainment conducted under the name and style “Mermaids” from the premises situated at 5b Pretorius Street, Fochville fall outside the scope ambit of Section 50 of the North West Gambling Act, Act 2 of 2001.

Further and/or alternative relief.

That the First, Second, Third Respondents be ordered to pay the Applicant’s costs jointly and severally, the one paying, the others to be absolved (only in the event of the opposition of this application);”

The Notice of Motion was filed with the Registrar and served on the Respondents on the 28th August 2002. The Answering Affidavit on behalf of the Sixth Respondent was deposed to on the 26th June 2003. The First and the Third Respondents deposed to their Confirmatory Affidavits to the Answering Affidavit of the Third Respondent on the 2nd July 2003 and 7th July 2003 respectively. The Applicant set the matter down on the 13th June 2003 for hearing on the 24th July 2003. This Notice was served on the State Attorney on the 13 June 2003 as attorney of record for First, Second, Third and Fourth Respondents. A Notice of Application for Condonation of the late filing of the Answering Affidavits and leave to oppose the application on the merits was filed with the Registrar on the 23rd July 2003 on behalf of the First, Second and Third Respondents. The Applicant filed her Replying Affidavits to the Answering Affidavits during August 2003, and Notice of Opposition to the Application for Condonation, submitting that the condonation should be dismissed with costs on an attorney and client scale. She further submits that such order for costs be made against the First, Second, and Third Respondents, irrespective of the outcome of the Application for Condonation. The First, Second and Third Respondents shall hereinafter be cumulatively referred to as Respondents.

At the hearing of this Application on the 18th September 2003, Mr Jagga, on behalf of the Applicant, took a preliminary point on the late filing of the Answering Affidavits submitting that the Respondents have failed to show any good cause for the non-compliance with the Rules of this Court and therefore requested the Court to disallow the Answering Affidavits. I must here pause to remark that the fact that the Answering Affidavits were filed out of time was an irregular step which would have entitled the Applicant to bring an Application in terms of Rule 30 of the Uniform Rules of this Court (the Rules). Despite the irregular proceeding adopted by the Respondents, the Applicant filed a Replying Affidavit without notifying the Respondents to remove the cause of complaint in accordance with Rule 30 (2) of the Rules. I ordered that this Application be argued together with the Main Application. In deciding whether to admit the Answering Affidavits, I will deal with the merits of the case and assess the Respondents’ prospects of success in their defence on the law and the facts as well as consider compensation to the Applicant through a suitable order of costs if it can be proved that she was prejudiced by the indulgence. Compare Du Plooy v Anwes Motors (Edms) Bpk 1983 (4) SA 213 (O) at 216 H - 217 D. Background Information The Applicant alleged that she conducts an entertainment business by operating certain machines which offer amusement to the members of the public without allowing them (customers) to gamble.

At the hearing of this Application on the 18th September 2003, Mr Jagga, on behalf of the Applicant, took a preliminary point on the late filing of the Answering Affidavits submitting that the Respondents have failed to show any good cause for the non-compliance with the Rules of this Court and therefore requested the Court to disallow the Answering Affidavits. I must here pause to remark that the fact that the Answering Affidavits were filed out of time was an irregular step which would have entitled the Applicant to bring an Application in terms of Rule 30 of the Uniform Rules of this Court (the Rules). Despite the irregular proceeding adopted by the Respondents, the Applicant filed a Replying Affidavit without notifying the Respondents to remove the cause of complaint in accordance with Rule 30 (2) of the Rules. I ordered that this Application be argued together with the Main Application.

In deciding whether to admit the Answering Affidavits, I will deal with the merits of the case and assess the Respondents’ prospects of success in their defence on the law and the facts as well as consider compensation to the Applicant through a suitable order of costs if it can be proved that she was prejudiced by the indulgence. Compare Du Plooy v Anwes Motors (Edms) Bpk 1983 (4) SA 213 (O) at 216 H - 217 D.

Background Information

The Applicant alleged that she conducts an entertainment business by operating certain machines which offer amusement to the members of the public without allowing them (customers) to gamble.

She further alleged that the machines are operated by way of inserting tokens which do not represent a cash value and the player who wins more tokens during the game would be allowed to play more games. These tokens cannot be exchanged for cash or anything of value. She further alleged that in view of the kind of business conducted by her, it is not correct that she is conducting an unlawful gambling business in contravention of section 50 of the North West Gambling Act No 2 of 2001 (The Gambling Act of 2001). The legal issues raised by the Applicant in her founding affidavit are: (a) That the North West Provincial Government was not empowered to legislate on recreational issues and matters concerning entertainment; (b) That the First Respondent (Premier) did not apply his mind when he decided to put the Gambling Act of 2001 into operation by way of proclamation for the following reasons: (i) He failed to furnish the Applicant with reasons for putting the proclamation into operation on the 2nd April 2002, having received such a request to furnish same from her attorneys of record; (ii) He failed to give reasons for not putting section 66 of the Gambling Act of 2001 into operation and (iii) he failed to give reasons for putting all the other sections of the North West Gambling Act of 2001 into operation.

She further alleged that the machines are operated by way of inserting tokens which do not represent a cash value and the player who wins more tokens during the game would be allowed to play more games. These tokens cannot be exchanged for cash or anything of value. She further alleged that in view of the kind of business conducted by her, it is not correct that she is conducting an unlawful gambling business in contravention of section 50 of the North West Gambling Act No 2 of 2001 (The Gambling Act of 2001).

The legal issues raised by the Applicant in her founding affidavit are:

(a) That the North West Provincial Government was not empowered to legislate on recreational issues and matters concerning entertainment;

(b) That the First Respondent (Premier) did not apply his mind when he decided to put the Gambling Act of 2001 into operation by way of proclamation for the following reasons:

(i) He failed to furnish the Applicant with reasons for putting the proclamation into operation on the 2nd April 2002, having received such a request to furnish same from her attorneys of record;

(ii) He failed to give reasons for not putting section 66 of the Gambling Act of 2001 into operation and

(iii) he failed to give reasons for putting all the other sections of the North West Gambling Act of 2001 into operation.

The Applicant submited that as a result of the above irregularities, the Proclamation No 3 published in the Government Gazette No 5754 of 29th April 2002 (Proclamation) wherein the Premier put the Gambling Act of 2001 into operation should be set aside. The Applicant further alleged that the Fifth Respondent (Tusk Resorts) and the Sixth Respondent (Sun International (SA)), are exempted from the provisions of section 66 of the Gambling Act, which was not put into operation despite the fact that the purpose of the Gambling Act of 2001 was to regulate Casinos. She further averred that the Gambling Act of 2001 was not applied in a uniform or fair manner in that Tusk Resorts and Sun International (SA) are allowed to use entertainment machines on their premises without being holders of a licence to conduct same.

The Applicant submited that as a result of the above irregularities, the Proclamation No 3 published in the Government Gazette No 5754 of 29th April 2002 (Proclamation) wherein the Premier put the Gambling Act of 2001 into operation should be set aside.

The Applicant further alleged that the Fifth Respondent (Tusk Resorts) and the Sixth Respondent (Sun International (SA)), are exempted from the provisions of section 66 of the Gambling Act, which was not put into operation despite the fact that the purpose of the Gambling Act of 2001 was to regulate Casinos. She further averred that the Gambling Act of 2001 was not applied in a uniform or fair manner in that Tusk Resorts and Sun International (SA) are allowed to use entertainment machines on their premises without being holders of a licence to conduct same.

No relief is sought from the Fourth Respondent, who is the Chairman of the National Gambling Board of the Republic of South Africa (National Gambling Board),Tusk Resorts and Sun International (SA). Sun International (SA) filed an answering affidavit wherein it clarified the fact that it does not own or operate any “entertainment machines”, correctly referred to as amusement

machines in section 51 of the Gambling Act of 2001. They further averred that the correct position is that the amusement machines on its premises at Sun City, Morula Sun and Carousel, belonged to The Magic Company (Pty) Ltd (“the Magic Company”) which is a legal entity in which Sun International (SA) had no interest. Sun International (SA) had in actual fact leased its premises to Magic Company wherein they conduct their business. The Applicant did not pursue this issue having been enlightened about the correct facts. Sun International (SA) further made submissions on the legal implications which may ensue and adversely affect its business operations if the proclamation which put the Gambling Act of 2001 into operation were to be set aside as requested in Prayer 1 of the Notice of Motion. I will deal with this aspect later. Moja, on behalf of the Respondents alleged in her founding papers that with regard to the Applicant’s machines, that the description given by the Applicant is misleading; that investigations were conducted at the business premises of the Applicant on the 28th November 2002 by the officials of the Gambling Board and the Technical Manager of Universal Distributors of Nevada SA, which is one of the biggest manufacturers and suppliers of slot and gambling machines. The results of the inspection and the tests revealed that the games and software in the machines operated at the Applicant’s business premises were designed and written for the sole purpose of gambling. Moja further alleged that during the inspection, advertisements relating to a roulette and poker business were displayed in the business premises as well as substantial prizes to be won by the patrons. The Reports of the investigations and the advertisements are attached to her founding papers.

No relief is sought from the Fourth Respondent, who is the Chairman of the National Gambling Board of the Republic of South Africa (National Gambling Board),Tusk Resorts and Sun International (SA). Sun International (SA) filed an answering affidavit wherein it clarified the fact that it does not own or operate any “entertainment machines”, correctly referred to as amusement

machines in section 51 of the Gambling Act of 2001. They further averred that the correct position is that the amusement machines on its premises at Sun City, Morula Sun and Carousel, belonged to The Magic Company (Pty) Ltd (“the Magic Company”) which is a legal entity in which Sun International (SA) had no interest. Sun International (SA) had in actual fact leased its premises to Magic Company wherein they conduct their business. The Applicant did not pursue this issue having been enlightened about the correct facts. Sun International (SA) further made submissions on the legal implications which may ensue and adversely affect its business operations if the proclamation which put the Gambling Act of 2001 into operation were to be set aside as requested in Prayer 1 of the Notice of Motion. I will deal with this aspect later.

Moja, on behalf of the Respondents alleged in her founding papers that with regard to the Applicant’s machines, that the description given by the Applicant is misleading; that investigations were conducted at the business premises of the Applicant on the 28th November 2002 by the officials of the Gambling Board and the Technical Manager of Universal Distributors of Nevada SA, which is one of the biggest manufacturers and suppliers of slot and gambling machines. The results of the inspection and the tests revealed that the games and software in the machines operated at the Applicant’s business premises were designed and written for the sole purpose of gambling. Moja further alleged that during the inspection, advertisements relating to a roulette and poker business were displayed in the business premises as well as substantial prizes to be won by the patrons. The Reports of the investigations and the advertisements are attached to her founding papers.

Subsequent to this inspection officials of the Provincial Gambling Board conducted an operation on the 3rd December 2002, from which it was established that the machines were operated for gambling purposes and that the tokens won were credited in a form of cash to the winner. She further alleged that it was as a result of the investigations conducted that the Board decided to take action against the Applicant and others conducting similar operations. The Applicant admits in her Replying Affidavit that some of the machines operated at her premises were in their original form gambling machines, which were converted and utilised in such a way that they cannot offer any win of a monetary value, but that tokens were used for the purpose of operating the machines which do not represent any cash value. It is alleged by the Applicant that the Premier did not apply his mind when he put the Act into operation, which included putting sections 50 and 51 of the Gambling Act of 2001 into operation and not putting section 66 of the same Act into operation. I must here state that I found it difficult to comprehend the grounds advanced therefor but will attempt to summarize them hereunder:

Subsequent to this inspection officials of the Provincial Gambling Board conducted an operation on the 3rd December 2002, from which it was established that the machines were operated for gambling purposes and that the tokens won were credited in a form of cash to the winner. She further alleged that it was as a result of the investigations conducted that the Board decided to take action against the Applicant and others conducting similar operations.

The Applicant admits in her Replying Affidavit that some of the machines operated at her premises were in their original form gambling machines, which were converted and utilised in such a way that they cannot offer any win of a monetary value, but that tokens were used for the purpose of operating the machines which do not represent any cash value.

It is alleged by the Applicant that the Premier did not apply his mind when he put the Act into operation, which included putting sections 50 and 51 of the Gambling Act of 2001 into operation and not putting section 66 of the same Act into operation. I must here state that I found it difficult to comprehend the grounds advanced therefor but will attempt to summarize them hereunder:

Firstly, it is the Applicant’s contention that section 66 of the Gambling Act of 2001 regulates Casinos or gambling machines and devices, and yet the Premier did not put this section into operation. According to her, to accuse her of conducting an unlawful gambling business in contravention of section 50 of the Gambling Act of 2001 is discriminatory against her in view of the fact that Tusk Resorts and Sun International (SA) are operating a casino business without being regulated. Secondly, she conducts a business that offers “amusement to members of the public by making available to them certain machines for entertainment; that (at her) business premises (she) provide(s) entertainment which is similar to that found at certain casinos but without allowing customers to gamble.” Section 51 of the Gambling Act of 2001 provides for an amusement machine licence.

She submits that “the North West Province is not entitled by virtue of the provisions of the Constitution of South Africa to legislate and regulate amusement machines and facilities.” Her submission is that section 51 was enacted ultra vires. On failure to put section 66 into operation. Prior to the enactment of the Gambling Act No 2 of 2001, gambling and casino licences were regulated by the Bophuthatswana Casino Act No 19 of 1977. (Bophuthatswana Casino Act). The latter Act was repealed by section 92 of the North West Casino, Gambling and Betting Act No 13 of 1994 (Casino Act of 1994). Sun International (SA) casino licences were issued in terms of the Bophuthatswana Casino Act. Sun International (SA) Casino licences in the North West Province were deemed to have been issued in terms of the Casino Act of 1994 which provides in section 51 thereof that:

Firstly, it is the Applicant’s contention that section 66 of the Gambling Act of 2001 regulates Casinos or gambling machines and devices, and yet the Premier did not put this section into operation. According to her, to accuse her of conducting an unlawful gambling business in contravention of section 50 of the Gambling Act of 2001 is discriminatory against her in view of the fact that Tusk Resorts and Sun International (SA) are operating a casino business without being regulated.

Secondly, she conducts a business that offers “amusement to members of the public by making available to them certain machines for entertainment; that (at her) business premises (she) provide(s) entertainment which is similar to that found at certain casinos but without allowing customers to gamble.” Section 51 of the Gambling Act of 2001 provides for an amusement machine licence.

She submits that “the North West Province is not entitled by virtue of the provisions of the Constitution of South Africa to legislate and regulate amusement machines and facilities.” Her submission is that section 51 was enacted ultra vires.

On failure to put section 66 into operation.

Prior to the enactment of the Gambling Act No 2 of 2001, gambling and casino licences were regulated by the Bophuthatswana Casino Act No 19 of 1977. (Bophuthatswana Casino Act). The latter Act was repealed by section 92 of the North West Casino, Gambling and Betting Act No 13 of 1994 (Casino Act of 1994). Sun International (SA) casino licences were issued in terms of the Bophuthatswana Casino Act.

Sun International (SA) Casino licences in the North West Province were deemed to have been issued in terms of the Casino Act of 1994 which provides in section 51 thereof that:

“Any licence for the operation of a casino issued in terms of the Bophuthatswana Casino Act, 1977 as amended, shall be deemed to have been issued in terms of this Act, and the renewal of any such licence shall be dealt with in accordance with the provisions of this Act.” The Casino Act of 1994 was repealed by the Gambling Act of 2001, section 92 thereof. Section 91 (1) of this Act provides that: “All licences issued in terms of any Act which is repealed by this Act, and any licence for the operation of a casino issued in terms of the Bophuthatswana Casino Act, 1977 (Act No 19 of 1977) as amended and in force immediately before the date of commencement of this Act, including any transfers made in respect of some of those licences, shall be deemed to have been issued in terms of this Act after the provisions of this Act shall apply in respect of such licences and transfers.”

“Any licence for the operation of a casino issued in terms of the Bophuthatswana Casino Act, 1977 as amended, shall be deemed to have been issued in terms of this Act, and the renewal of any such licence shall be dealt with in accordance with the provisions of this Act.”

The Casino Act of 1994 was repealed by the Gambling Act of 2001, section 92 thereof.

Section 91 (1) of this Act provides that:

“All licences issued in terms of any Act which is repealed by this Act, and any licence for the operation of a casino issued in terms of the Bophuthatswana Casino Act, 1977 (Act No 19 of 1977) as amended and in force immediately before the date of commencement of this Act, including any transfers made in respect of some of those licences, shall be deemed to have been issued in terms of this Act after the provisions of this Act shall apply in respect of such licences and transfers.”

The effect of the provisions of section 91 (1) in respect of Sun International (SA) is that its casino licences continue to exist and are deemed to have been issued in terms of the Gambling Act of 2001, which licences are regulated by this Act. Failure by the Premier to put section 66 of the Gambling Act of 2001 into operation does not affect the validity of the licences issued to Sun International (SA) in view of the provisions of section 91 (1) of the Act. The Applicant has not made an application for a casino licence in accordance with the Gambling Act of 2001 or the previous Acts which were repealed by this Act. She disputes the fact that she is conducting a casino or gambling business. It is not her case that she has suffered prejudice due to the Premier’s failure to put section 66 into operation. In her founding papers, the Applicant does not refer to the previous Acts dealing with casino licences and the bearing they may have on the licences issued to Sun International (SA) and Tusk Resorts. The bald and unsubstantiated allegations with regard to the Premier’s failure to put section 66 into operation were not well researched by the Applicant and I accordingly find that they are unfounded and of no substance. Needless to say that the North West Province’s full quota of five casino licences were allocated to Tusk Resorts and Sun International (SA) in accordance with section 13 (1) (i) (viii) of the National Gambling Act No 33 of 1996, which fact is not disputed by the Applicant in her founding papers. Was the Premier obliged to give reasons for not putting section 66 into operation?

The effect of the provisions of section 91 (1) in respect of Sun International (SA) is that its casino licences continue to exist and are deemed to have been issued in terms of the Gambling Act of 2001, which licences are regulated by this Act. Failure by the Premier to put section 66 of the Gambling Act of 2001 into operation does not affect the validity of the licences issued to Sun International (SA) in view of the provisions of section 91 (1) of the Act.

The Applicant has not made an application for a casino licence in accordance with the Gambling Act of 2001 or the previous Acts which were repealed by this Act. She disputes the fact that she is conducting a casino or gambling business. It is not her case that she has suffered prejudice due to the Premier’s failure to put section 66 into operation. In her founding papers, the Applicant does not refer to the previous Acts dealing with casino licences and the bearing they may have on the licences issued to Sun International (SA) and Tusk Resorts. The bald and unsubstantiated allegations with regard to the Premier’s failure to put section 66 into operation were not well researched by the Applicant and I accordingly find that they are unfounded and of no substance. Needless to say that the North West Province’s full quota of five casino licences were allocated to Tusk Resorts and Sun International (SA) in accordance with section 13 (1) (i) (viii) of the National Gambling Act No 33 of 1996, which fact is not disputed by the Applicant in her founding papers.

Was the Premier obliged to give reasons for not putting section 66 into operation?

It is submitted by Mr Jagga on behalf of the Applicant that the Premier, in putting the Gambling Act of 2001 into operation, was exercising an administrative action and was therefore obliged to give reasons or an explanation for his conduct, that is, for implementing only certain sections of the Act. In the case of Pharmaceutical Manufacturers of SA: In Re Ex parte President of the Republic of SA [2000] ZACC 1; 2000 (2) SA 674 (CC), Chaskalson P, on p 706 (79) said the following with regard to the President’s power to put an Act of Parliament into operation: “The power is derived from legislation and is close to administrative process. In my view, however, the decision to bring the law into operation did not constitute administrative action. When he purported to exercise the power the President was neither making the law nor administering it. Parliament had made the law and the Executive would administer it once it had been brought into force.” These remarks are apposite to the Premier’s powers when putting a Provincial Act into operation. The Premier did not put section 66 of the Act into operation and in doing so, was not obliged to furnish any reasons whatsoever for not doing so. As I have already stated above, casino licences were provided for and issued in accordance with section 91 (1) of the Gambling Act of 2001.

It is submitted by Mr Jagga on behalf of the Applicant that the Premier, in putting the Gambling Act of 2001 into operation, was exercising an administrative action and was therefore obliged to give reasons or an explanation for his conduct, that is, for implementing only certain sections of the Act.

In the case of Pharmaceutical Manufacturers of SA: In Re Ex parte President of the Republic of SA [2000] ZACC 1; 2000 (2) SA 674 (CC), Chaskalson P, on p 706 (79) said the following with regard to the President’s power to put an Act of Parliament into operation:

“The power is derived from legislation and is close to administrative process. In my view, however, the decision to bring the law into operation did not constitute administrative action. When he purported to exercise the power the President was neither making the law nor administering it. Parliament had made the law and the Executive would administer it once it had been brought into force.” These remarks are apposite to the Premier’s powers when putting a Provincial Act into operation.

The Premier did not put section 66 of the Act into operation and in doing so, was not obliged to furnish any reasons whatsoever for not doing so. As I have already stated above, casino licences were provided for and issued in accordance with section 91 (1) of the Gambling Act of 2001.

The fact that the Applicant is not satisfied with certain sections in the Act does not make the whole Act invalid. I must here pause to state that subsequent to the institution of these proceedings section 66 was put into operation on the 15 March 2003, and the Regulations were promulgated in terms of General Notice 353 of 2002 dated 25 November 2002. I accordingly find that the Act was validly put into operation. Is section 51 of the Gambling Act of 2001 unconstitutional and therefore null and void? Applicant raised two legal issues with regard to the provisions of section 51: Firstly, that the North West Provincial Legislature does not have the competence to “regulate” on amusement machines and facilities and as a result the enactment of the section was ultra vires; Secondly, that section 51 was put into operation without any regulatory infrastructure in connection with the Act being put in place. On the competence of the North West Provincial Legislature to legislate on amusement machines:

The fact that the Applicant is not satisfied with certain sections in the Act does not make the whole Act invalid. I must here pause to state that subsequent to the institution of these proceedings section 66 was put into operation on the 15 March 2003, and the Regulations were promulgated in terms of General Notice 353 of 2002 dated 25 November 2002. I accordingly find that the Act was validly put into operation.

Is section 51 of the Gambling Act of 2001 unconstitutional and therefore null and void?

Applicant raised two legal issues with regard to the provisions of section 51:

Firstly, that the North West Provincial Legislature does not have the competence to “regulate” on amusement machines and facilities and as a result the enactment of the section was ultra vires;

Secondly, that section 51 was put into operation without any regulatory infrastructure in connection with the Act being put in place.

On the competence of the North West Provincial Legislature to legislate on amusement machines:

Applicant submitted that the Province only has powers to regulate on matters stated in Schedule 3 and 4 of the Constitution, which do not include amusement machines. On the other hand, Mr Potgieter on behalf of the Respondents, contends that Schedule 5 Part B of the Constitution reserves, amongst others, amusement facilities as a functional area of exclusive provincial legislative competence, which is a local government matter to the extent set out for provinces in section 155 (6) (a) and (7). Section 155 (6) (a) empowers the provincial government to establish municipalities in the province and to legislate for the monitoring and support of local government in the province, and Section 155 (7) of the Constitution provides that: “........... the provincial governments have the legislative and executive authority to see to the effective performance of municipalities of their functions in respect of matters listed in Schedules 4 and 5, by regulating the exercise by municipalities of their executive authority referred to in section 156 (1).” Section 156 (1) of the Constitution provides that: “(1) A municipality has executive authority in respect of, and the right to administer - (a) the local government matters listed in Part B of Schedule 4 and Part B of Schedule 5; and (b) any other matter assigned to it by national or provincial legislation.”

Applicant submitted that the Province only has powers to regulate on matters stated in Schedule 3 and 4 of the Constitution, which do not include amusement machines. On the other hand, Mr Potgieter on behalf of the Respondents, contends that Schedule 5 Part B of the Constitution reserves, amongst others, amusement facilities as a functional area of exclusive provincial legislative competence, which is a local government matter to the extent set out for provinces in section 155 (6) (a) and (7). Section 155 (6) (a) empowers the provincial government to establish municipalities in the province and to legislate for the monitoring and support of local government in the province, and

Section 155 (7) of the Constitution provides that:

“........... the provincial governments have the legislative and executive authority to see to the effective performance of municipalities of their functions in respect of matters listed in Schedules 4 and 5, by regulating the exercise by municipalities of their executive authority referred to in section 156 (1).”

Section 156 (1) of the Constitution provides that:

“(1) A municipality has executive authority in respect of, and the right to administer -

(a) the local government matters listed in Part B of Schedule 4 and Part B of Schedule 5; and

(b) any other matter assigned to it by national or provincial legislation.”

The wide functional competences exclusively accorded to the Provincial Legislature in Schedule 5 Part A and B, have the potential of overlapping; for instance “recreation and amenities” in Part B may include “amusement facilities” referred to in Part B. Amusement facilities are not defined in Schedule 5, but amusement and entertainment carry almost the same meaning. The Applicant has described her machines as offering “amusement to members of the public.” In section 1 of the Gambling Act of 2001, amusement machines are defined as “any mechanical, electrical, electromechanical; video or other device, contrivance or machine on

which an amusement game may be played but excludes any machine, contrivance or device the same as derived from or converted from a gambling machine of a type found in a casino.” Amusement facilities may refer to the equipment from which the amusement is derived or a building that provides a convenience or serves the particular purpose. According to the Applicant, she provides both the building and the amusement machines which are the facilities from which the patrons amuse themselves at a fee. I was not persuaded and find no substance in Mr Jagga’s argument, with regard to the lack of competence by the Provincial Legislature to regulate amusement machines as “amusement facilities.” To say that section 51 was misplaced in the Gambling Act of 2001, as was submitted by Mr Jagga, does not take the argument any further in view of the fact that the North West Province had the competence to legislate on that issue.

The wide functional competences exclusively accorded to the Provincial Legislature in Schedule 5 Part A and B, have the potential of overlapping; for instance “recreation and amenities” in Part B may include “amusement facilities” referred to in Part B.

Amusement facilities are not defined in Schedule 5, but amusement and entertainment carry almost the same meaning. The Applicant has described her machines as offering “amusement to members of the public.” In section 1 of the Gambling Act of 2001, amusement machines are defined as “any mechanical, electrical, electromechanical; video or other device, contrivance or machine on

which an amusement game may be played but excludes any machine, contrivance or device the same as derived from or converted from a gambling machine of a type found in a casino.”

Amusement facilities may refer to the equipment from which the amusement is derived or a building that provides a convenience or serves the particular purpose. According to the Applicant, she provides both the building and the amusement machines which are the facilities from which the patrons amuse themselves at a fee.

I was not persuaded and find no substance in Mr Jagga’s argument, with regard to the lack of competence by the Provincial Legislature to regulate amusement machines as “amusement facilities.” To say that section 51 was misplaced in the Gambling Act of 2001, as was submitted by Mr Jagga, does not take the argument any further in view of the fact that the North West Province had the competence to legislate on that issue.

On putting section 51 into operation without promulgating regulations: The Third Respondent alleged that when the Gambling Act of 2001 commenced on the 30th April 2002 in terms of the Proclamation dated 29 April 2002, the Regulations to the Act were not yet promulgated. She further alleged that they (The Regulations) had been timeously prepared by the Gambling Board but that the promulgation thereof had been delayed due to unforseen circumstances which resulted in them being promulgated in terms of General Notice No 353 of 2002 dated 25 November 2002. The Premier attested to a confirmatory Affidavit on this aspect. It submitted on behalf of the Applicant that it was a fatal flaw on the part of the Premier to put the Act, in particular section 51 into operation without regulations being published in terms of the North West Gambling Act of 2001, especially those providing for the procedure to be followed in applying for a licence to operate an amusement machine. Reliance is placed on the Pharmaceutical Manufacturers Association case supra.

On putting section 51 into operation without promulgating regulations:

The Third Respondent alleged that when the Gambling Act of 2001 commenced on the 30th April 2002 in terms of the Proclamation dated 29 April 2002, the Regulations to the Act were not yet promulgated. She further alleged that they (The Regulations) had been timeously prepared by the Gambling Board but that the promulgation thereof had been delayed due to unforseen circumstances which resulted in them being promulgated in terms of General Notice No 353 of 2002 dated 25 November 2002. The Premier attested to a confirmatory Affidavit on this aspect.

It submitted on behalf of the Applicant that it was a fatal flaw on the part of the Premier to put the Act, in particular section 51 into operation without regulations being published in terms of the North West Gambling Act of 2001, especially those providing for the procedure to be followed in applying for a licence to operate an amusement machine. Reliance is placed on the Pharmaceutical Manufacturers Association case supra.

On p 706 paragraph (80) of the Pharmaceutical Manufacturers Association case supra, Chaskalson held that “In providing that the Act would only come into force on a date to be determined by the President, Parliament indicated that it considered that it might be inappropriate to bring the Act into force immediately. It vested in the President the power to determine the appropriate time for this to be done. Where no criteria have expressly been set for such a decision, I agree with the view expressed by Sir Thomas Bingham in his judgment in the Court of Appeal in the Fire Brigades Union case that the power to bring legislation into force is one that imposes a duty “.......... to bring the provisions into force as soon as he might properly judge it to be appropriate to do so. In making that judgment he would be entitled to have regard to all relevant factors. These would plainly include the time needed to make preparations and prepare subordinate legislation (and other matters relevant to the coming into force of that legislation).” In this matter, the flaw in putting the Gambling Act of 2001 into operation without having promulgated Regulations was remedied by the subsequent promulgation of the Regulations in the Proclamation of the 25 November 2002. When the Applicant filed this Application with the Registrar on the 28th August 2002, she had not made any attempt to apply for a licencee in terms of section 51. Reference is made to a letter dated 15 May 2002 written by the Applicant’s attorneys of record for an “Application for an amusement machine licence.” This letter is written to the Third Respondent on behalf of Outdoor Excursions CC. There is nothing on the Applicant’s Founding Affidavit which suggests that she is in any way connected to the Outdoor Excursions CC.

On p 706 paragraph (80) of the Pharmaceutical Manufacturers Association case supra, Chaskalson held that “In providing that the Act would only come into force on a date to be determined by the President, Parliament indicated that it considered that it might be inappropriate to bring the Act into force immediately. It vested in the President the power to determine the appropriate time for this to be done. Where no criteria have expressly been set for such a decision, I agree with the view expressed by Sir Thomas Bingham in his judgment in the Court of Appeal in the Fire Brigades Union case that the power to bring legislation into force is one that imposes a duty “.......... to bring the provisions into force as soon as he might properly judge it to be appropriate to do so. In making that judgment he would be entitled to have regard to all relevant factors. These would plainly include the time needed to make preparations and prepare subordinate legislation (and other matters relevant to the coming into force of that legislation).”

In this matter, the flaw in putting the Gambling Act of 2001 into operation without having promulgated Regulations was remedied by the subsequent promulgation of the Regulations in the Proclamation of the 25 November 2002. When the Applicant filed this Application with the Registrar on the 28th August 2002, she had not made any attempt to apply for a licencee in terms of section 51. Reference is made to a letter dated 15 May 2002 written by the Applicant’s attorneys of record for an “Application for an amusement machine licence.” This letter is written to the Third Respondent on behalf of Outdoor Excursions CC. There is nothing on the Applicant’s Founding Affidavit which suggests that she is in any way connected to the Outdoor Excursions CC.

When the Regulations were promulgated on the 25th November 2002, after the Applicant had filed the Application with the Registrar on the 28 August 2002, no attempt was made by the Applicant to apply for a licence in accordance with section 51. The Applicant set the matter down on the 13th June 2003 for hearing on the 24 July 2003, despite the fact that the Regulations were now promulgated. The attitude adopted by the Applicant, it would seem, was that the Provincial Legislature did not have the competence to legislate on the amusement machines. Contrary to the Applicant’s submission with regard to the kind of machines operated in her business, the Third Respondent maintains that the investigations into the Applicant’s business operations pertained to her conducting an illegal gambling or casino business. According to Moja, investigations were conducted on 28 November 2002 at the Applicant’s business and from the reports submitted it became apparent that she was operating a gambling or casino business.

When the Regulations were promulgated on the 25th November 2002, after the Applicant had filed the Application with the Registrar on the 28 August 2002, no attempt was made by the Applicant to apply for a licence in accordance with section 51. The Applicant set the matter down on the 13th June 2003 for hearing on the 24 July 2003, despite the fact that the Regulations were now promulgated. The attitude adopted by the Applicant, it would seem, was that the Provincial Legislature did not have the competence to legislate on the amusement machines.

Contrary to the Applicant’s submission with regard to the kind of machines operated in her business, the Third Respondent maintains that the investigations into the Applicant’s business operations pertained to her conducting an illegal gambling or casino business. According to Moja, investigations were conducted on 28 November 2002 at the Applicant’s business and from the reports submitted it became apparent that she was operating a gambling or casino business.

As to what transpired during the inspection of the machines at the Applicant’s business premises is a matter of dispute on material facts which cannot be properly resolved on the affidavits filed. What is nevertheless of importance is that the Applicant alleged in her Replying Affidavit that the machines operated at her business premises were in their original form gambling machines, except for the fact that they do not offer any prize or win of value. Again there is a dispute of fact with regard to this aspect between the Applicant and the Respondents which cannot be resolved on the papers. A “gambling machine” is defined in section 1 of the Gambling Act of 2001 as “any mechanical, electrical, video, electronic, electro-mechanical or other device, contrivance or machine which upon insertion of a coin, bank note, electronic credit card, debit card, smart card, token or similar object, or upon payment of any consideration is available to be played or operated and the playing operation of which, whether by reason of the skill of the player or operator or the application of the element of chance or both, may deliver or entitle the person playing or operating the machine to receive cash, property, cheques, merchandise, credit, electronic credits, debits, tokens, tickets or anything of value but does not include an amusement machine.” According to the definition of Amusement Machines referred to above, a machine converted from a gambling machine of a type usually found in a casino cannot qualify as an amusement machine. Furthermore, in respect of the Applicant’s machines, she alleged that a player who wins gets a chance to play by having further credits recorded on the machine, but further concedes that these machines were originally gambling machines converted to amusement machines.

As to what transpired during the inspection of the machines at the Applicant’s business premises is a matter of dispute on material facts which cannot be properly resolved on the affidavits filed. What is nevertheless of importance is that the Applicant alleged in her Replying Affidavit that the machines operated at her business premises were in their original form gambling machines, except for the fact that they do not offer any prize or win of value. Again there is a dispute of fact with regard to this aspect between the Applicant and the Respondents which cannot be resolved on the papers.

A “gambling machine” is defined in section 1 of the Gambling Act of 2001 as “any mechanical, electrical, video, electronic, electro-mechanical or other device, contrivance or machine which upon insertion of a coin, bank note, electronic credit card, debit card, smart card, token or similar object, or upon payment of any consideration is available to be played or operated and the playing operation of which, whether by reason of the skill of the player or operator or the application of the element of chance or both, may deliver or entitle the person playing or operating the machine to receive cash, property, cheques, merchandise, credit, electronic credits, debits, tokens, tickets or anything of value but does not include an amusement machine.”

According to the definition of Amusement Machines referred to above, a machine converted from a gambling machine of a type usually found in a casino cannot qualify as an amusement machine. Furthermore, in respect of the Applicant’s machines, she alleged that a player who wins gets a chance to play by having further credits recorded on the machine, but further concedes that these machines were originally gambling machines converted to amusement machines.

I accordingly find that the North West Province had the competence to enact section 51 of the Gambling Act of 2001, and that such enactment was not unconstitutional. I further find that I am unable to declare that the business of the Applicant falls outside the scope or ambit of section 50 of the Gambling Act of 2001 because of the dispute of fact between the Applicant and the Respondents which cannot be resolved on the papers filed. Is the Applicant entitled to a final interdict? Applicant has failed to persuade this Court that she has a clear right to operate amusement machines, because for that she requires a valid licence in terms of section 51 of the Gambling Act of 2001. There is nothing in her Founding Papers to indicate that any such right, if any, was interfered with by the Third Respondent at the Applicant’s business premises. If indeed the Applicant operated an illegal gambling business in contravention of section 51, it was upon the Third Respondent to charge her in accordance with section 82 (a) of the Gambling Act of 2001, which makes failure to comply with any provisions of this Act an offence. It can therefore not be expected of this Court to restrain the Third Respondent from taking whatever legal action it is entitled to in terms of this Act. I accordingly find that in the absence of a clear right which has been interfered with, the Applicant is not entitled to a restraining order or interdict against the Third Respondent.

I accordingly find that the North West Province had the competence to enact section 51 of the Gambling Act of 2001, and that such enactment was not unconstitutional. I further find that I am unable to declare that the business of the Applicant falls outside the scope or ambit of section 50 of the Gambling Act of 2001 because of the dispute of fact between the Applicant and the Respondents which cannot be resolved on the papers filed.

Is the Applicant entitled to a final interdict?

Applicant has failed to persuade this Court that she has a clear right to operate amusement machines, because for that she requires a valid licence in terms of section 51 of the Gambling Act of 2001.

There is nothing in her Founding Papers to indicate that any such right, if any, was interfered with by the Third Respondent at the Applicant’s business premises. If indeed the Applicant operated an illegal gambling business in contravention of section 51, it was upon the Third Respondent to charge her in accordance with section 82 (a) of the Gambling Act of 2001, which makes failure to comply with any provisions of this Act an offence. It can therefore not be expected of this Court to restrain the Third Respondent from taking whatever legal action it is entitled to in terms of this Act. I accordingly find that in the absence of a clear right which has been interfered with, the Applicant is not entitled to a restraining order or interdict against the Third Respondent.

I find that the Applicant has failed to prove her case on a balance of probabilities both on the facts and the law. For the purpose of the Condonation Application on the late filing of the Answering Affidavit, I am of the view that the First to the Third Respondents had reasonable prospects of success in their defence on the law and the facts. The Respondents have succeeded on the legal issues raised by the Applicant and I cannot find that the Applicant has suffered any prejudice by such late filing of the Answering Affidavits. The cause for concern, especially with regard to an Application for an Amusement licence in terms of section 51, was remedied by the Third Respondent through the promulgation of the Regulations. Despite that, the Applicant opted to set the matter down for hearing. In summary: (a) The Premier, in putting the North West Gambling Act of 2001 into operation, was not performing an administrative action within the meaning of item 23 (2) of the Sixth schedule of the Constitution read with section 5 of the Promotion of Administrative Justice Act No 3 of 2000; (b) The North West Provincial Legislature was empowered and had the competence to legislate on the licences for Amusement Machines;

I find that the Applicant has failed to prove her case on a balance of probabilities both on the facts and the law. For the purpose of the Condonation Application on the late filing of the Answering Affidavit, I am of the view that the First to the Third Respondents had reasonable prospects of success in their defence on the law and the facts. The Respondents have succeeded on the legal issues raised by the Applicant and I cannot find that the Applicant has suffered any prejudice by such late filing of the Answering Affidavits. The cause for concern, especially with regard to an Application for an Amusement licence in terms of section 51, was remedied by the Third Respondent through the promulgation of the Regulations. Despite that, the Applicant opted to set the matter down for hearing.

In summary:

(a) The Premier, in putting the North West Gambling Act of 2001 into operation, was not performing an administrative action within the meaning of item 23 (2) of the Sixth schedule of the Constitution read with section 5 of the Promotion of Administrative Justice Act No 3 of 2000;

(b) The North West Provincial Legislature was empowered and had the competence to legislate on the licences for Amusement Machines;

(c) There is no merit in the submissions raised by the Applicant in respect of section 66 of the North West Gambling Act of 2001; and (d) I am unable to make a finding with regard to the nature of the machines operated at the Applicant’s business premises in view of the dispute of material facts which cannot be resolved on the papers. The Applicant ought to have foreseen that a dispute of fact would arise in this regard. The Applicant can therefore not be entitled to a declaratory order and an interdict. On the costs of this Application: The Applicant ought to have applied for a licence in accordance with section 51 when the Regulations were promulgated in terms of section 84 of the Gambling Act of 2001, instead of setting the matter down as she did; she caused the Sixth Respondent to make representations, having had no basis for the allegations made against the Fifth and Sixth Respondents. Even when the Sixth Respondent wrote a letter to the Applicant’s Attorneys of record wherein the correct factual position affecting the Sixth Respondent’s purported operation of Amusement Machines was clearly explained, the Applicant refused to retract such statements which statements were only withdrawn at the hearing of this application. This is a case where the Sixth Respondent would be entitled to Attorney-and-Client costs occasioned by the Applicant’s conduct.

(c) There is no merit in the submissions raised by the Applicant in respect of section 66 of the North West Gambling Act of 2001; and

(d) I am unable to make a finding with regard to the nature of the machines operated at the Applicant’s business premises in view of the dispute of material facts which cannot be resolved on the papers. The Applicant ought to have foreseen that a dispute of fact would arise in this regard. The Applicant can therefore not be entitled to a declaratory order and an interdict.

On the costs of this Application:

The Applicant ought to have applied for a licence in accordance with section 51 when the Regulations were promulgated in terms of section 84 of the Gambling Act of 2001, instead of setting the matter down as she did; she caused the Sixth Respondent to make representations, having had no basis for the allegations made against the Fifth and Sixth Respondents. Even when the Sixth Respondent wrote a letter to the Applicant’s Attorneys of record wherein the correct factual position affecting the Sixth Respondent’s purported operation of Amusement Machines was clearly explained, the Applicant refused to retract such statements which statements were only withdrawn at the hearing of this application. This is a case where the Sixth Respondent would be entitled to Attorney-and-Client costs occasioned by the Applicant’s conduct.

The successful parties are in this case entitled to an order for costs. I accordingly make the following order: (a) The Application for the orders mentioned in the Notice of Motion is dismissed with costs. (b) The First, Second and Third Respondents’ Application for Condonation for the late filing of the Answering Affidavit is granted; (c) Each party is ordered to pay its own costs in respect of the Condonation brought on behalf of First, Second and Third Respondents; (d) The Applicant is ordered to pay the costs of the Sixth Respondent on an Attorney-and-Client basis.” M M LEEUW JUDGE OF THE HIGH COURT

The successful parties are in this case entitled to an order for costs.

I accordingly make the following order:

(a) The Application for the orders mentioned in the Notice of Motion is dismissed with costs.

(b) The First, Second and Third Respondents’ Application for Condonation for the late filing of the Answering Affidavit is granted;

(c) Each party is ordered to pay its own costs in respect of the Condonation brought on behalf of First, Second and Third Respondents;

(d) The Applicant is ordered to pay the costs of the Sixth Respondent on an Attorney-and-Client basis.”

M M LEEUW

JUDGE OF THE HIGH COURT

ATTORNEYS FOR APPLICANT : NIENABER & WISSING ATTORNEYS FOR 1ST RESPONDENT : STATE ATTORNEYS ATTORNEYS FOR 2ND RESPONDENT : STATE ATTORNEYS ATTORNEYS FOR 3RD RESPONDENT : STATE ATTORNEYS ATTORNEYS FOR 4TH RESPONDENT : STATE ATTORNEYS ATTORNEYS FOR 5TH RESPONDENT : THEODOR ATTORNEYS ATTORNEYS FOR 6TH RESPONDENT : SMIT, STANTON ATTORNEYS

ATTORNEYS FOR APPLICANT : NIENABER & WISSING

ATTORNEYS FOR 1ST RESPONDENT : STATE ATTORNEYS

ATTORNEYS FOR 2ND RESPONDENT : STATE ATTORNEYS

ATTORNEYS FOR 3RD RESPONDENT : STATE ATTORNEYS

ATTORNEYS FOR 4TH RESPONDENT : STATE ATTORNEYS

ATTORNEYS FOR 5TH RESPONDENT : THEODOR ATTORNEYS

ATTORNEYS FOR 6TH RESPONDENT : SMIT, STANTON ATTORNEYS