Magoswa Limestone Limited v The Attorney General (2015/HN/242) [2016] ZMHC 231 (13 May 2016)

'\ IN THE HIGH COURT FOR ZAMBIA AT THE NDOLA DISTRICT REGISTRY HOLDEN AT NDOLA 2015/HN/242 (Civil Jurisdiction) IN THE MATTER OF : AN APPLICATION FOR JUDICIAL REVIEW · IN THE MATTER OF : IN THE MATTER OF: THE MINES AND MINERALS DEVELOPMENT ACT NO 7 OF 2008 OF THE LAWS OF ZAMBIA THE MINES AND MINERALS DEVELOPMENT(GENERAL REGULATIONS), S. I. NO. 84 OF 2008 BETWEEN: For the Applicant : Mr. J . Kauuka - Messrs J. Kabuka & Co For the Defendant : Mr. S . Nsolllboshi- Attorney General's Chambers JUDGMENT J2 Cases referred to: 1. 2. 3. Nyampala Safaris (Z) Ltd and others V Zambia Wildlife Authority and others (2004) ZR 49 Chifuka V Attorney-General (2012) 1 ZR 156 Associated Provincial Picture Houses Limited v. Wednesbury Corporation [1948] 1 K. B. 223 Legislation referred to: 1. Mines and Minerals Development Act No. 7 of 2008 2. Mines and Minerals Development (General) Regulations S. I No 84 of 2008 With leave of the Court the Applicant commenced proceedings for judicial review where the following reliefs were sought: i) An Order quashing the refusal to release the Applicant's d~ly approved mining liGence; ii) A ma....~datory order to direct the respondent to grant the Applicant's mining licence in accordance with the law and 1n accordance with the Applicant's legitimate expectation. iii) A declaration that the decision by the respondent to withhold the Applicant's duly approved licence is erroneous, without justification, irrational, abuse of authority and a violation of Regulations 21, 22, and 23 of the Mines and Minerals Development (General) Regulations S. I No 84 of 2008 and therefore illegal; iv) Damages for consequential loss suffered by the applicant for the duration the Respondent unlawfully wrongfully w ithholds the mining licence; v) vi) Costs of and incidental to these proceedings; and Such further or other relief as the Court may deem fit. J3 The Applicant filed an affidavit verifying facts together with a statement of facts where the grounds on which the relief was sought were set out. The Applicant deposed that in 2013, it applied for mining rights in respect of areas over which it holds prospecting permits no. 16349-HQ-SPP and 16832-HQ-SPP. The applicant was informed by letter dated 20th March 2014 that the application relating to prospecting licence no 16832-HQ-SPP had been approved and licence no 18947-HQ-SML had been issued. But despite several requests, the Respondent has refused to release the licence to the Applicant or furnish any reasons for withholding it. · The substantive ,grounds for the application were as follows; i) That havigg notified the Applicant that the application fo/ a mining licence had been approved, the Respondent had breached the legitimate expectation that the licence would be handed over. ii) That the decision to withhold the licence was erroneous, without justification, irrational, unlawful and abuse of authority. iii) That the Respondent did not have discretionary power to refuse to grant an approved licence and the Court should grant a mandatory order. iv) That the Applicant had expected to derive financial benefit from the mining licence and the delay in granting the same has resulted in the Applicant suffering loss and damage. J4 The Respondent filed an affidavit in opposition which was sworn by one Billy Chewe, the chief mining engineer in the Ministry of Mines, Energy and Water development. He deposed that licence no 1894 7 - HQ-SML was withheld because the prospecting permit to which it related had been withdrawn upon the discovery that there was some overlapping with the area of inter.est for Lafarge Zambia Limited. Mr Chewe deposed that the withdrawal of the prospecting licence had been communicated to the applicant and the licence had been granted in error. The Applicant filed an affidavit in reply wherein it was denied that the prospecting licence N:o.16832-HQ-SSP had been withdrawn as.}t was still 'active' in · th~ system. The Applicant deposed further _ th9 t the prospecting licence it held was obtained under the rights heid ,,, by Katanga Resources Limited which did not share a boundary with Lafarge Zambia. Written skeleton arguments were filed on behalf of both parties. The gist of the argument on behalf of the applicant was that the Respondent had breached its statutory duty by failing to issue and release the approved mining licence to it. The Court was referred to Regulations 21 and 22 of the Mines and Minerals Development (General) Regulations S. I No 84 of 2008 which provides that an applicant should be informed when an application for a mining right has been approved or rejected. The Applicant challenged the purported withdrawal of the prospecting licence as no document was filed to support this assertion. The Applicant contended there JS had been no communic~tion from the Respondent concerning the withdrawal of the licence. It was argued further on behalf of the Applicant that irregularities existed which warranted the remedies sought. The Applicant relied on the case of Derrick Chitala v . the Attorney General ( 1995 -97) ZR 91. The Applicant also submitted that it could not follow the appeal procedure prescribed by Sections 152 and 153 of the Mines and Minerals Development Act No. 7 of 2008 because the application for a mining licence had not been rejected. : In- , response, .:,it was,, ~-kued on behalf of the Respon:dent .. th:~t · . ·· . . ~ ~ >(:. ! ~ - • , . although the Applicartt s9-tisfied the requirements for the grant of~i:3. mining licence, it could not be granted because it was discovered that that the prospecting permit no 16832-HQ-SSP was overlapping the Lafarge Zambia licence area. The Respondent contended that the Applicant should have followed the procedure laid out in Section 10 and Section 152 of the Act if dissatisfied with the withholding of the licence. I have carefully considered the evidence together with the written arguments by both parties. The basic principles underlying the process of judicial review were outlined by the Supreme Court in the case of Nyampala Safaris (Z) Ltd and others V Zambia Wildlife Authority and others (2004) ZR 49 as follows: JG (a) that the remedy of Judicial Review is concerned, not with the merits of the decision, .but with the decision -making process itself. (b) that it 1s important to remember that in every case, the purpose of Judicial Review is to ensure that the individual is given fair treatment by the authority to which he has been subject and that it is not part of that purpose substitute the opinion of the judiciary or of the individual Judges for that of the authority constituted by law to decide the matter 1n question; and (c) that a decision of an inferior court or a public authority may be quashed (by .aµ, order of certiorari) where that court ;\;?r authority acted:- t. ·~ . , I . 1• ·, (i) without jurisdiction; or (ii) exceeded its jurisdiction; or (iii) failed to comply with the rules of natural justice Where those rules are applicable; or (iv) where there is an error of law on the face of the record; or (v) the decision is unreasonable in the Wednesbury sense (1), namely, that it was a decision which no person or body of persons properly directing itself on the relevant law and acting reasonably, could, reasonably have reached. The decision which the applicant seeks to be reviewed is the decision of the Respondent to withhold the issue of an approved mining licence. The evidence shows that by letter dated 20th March J7 2013, which is produced and marked 'MAM6', the Registrar of Mining rights communicated that that application ·for a small scale mining licence had been approved subject to certain terms which included payment of the stated fees. The letter of offer stated that the licence would be released upon payment of the stated fees. The requisite fe.es were paid by the Applicant. The Respondent does not dispute that the Applicant satisfied all the requirements for the issue of the licence but explains that the licence could not be released because it was discovered that the area over which the Respondent was granted mining rights was . . overlapping with anothe1:~right holder.. ~ .. . . -~;; ~ - The Respondent's position is that the prospecting permit No 16832- HQ- SPP was withdrawn due to the above anomaly and the Applicant was notified accordingly. However, I note that the Respondent did not produce the said notification in their pleadings and there is evidence that several letters from the Applicant on the issue went unanswered. The question that fell for determination is whether the decision by the Respondent to withhold the issuing of mining licence 18947- HQ-SML after its approval had been communicated to the Applicant is irrational and an abuse of power. Or in other words was the decision unreasonable in the Wednesbury sense. The Wednesbury principle is that decisions of persons or bodies which perform public duties or functions v.rill be liable to be quashed or otherwise dealt w ith by an appropriate order in judicial review proceedings J8 where the court concludes that the decision is such that no such person . or body properly directing itself on the relevant law and acting reasonably could have reached that decision. This was held in the case of Associated Provincial Picture Houses Limited v. Wednesbury Corporation [1948] 1 K. B. 223 and has been cited with approval in our jurisdiction. The Applicant contends that Regulations 21 and 22 of the Mines and Mineral Development (General) Regulations are couched in peremptory terms and imposes an obligation on the public officer to communicate the decision in application for a mining licence. ' ' Regulation 21 provides as follows: 0 • "The Minister, . Director or Director of Geological Survey, as the case may be, shall, where the Minister, Director or Director of Geological Survey approves an application for a mining right or mineral processing licence, inform the applicant of the approval in Form XIV set out in the Second Schedule." The affidavit evidence of the Applicant shows that this was complied with by the Respondent by letter dated 20th March 2013. In my view there appears to be a misapprehension on the part of the Applicant as to the import of Regulation 21. The regulation does not impose a duty on the Respondent to grant or issue the licence but only imposes a duty to inform. However, the approval letter referred to above did contain an undertaking that the licence would be released upon payment of the J9 stated fees. The last sentence in the third paragraph from the end of the said letter states as follows: "Upon payment of the stated fees the licence shall be released" (emphasis mine) I agree with the Applicant's submission that upon receipt of such a letter there was a legitimate expectation that the licence applied for would be issued. The Respondent has argued or explained that the approved licence was not released to · the Applicant because it was discovered that prospecting permit 16832-HQ-SPP on the basis of which the mining licence had been applied for overlapped with the rights which Lafarge Zambia had over the area. I note that the Respondent's argument addresses the merits of the matter and not the procedure. But as was held in the Nyampala Safaris case, judicial review is concerned with the decision making process and not the merits of the case per se. I expected the Respondent to argue that they had complied with the laid down procedure in withholding the granting of the licence after discovery an anomaly. The Respondent did not produce any evidence to show that the Applicant was informed of the reason why the licence was not released. This would have enabled the applicant to make representation on the issues raised. The Applicant denies that the area over which it holds a prospecting licence overlaps with Lafarge Zambia Limited or that the licence was withdrawn as it is active on the Ministry's website. The Applicant J10 also submits that it obtained the consent of Katanga Resources Limited which holds tenement 8272-HQ-LPL to which the mining rights relate. The failure by the Respondent to notify the Applicant of the anomaly it discovered precluded any i_nvestigations into the matter. Furthermore, the Respondent does ·not indicate what has become of the licence that was approved. From the evidence adduced in this case, I find that the Respondent did not complete the procedure provided for considering an application for a mining licence as provided for in the Act. The notification that the licence had been approved should have been followed with the issuing of the actual licence to the Applicant. The regulations do not provide for a procedure on the withdrawal of the approval of mining licences which have not been issued perhaps because ideally at the time the notice of approval is being sent out, it was assumed that all necessary checks would have been done._ It speaks very poorly of the Ministry if a big issue such as overlapping of areas interest is only discovered after the approval of the application and just before the issue of the licence. The Applicant was not given fair treatment by the Ministry of Mines. It has been argued on behalf of the Respondent tha t the correct procedure tha t should have been followed by Applicant if dissatisfied, should have been to appeal against the decision as provided for in the Act. However, it is my considered view that the procedure laid out in the Act could have only been followed if the Respondent had followed communicated its decis ion to the Applicant. I agree with the submissions by the Applica nt's Counsel .. J11 that the Sections 152 and 153 of the Act prescribe an appeal procedure for a mining right which has been rejected. In this case, the application was not rejected. Further Section 155 on the act places a duty on the Respondent to communicate the decision to the applicant. The Section reads as follows: "Vlhenever the Minister) the Director or any authorised officer makes a decision against which an appeal lies by virtue of a provision of this Part) the licensee or applicant affected by the decision shall be informed by notice in writing of the decision and of the reasons therefore and any such notice shall inform the person so notified of that person)s right of appeal." There is no evidence that this was done in this case. The Applicant could therefore not be expected to appeal against a decision which was not made. Although it is trite that judicial review proceedings will not be allowed where alternative remedies are available, in exceptional circumstances the application can be allowed. In the case of Chifuka V Attorney-General (2012) 1 ZR 156 one of the factors to be considered 1n deciding whether exceptional circumstances existed was whether the alternative statutory remedy will resolve the question at issue fully and directly. In casu, there being no decision to appeal against, an appeal could not have resolved the issues. In view of the foregoing, I find that the applicant has established that the Respondent acted unreasonably in failing to conclude the issuance of a mining licence within a reasonable time after it was J12 approved and thereby breached the legitimate expectation. I find further that in consequence of the Respondent's action, the Applicant has suffered loss and damage. I accordingly order as fallows: a) That the Respondent complete the process with regard to mining licence no 18947-HQ-SML within the next Six weeks from the date of this judgment. Having become aware that there may be technical issues relating to overlapping rights over the same area, I am reluctant to order the release of . approved-mining licence before this issue is fully investigated. b) That the Respondent pays compensatory damages suffered by the Applicant for the duration if wrongfully failed to complete the process. I also award the costs of these proceedings to the Applicant. Delivered at Ndola this .... ~.-:: ....... day of ..... J:.'.~ ........... 2016. ,...,:r-.. 9-- MADAM JUSTICE Y. CHEMBE HIGH COURT JUDGE