Johannesburg - The Constitutional Court will hear argument on Thursday on Agri SA's claim for damages over alleged expropriation of mineral rights.
The application, brought by Agri SA, argues that the Mineral and Petroleum Resources Development Act (MPRDA) abolished the concept of privately held mineral rights.
The Constitutional Court. Picture: Antoine de Ras. Credit: Independent Newspapers
The Act, promulgated in 2004, requires owners of old-order rights to apply to have them converted into new rights.
It vested ownership of mining rights in the State. Agri SA believes this is an expropriation and wants R2 million compensation.
According to the Polity.org website, Agri SA acquired by cession a claim for compensation from the liquidators of a company, Sebenza, which had in turn bought coal rights in 2001.
Sebenza never used these rights and did not acquire a prospecting permit or a mining authorisation under the previous Minerals Act.
They were accordingly unused old order rights for the purposes of the MPRDA. After Sebenza was liquidated, its provisional liquidators tried to sell these rights to a third party in September, 2004, after the MPRDA had commenced.
The sale, for R750,000, became void owing to the introduction of the new Act.
Minister of Minerals and Energy Susan Shabangu rejected the claim for compensation.
The High Court in Pretoria ruled in favour of Agri SA and awarded it R750,000 compensation.
The Supreme Court of Appeal set the ruling aside and held that the Act did not deprive Sebenza of property, and therefore did not amount to an expropriation, and no compensation needed to be paid.
The minister argued that the Act does not expropriate Sebenza’s mineral rights because the “right to mine” has always been vested in the state and the state did not acquire any rights as a consequence of the alleged deprivation.
Four friends of the court have been admitted - AfriForum, Afrisake, Floris Johannes Pool and the Centre for Applied Legal Studies.
They have filed wide-ranging written argument on the correct approach to the case and on the considerations which the court should take into account.
AfriForum, Afrisake and Floris Johannes Pool support Agri SA while the Centre for Applied Legal Studies supports the minister’s position. - Sapa