A recent judgment of the Constitutional Court which dealt with the situation where a landowner or lawful occupier of land prevents the holder of a prospecting right or a mining right from entering the land or conducting prospecting or mining operations notwithstanding its statutory right to do so, has far-reaching implications for landowners, lawful occupiers of land and mining companies. The judgment reinterprets (or rewrites) the law which applies to such a situation, and limits the application of a previous case decided by the Supreme Court of Appeal (SCA) which mining companies have relied on to enable them to ensure that their operations are not prevented or delayed.
Previously, where a mining company’s operations were stopped, or where a mining company was refused access to the land over which it held a mining right or a prospecting right granted under the Mineral and Petroleum Resources Development Act, 2002 (MPRDA), the conventional wisdom relied on by mining companies was that they could obtain an interdict against the landowner or lawful occupier, on an urgent basis, preventing the denial of access or the interruption of operations. Such urgent application would have been based on the statutory rights of access to land and to conduct operations which inhere in rights granted under the MPRDA, so as to ensure its operations would not be thwarted. While the MPRDA contains a provision which requires the mining company to involve the Department of Mineral Resources (DMR) whenever a dispute with the landowner or occupier of the land occurs, because of what the SCA had found, mining companies believed that they were not required to exhaust the MPRDA’s often cumbersome and delayed internal dispute resolution mechanisms before rushing to court to obtain an interdict against anyone interfering with mining or prospecting operations.
The Constitutional Court’s recent judgment in Maleudu & Others v Itereleng Bakgatla Minerals Resources (Pty) Ltd, however, handed down on 25 October 2018 by Acting Judge Petse (with several other Judges concurring), changes the position.
Whereas the Mineral and Petroleum Resources Development Act, 2002 (MPRDA) entitles the holder of a prospecting right or a mining right to enter the land to which such right relates and to prospect or mine for the mineral for which such right was granted, the Constitutional Court’s judgment has curtailed that right in the course of its interpretation and implementation of section 54 of the MPRDA. Section 54 provides for a mechanism in terms of which a dispute between a landowner or lawful occupier and a mining company is, effectively, mediated by the DMR, and a fair determination of compensation to which the landowner or occupier is entitled for damage to the land caused by the right holder’s operations is determined through negotiation and agreement. If no agreement is reached, and all other options have been exhausted, the land in question can be expropriated so that the mining company can exercise its rights under the MPRDA.
One effect of the Constitutional Court’s decision is that whenever access to land relating to an MPRDA right is prevented by a landowner or lawful occupier, the mining right holder cannot obtain an interdict against such interference without first exhausting the procedure in section 54 of the MPRDA. The only time this would not apply, as we understand the judgment, is when the landowner or lawful occupier is deliberately obstructive and refuses to engage in the procedure envisaged in Section 54 of the MPRDA. Previously MPRDA right holders relied on the SCA judgment of Joubert &others v Maranda Mining Company (Pty) Ltd & others which was often relied on and interpreted to mean that a mining right holder did not have to exhaust the Section 54 procedure before asking a Court for an interdict when a landowner or lawful occupier prevented access to the land or obstructed operations on it. The Constitutional Court disagreed that this is what the Maranda case meant, and pointed out that in the Maranda case, the landowners in question were deliberately obtuse and obstructive, meaning that the MPRDA right holder was not able to follow the Section 54 procedure.
The effect of this aspect of the Constitutional Court’s judgment is likely to be far reaching. It means that whenever a landowner or occupier of land interferes with an MPRDA right holder’s operations, the operations must cease until the process in section 54 of the MPRDA is completed. This means an MPRDA right holder will have to rely on the relevant regional DMR office to resolve the dispute before it can continue with its operations.
While one can understand why a landowner or occupier might be aggrieved by a mining company having access to their land and undertaking damaging operations on it, it must be borne in mind that an MPRDA right to prospect or to mine for minerals can only be granted if the landowner and lawful occupiers were properly and thoroughly consulted with prior to the grant of the application. This consultation usually, if not invariably, entails an agreement being concluded between the landowner and the applicant for an MPRDA right in terms of which the landowner grants access for mining or prospecting purposes to the MPRDA applicant in exchange for compensation. The effect of the recent judgement, however, is that, even if such an agreement has been concluded, if the landowner or lawful occupiers of the land decide later to obstruct access or prevent operations, the mining company will have no recourse other than to follow the procedure set out in section 54 of the MPRDA. The same will apply where traditional communities residing on land held in trust by the Department of Rural Development and Land Reform on behalf of such communities prevent access to mining companies or disrupt their operations. In these circumstances, even where the mining right holder has previously undertaken proper and comprehensive consultation with the Department as well as the communities, and even where it is entitled to access the land in terms of an agreement concluded in the course of such consultations, a mining right holder may not be successful in obtaining an interdict allowing it to undertake its prospecting or mining operations without first having undertaken the procedure set out in Section 54 of the MPRDA.
One thing mining companies might consider in an effort to mitigate the complications introduced by the recent judgment is to see to it that the agreement which they conclude with landowners affords them an express and clear right to enforce their rights of access under the agreement by approaching a court. Perhaps by relying on this contractual right, a mining company could argue that it need not complete the section 54 procedure before enforcing its statutory and contractual rights of access to the land over which it holds n MPRDA right.