High Court finds mineral rights were expropriated

The 2004 Mineral and Petroleum Resources Development Act does imply the expropriation of old-order mineral rights, and therefore holders of the old-order rights may approach the court for compensation.
So ruled the Pretoria High Court in an interlocutory hearing, in the matter of Agri SA and other holders of mineral rights versus the minister of minerals and energy Buyelwa Sonjica.
The ruling could pave the way for claims against the Department of Minerals and Energy (DME).
In 2004 Agri SA was advised that mineral rights, as previously described in the Minerals Act of 1991, were in principle expropriated when the new Act came into effect in early 2004.
For the purposes of the test case, Agri SA has taken cession of a claim by Bulgara Investment Holdings PTY Ltd against the DME for the loss of mineral rights as a result of the Act coming into effect.
The claim against the director general was lodged on 23 March 2006. The DG, however, didn’t respond to it, and on 2 April 2007 Agri SA brought an application against the department and the minister before the Supreme Court in Pretoria. The application was to force the minister and department to react to the claim.
But on July 2007, Agri SA’s legal council received a letter from the department, stating that Agri SA’s claim wasn’t valid in terms of the Act, and no compensation would be paid for the expropriation of mineral rights.
But last week, Judge Willie Hartzenberg ruled in favour of Agri SA and the mineral rights holders, after the minister raised two exceptions against their compensation claim for expropriation of old-order mining rights.
Judge Hartzenberg found it was in fact possible for old-order mineral rights holders to prove their rights had been expropriated by the coming into force of the Act, and rejected the exceptions with costs.
Agri SA executive director Hans van der Merwe said the judgement means a claimant can now turn to the court to confirm expropriation. However, each claimant will still have to prove the extent of their losses as required in the Expropriation Act. DME departmental spokesperson Bheki Khumalo said they are aware of “that judgement”. “The legal team is still studying the judgement, so we can’t make any comments now. We will respond in due course,” he said.
According to Manus Booysen, partner at the Webber Wentzel law firm and head of the natural resources and environmental law practice group, the judgement sets a precedent for future cases. He said there’s room for further test cases on the principles of the Mineral and Petroleum Resources Development Act.
“It is a new act and it changed the common law quite drastically,” he said. “As new cases come forward, it’s possible that other parts of the Act can be tested in court.”
One of the sections in the Act troubling landowners is Section 5, which deals with the rights of access that holders of a prospecting right, a mining right, exploration right or production right, have to land on which the rights are registered.
The section only requires 21 days written notice to a landowner or lawful occupier before the start of mining or exploration operations. – Drieka Burger