THE SUPREME COURT OF APPEAL OF SOUTH AFRICA

JUDGMENT

Case no: 254/10

In the matter between:

MORULENG AND DISTRICT TAXI ASSOCIATION
First Appellant
JOHANNES BOITUMELO MOKATSE
Second Appellant

and

NORTH WEST PROVINCIAL DEPARTMENT OF TRANSPORT &
Respondents
27 OTHERS

Neutral citation:
Moruleng and District Taxi Association v North West
Provincial Department of Transport & 27 others (254/10) [2011]
ZASCA 138 (23 September 2011)

Coram:
Harms AP, Maya, Bosielo and Shongwe JJA and Plasket AJA

Heard:
29 August 2011
Delivered:
23 September 2011
Summary:
National Land Transport Transition Act 22 of 2000 – conversion of radius-
based permits into operating licences – requirements – granting of
operating licences reviewed and set aside.

ORDER

On appeal from:  North West High Court (Mafikeng) (Leeuw AJP, Hendricks J and
Kgoele AJ sitting as a court of appeal):

1.
The appeal is upheld.
2.
The fourth to twenty fourth respondents and the twenty sixth respondent shall
pay the appellants’ costs, including the costs of two counsel, jointly and severally,
the one paying, the others to be absolved.

3.
The order of the court below is set aside and replaced with the following order:

(a) The appeal is upheld with costs, including the costs of two counsel.

(b) The order of the court below is set aside and replaced with the following:

(i)
The decision of the second respondent to grant operating licences to the
members of the fourth respondent for the route from Moruleng to
Mogwase and back is reviewed and set aside.
(ii)
The respondents shall pay the costs of the applicants jointly and severally,
the one paying the others to be absolved.

__________________________________________________________________

JUDGMENT
__________________________________________________________________

BOSIELO JA (Harms AP, Maya and Shongwe JJA and Plasket AJA concurring)

[1] This is an appeal against a judgment of the full court of the North West High
Court, Mafikeng (per Hendricks J, Leeuw AJP and Kgoele AJ concurring), in terms of
which the court set aside a judgment of the court of first instance (per Landman J) and
found that the operating licences issued to members of the fourth respondent (the
Mogwase Taxi Association) were properly issued and thus valid. The appeal is with the
leave of this court.

[2] For some time the taxi industry across the country has been plagued by the so-
called taxi wars. These wars, which in many instances resulted in the unnecessary loss
of lives of innocent people who were caught in the cross-fire, revolve primarily around
disputes involving routes. Not surprisingly, the dispute herein revolves around a
disputed claim to provide a mini-bus taxi type service on a particular route. The disputed
route herein is described as the Mogwase–Moruleng taxi route in North West Province.
Members of the first appellant, the Moruleng and District Taxi Association, have the
right to operate the route. Members of the Mogwase Taxi Association applied for the
conversion of their radius-based permits into route-based licences for this route by the
North West Provincial Operating Licence Board (the Board). The applications were
successful and the Moruleng and District Taxi Association then sought to have the
decisions reviewed and set aside.

[3] What follows are the background facts leading to this appeal. The Moruleng and
District Taxi Association and Mogwase Taxi Association are rival taxi associations.
During or about 1983 the members of first appellant broke away from fourth respondent
to form their own separate association. Before the new National Land Transport
Transition Act1 as amended (the NLTTA) was passed, members of both first appellant
and fourth respondent had radius-based permits which authorised them to undertake

1 The National Land Transport Transition Act, 22 of 2000 which came into operation on 1 December
2000. (This was repealed by section 94 of the National Land Transport Act of 2009 which came into
operation on 8 December 2009).

public transport services for commuters on the disputed route. The main purpose of the
NLTTA is to transform and restructure the Republic’s land transport system.
[4] The NLTTA aims to achieve a smooth transition from the old system of radius-
based permits to route-based operating licences, (s 2 of the NLTTA). The old Road
Transportation Act2 provided for radius-based permits; the radius was calculated on
kilometres from a specific point. In terms of this system, a permit holder was authorised
to conduct a taxi business from one point to any destination which fell within the radius
covered by the permit. This system provided a fertile ground for perennial clashes and
concomitant violence between taxi drivers and taxi associations as they fought over
lucrative routes. At one stage the flames of these taxi wars had spread to almost every
part of the country. One assumes that the NLTTA was introduced as an attempt to
regulate the taxi industry better and more efficiently and hopefully to stop the ubiquitous
taxi wars. Undoubtedly, the vision is to convert old taxi permits from the uncertain
radius-based description to a more specific route-based licence. In terms of s 85(3)(f)
and (g) of the NLTTA such an operating licence is required to disclose a detailed route
or routes to be used for operation of the taxi and specifications of the relevant street
names, road numbers, beacons or landmarks for each city, suburb, town, village or
settlement as well as authorised ranks or terminals and other points where passengers
would be picked up or allowed to alight. Clearly this was intended to ensure that each
taxi driver operate strictly within the terms of his or her operating licence.

[5] From as far back as 1998 a dispute had been simmering between the members
of both first appellant and the fourth respondent regarding who was in law entitled to
operate on the disputed route. Many attempts to resolve this dispute through the
intervention of, amongst others, the transport authorities and the local police failed.
Regrettably, at some stage the dispute got out of hand and became violent. In an
attempt to resolve this impasse legally, and acting on the advice of the Registrar of the
Department of Transport, North West Province, members of the fourth respondent

2 The Road Transportation Act 74 of 1977.

applied to the Board in terms of s 79 of the NLTTA for the conversion of their permits
into operating licences for the disputed route to legalise their operations on the disputed
route. The applications were granted.

[6] The appellants instituted review proceedings in the high court to have the
decision of the Board reviewed and set aside on the basis that the operating licences
were not properly issued. Although conceding that members of the fourth respondent
had previously held radius-based permits to operate in the disputed area, the appellants
contended that members of the fourth respondent never operated on the disputed route
as required by s 80(1) of the NLTTA. In their response members of the fourth
respondent denied that the conversion of their taxi permits into operating licences were
not issued properly. Essentially, they asserted that they complied with all the statutory
requirements prescribed by the NLTTA. Concerning the requirements of regular service
as envisaged in s 80(1), the respondents contended that they provided the regular
service as required by the NLTTA as, although they concede that they did not actually
operate on this disputed route, their radius-based permits nonetheless covered the
disputed route before the conversion.

[7] Members of the fourth respondent had also raised a point in limine that the
application for review offended the provisions of s 7 of the Promotion of Administrative
Justice Act 3 of 2000 (PAJA) in that it was not instituted without unreasonable delay and
not later than 180 days after the date, subject to subsection (2)(c), on which any
proceedings instituted in terms of internal remedies as contemplated in subsection
(2)(a) have been concluded or where no such remedies exist, on which the person was
informed of the administrative action; became aware of the action and the reasons for it
or might reasonably have been expected to have become aware of the action and the
reasons.’

[8] The court of first instance upheld the point in limine and dismissed the application
for review. Aggrieved by the judgment, the appellants appealed to the full court, which
found that the court of first instance had erred in upholding the point in limine. The full
court upheld the appeal against the order upholding the point in limine but dismissed the
appeal on the merits.

[9] In refusing the application to review and set aside the decision by the Board to
grant the members of the fourth respondent the conversions, the court below held that
‘it cannot therefore be established that the Mogwase operators did not apply for the
Moruleng–Mogwase route. On the probabilities, they must have applied that is why the
said route is specified on their operating licences.’ Concerning the requirement of a
regular service as contemplated in s 80(1), the court below held that ‘Section 80 does
not cater for a situation where an applicant is prevented from operating on a specific
route in compliance with the stipulated 180 days’ period. That being the case, it must be
accepted on the probabilities that the Mogwase operators did apply to operate on the
said route and that the Board, in the exercise of its discretion, correctly granted the
conversions’. The appellants’ appeal is against these findings. I pause to state that the
first to third respondents (North West Provincial Department of Transport, North West
Provincial Operating Licence Board and the Chairperson of the North West Provincial
Operating Licence Board) are not parties to the appeal.

[10] It is regrettable that we were not furnished with copies of the minutes of each of
the meetings held by the Board where the applications for conversions by members of
the fourth respondent were considered. It appears from the record that these minutes
were lost and could not be found. As a result it was difficult for us to determine with
certainty what factors the Board considered before granting the applications for
conversion. The affidavit of Mr Kubheka, the second respondent’s acting secretary, was
of no use to us because of the paucity of relevant information. This is due to the fact

that he was only employed by second respondent after the conversions had already
been granted.

[11] However, for purposes of this judgment, I am prepared to accept that members
of the fourth respondent did submit applications for the conversion of their radius-based
permits to route-based operating licences in terms of s 79 of the NLTTA. The question
for determination remains whether they met the requirements of the NLTTA, in
particular s 80 thereof.

[12] The application for a conversion of a permit into an operating licence is governed
by s 79 of NLTTA. The relevant parts of the section provide:
‘S 79 Continuation and conversion of existing permits
(1) Subject to this Part, any permit issued for an indefinite period and any permit issued
for a definite period which, on the commencement of this Act, has not yet expired,
remains in force temporarily as provided for in this section.
(2) The holder of such a permit may have it converted to an operating licence in
accordance with this Part by applying for the conversion, in the manner prescribed
by the MEC –
(a) in the case of a permit for an indefinite period, before the expiry of the period
determined by the Minister under s 32(2).’

[13] Section 32(1) provides peremptorily that all permits must be converted to
operating licences by the date mentioned in s 32(2). A failure to apply for a conversion
of a permit will result in such a permit lapsing.

[14] Section 80 in turn sets out a necessary pre-condition for the conversion of a
permit into an operating licence. It reads as follows:
‘S 80 Conversion of permits not allowed in certain circumstances

(1) A permit may not be converted to an operating licence unless the transport service
that it authorises, has been provided on a regular basis for a period of at least 180 days
before the date on which application is made for conversion, except where the permit
was issued less than 180 days before the date of such application.
(2) The applicant must furnish proof to the satisfaction of the board that the requirement
set by subsection (1) has been met, by supplying written confirmation from the relevant
planning authority, or by such other method as the board deems sufficient.’

[15] It should thus be clear that before an application for a conversion of a permit into
an operating licence can be granted, there must be proof to the satisfaction of the
board, that the applicant has provided a transport service for a period of at least 180
days before such application. Such proof must be in the form of a written confirmation
from the relevant planning authority which is in charge of the area where the transport
service is to be provided or any other means that the Board may choose.

[16] There was a debate between the respective counsel regarding the interpretation
to be accorded to s 80(1). Does the section require the transport service to be actually
rendered as submitted by the appellant’s counsel or does it require the mere providing
or making of such transport available as contended for by the respondents’ counsel?

[17] To my mind it is clear from the wording of s 80(1) that the requirement that a
transport service be rendered on a regular basis for at least 180 days before the
application for conversion is the jurisdictional fact which an applicant has to meet. It is a
pre-condition which must be met before an applicant can get a conversion. The
pertinent question to be answered is whether members of the fourth respondent
rendered the required transport service on the disputed route at least 180 days before
they applied for conversion as required by s 80(1). The other question would be whether
they furnished the second respondent with the written confirmation of such transport
service from the relevant planning authority as required by s 80(2).

[18] It is clear to me that the purpose of the section is to ensure proper conversion of
the radius-based permits which were issued in terms of the old legislation to new route-
based operating licences provided for by the NLTTA. In line with s 81(1) of the NLTTA
the conversion is intended to ensure that an applicant for an operating licence retains
the same authority as that which he or she enjoyed under the old permit. The corollary
hereof is that nobody should be granted an operating licence on a route on which he or
she did not operate within the prescribed period. It follows that in order to achieve this,
the board must be satisfied that the particular route was utilised by an applicant before
the application for conversion. This must be done by submitting together with the
application for conversion, ‘a detailed description of the route(s) or network(s) on which,
or, where applicable, the particular areas in which, the vehicle has been used for the
service to which the permit relates for the period of at least 180 days prior to the date of
application…’ (Regulation 5(1)(k) of the regulations promulgated in the North West
Extraordinary Provincial Gazette No 5851, 25 February 2003). Evidently it would militate
against the spirit and purport of the section to grant an applicant rights to operate on a
route on which he or she never operated at least 180 days before the application for
conversion. I am of the view that the provisions of s 80(1) and (2), which constitute
essential jurisdictional factors for a valid conversion, are peremptory. The Board has no
discretion to condone non-compliance with the section. A failure to comply renders the
granting of the application invalid.

[19] Addressing this peremptory requirement of the NLTTA the court below had found
that it could not be said that members of the fourth respondent did not operate on the
disputed route at least 180 days before the date on which the application for the
conversion of their radius-based permits into route-based operating licence as required
by s 80(1) of the NLTTA. This conclusion was based on the finding by the court below
that members of the fourth respondent were in fact unlawfully prevented from operating
on the disputed route, first by an interdict obtained by the appellants against them and
secondly by violence levelled against them. I do not agree.

[20] Firstly the interdict was directed against stopping members of the fourth
respondent ‘from using the areas of the Mogwase taxi rank marked 1 and 2 on the
attached diagram…’. It is clear that this interdict did not prevent members of the fourth
respondent from operating on the disputed route during the relevant period. This
interdict was issued pending the application for the present review by the appellants of
the decision of the Registrar of Transport to award permits to members of the fourth
respondent to operate on the disputed route.

[21] Secondly, there is no evidence on record to support the finding by the court
below that members of the fourth respondent were prevented from operating on the
disputed route by violence. All that the evidence shows is merely that there were
protracted and acrimonious disputes between members of the two taxi rivals. To the
contrary, counsel for the fourth respondent contended before us that members of the
fourth respondent did not operate on the disputed route because, in an attempt to avoid
ongoing confrontations with members of the appellants, they opted to comply with the
advice given by the Registrar, Department of Transport, North West embodied in a letter
dated 28 May 1999 to submit their applications for the conversion of their radius-based
permits into route-based operating licence for its members to regularise their permits,
instead of insisting on operating this route.

[22] In any event the finding by the court below on this crucial aspect is refuted by the
telling concession made by one Isaia Nke who deposed to an answering affidavit on
behalf of the fourth respondent where he unequivocally conceded that the fifth to
twelfth, fourteenth to twenty fourth as well as the twenty sixth respondents did not
operate on the disputed route for at least 180 days before the applications were made
as required by the NLTTA. To my mind this concession is subversive of the finding by
the court below.

[23] Having found that the respondents did not render a transport service on this
disputed route on a regular basis at least 180 days before the application for the
conversion of their permits into operating licences as required by s 80 of the NLTTA, I
am constrained to find, as I hereby do, that their applications for conversion of the
permits into operating licences for the disputed route were invalid and should not have
been granted.

[24] In the result I make the following order:
1.
The appeal is upheld.
2.
The fourth to twenty fourth respondents and the twenty sixth respondent shall
pay the appellants’ costs, including the costs of two counsel, jointly and severally,
the one paying, the others to be absolved.
3.
The order of the court below is set aside and replaced with the following order:

(a) The appeal is upheld with costs, including the costs of two counsel.

(b) The order of the court below is set aside and replaced with the following:

(iii)
The decision of the second respondent to grant operating licences to the
members of the fourth respondent for the route from Moruleng to
Mogwase and back is reviewed and set aside.
(iv)
The respondents shall pay the costs of the applicants jointly and severally,
the one paying the others to be absolved.

____________
L O Bosielo
Judge of Appeal

APPEARANCES:

For Appellants:

C A Da Silva SC
(with him M S Mangolele)

Instructed by:

A O Ndala Inc., Mmabatho

Matsepes Attorneys, Bloemfontein

For Fourth to Twenty-Seventh Respondents:
J H F Pistor SC
(with him C J Zwiegelaar)

Instructed by:

S M Mookoletsi Attorneys, Mmabatho

NW Phalatsi & Partners, Bloemfontein

THE SUPREME COURT OF APPEAL
OF SOUTH AFRICA

MEDIA SUMMARY – JUDGMENT DELIVERED IN THE SUPREME COURT OF APPEAL

FROM

The Registrar, Supreme Court of Appeal

DATE

23 September 2011

STATUS

Immediate

Please note that the media summary is intended for the benefit of the media and does
not form part of the judgment of the Supreme Court of Appeal.

Moruleng and District Taxi Association v North West Provincial Department of
Transport & 27 others (254/10) [2011] ZASCA 138 (23 September 2011)

The appellants (the Moruleng and District Taxi Association) the fourth respondent (the
Mogwase Taxi Association) are rival taxi associations. They both laid claims to operate on a
disputed taxi route (the Mogwase-Moruleng Taxi route) in the North West Province. Members
of the appellant had operating licences issued by the North West Provincial Operating
Licence Board (the Board) in terms of s 79 of the National Land Transportation Act 22 of 2000
(NLTTA) to operate on this route as they had been operating on the disputed route on a
regular basis for a period of at least 180 days before the application for the conversion of their
old taxi permits to the new operating licences as required by s 80(1) of the NLTTA. The
competing claims by the two rival associations to operate on the disputed route led to many
protracted and acrimonious disputes.

Subsequently members of the fourth respondent applied and were granted new operating
licences to operate on the disputed route by the Board. Aggrieved by this decision, members
of the first appellant took the matter on review to the High Court Mmabatho. The high court
(Landman J) dismissed the application, not on the merits, but on a point in limine that it had
been brought after some unreasonable delay or at least not within 180 days after the
appellants had become aware of the decision of the Board as required by s 7 of the
Promotion of Administrative Justice Act 3 of 2000 (PAJA). On appeal the High Court,
Mmabatho (Hendricks J, Leeuw AJP and Kgoele AJ) dismissed the appeal.

Essentially they held that the operating licences issued to members of the fourth respondent
were properly issued and thus valid.

The Supreme Court of Appeal (SCA) held that the court below was wrong in finding that
members of the fourth respondent (Mogwase Taxi Association) had complied with the
jurisdictional requirement set out in s 80(1) of the NLTTA ie that they had been providing a
regular service on the disputed route for at least180 days before the date on which they made
their applications for the conversion of their taxi permits into operating licences. The SCA
found that members of the fourth respondent had not been operating on the disputed route at
least 180 days before the date of their applications for conversion. Having found that this
jurisdictional requirement had not been met, the SCA upheld the appeal, reviewed and set the
decision of the second respondent (North West Provincial Operating Licence Board) to grant
the operating licences aside with costs.