OWNERSHIP OF AND CUSTODIANSHIP OVER UNSEVERED MINERALS THE IMPACT OF THE MPRDA

by

David William Watson (WTSDAV004)

Submitted to The University Of Cape Town

in fulfilment of the requirements for the degree LLB

Faculty of Law, University of Cape Town

Date of submission: 25 September 2009

Supervisor: Professor Hanri Mostert

Department of Private Law, University of Cape Town

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Declaration 1. I know that plagiarism is wrong. Plagiarism is to use another’s work and pretend

that it is one’s own.

2. I have used the footnoting convention for citation and referencing. Each contribution

to, and quotation in, this opinion from the work(s) of other people has been

attributed, and has been cited and referenced.

3. This opinion is my own work.

4. I have not allowed, and will not allow, anyone to copy my work with the intention of

passing it off as his or her own work.

Signature ______________________________

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Ownership of and Custodianship over Unsevered Minerals The Impact of the MPRDA

by David William Watson (WTSDAV004) Word Count: 9578 This paper was written under the auspices of the LandLawWatch project. The views and opinions expressed here are the author's own and should not be attributed to the LandLawWatch project or the University of Cape Town.

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Abstract This paper examines the various positions authors have taken pertaining to the impact of the MPRDA on the ownership of and custodianship over unsevered minerals in South Africa. It shows how the interpretation provision of the MPRDA does not resolve which position should be preferred. It outlines and considers the landowner position, the state ownership position, the three permutations of that position namely the res

publica, public trust and nationalization positions, and the nation position. None of these positions are satisfactory. The paper concludes with the tentative suggestion that the positions would be better placed in a public law paradigm rather than a private law property paradigm.

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Contents 1 Introduction .............................................................................................................................................. 6

1.1 Background and history ...................................................................................................................... 7 1.2 The research question ........................................................................................................................ 8 1.3 An overview of the various positions .................................................................................................. 8

2 Principles of Interpretation and the MPRDA ........................................................................................ 10 3 Interpreting section 3 and 5 of the MPRDA .......................................................................................... 12

3.1 The landowner position .................................................................................................................... 13 3.2 The state ownership position ............................................................................................................ 17

3.2.1 The res publica position ........................................................................................................... 19 3.2.2 The public trust position ........................................................................................................... 23 3.2.3 The nationalisation position ...................................................................................................... 27

3.3 The nation position ........................................................................................................................... 27 4 Conclusion and analysis ....................................................................................................................... 29 Bibliography ................................................................................................................................................... 31

Literature list ................................................................................................................................................ 31 Cases........................................................................................................................................................... 32 Legislation .................................................................................................................................................... 32

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1 Introduction

The Minerals and Petroleum Resources Development Act 28 of 2002 (MPRDA) was intended to usher in a new regulatory and legal system for minerals in South Africa.1 This new regulatory system was intended to transform the minerals sector.2 To achieve this, the MPRDA proposes to make the state the custodian of the nation’s mineral and petroleum resources.3 Scholars are intrigued as to what this entails for the vesting of existing ownership over unsevered minerals.4 They are also intrigued as to what doctrine gives content to this custodianship. Solving this is believed to be an important part of determining the rights and duties the state has over South Africa’s resources. This paper is an attempt to look at the various positions one can take as to the ownership of the nation’s mineral resources and the custodianship introduced by the MPRDA.

This paper begins by discussing the background to the MPRDA. The research question is then formulated. Broadly stated, the question is “what are the consequences of the MPRDA for ownership of and custodianship over unsevered minerals in South Africa?” The various positions are briefly outlined. Before evaluating the positions the paper discusses some issues that have arisen in relation to the MPRDA’s interpretation clause. Each position is then evaluated in turn. The emphasis of the evaluation is to consider how the position can be reconciled with the text of the MPRDA. A secondary consideration is to evaluate the motivation for the position outside of its textual congruence. Each position is found to be lacking. The paper concludes with some remarks around how the lessons from each position can contribute toward developing a more coherent answer to the research question and questions more broadly.

It is important to understand some of the history of mineral law in South Africa before proceeding to discussing the MPRDA. The next section considers the position prior to the enactment of the MPRDA. It notes the general position in the common-law and explores the consequences of the Minerals Act 50 of 1991 (MA) for ownership of unsevered minerals specifically.

1 Van der Walt Constitutional Property Law 378. 2 Van der Walt Constitutional Property Law 378; Badenhorst 2001 Obiter 119. 3 Section 2 MPRDA. 4 See inter alia Badenhorst & Mostert Mineral and Petroleum Law of South Africa 13; Dale et al South African Mineral and Petroleum Law MPRDA-121-MPRDA-122; Badenhorst & Mostert 2007 TSAR 469; Dale Annual Survey 573; Van den Berg 2009 Stell LR 137; Van der Schyff The Constitutionality of the Mineral and Petroleum Resources Development Act 28 of 2002 chapter 7; Van der Schyff 2008 TSAR 757.

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1.1 Background and history

The position prior to the MPRDA was a mixture of the common-law and the MA since the latter had revived common-law rights of surface owners and mineral right holders.5 The common-law distinguished between ownership over land and the mineral rights over land.6 A mineral right could be understood as a limited real right over land that allowed the holder thereof to prospect for minerals and, if possible, extract minerals and dispose of them.7

The exercise of the mineral right (through granting prospecting leases, mineral leases and the like) was subject to extensive regulation.8 This was achieved through a process of authorizations.9

Under the common-law mineral rights and ownership could be severed.10 The owner of the land did not have to be the holder of the mineral rights in that land. The mineral rights holder did not have to own the land. If the same person held both sets of rights, the rights would remain separate.11

Historically mineral rights formed part of property law.12 This meant that mineral rights were conceptualized using property law concepts such as servitudes.13 Property principles were often used to determine the content of ownership over land vis-à-vis the content of a mineral right over land. Particularly the cuis est solum

eius est usque ad caelum et ad inferos14 stipulated that ownership over minerals that were still in the ground (unsevered minerals) remained with the landowner.15 Only upon separation from the land would the holder of the mineral right become the owner of the separated mineral.16 Yet the proprietary nature of mineral rights should not be overstated since mineral rights were still subject to extensive administrative control through authorizations.17 This common-law position will be extensively explored in the remainder of this essay since much will turn on whether the landowner remains the owner of unsevered minerals.

5 Kaplan & Dale A Guide to the Minerals Act 1991 8; Mostert Perspective on Mineral Law (manuscript in publication – copy on file with author) 67-68. 6 Badenhorst 2004 J. Energy Nat. Resources L. 219; Mostert Perspective on Mineral Law (manuscript in publication – copy on file with author) 13. 7 Franklin & Kaplan The Mining and Mineral Laws of South Africa 7; Badenhorst 2004 J. Energy Nat. Resources L. 219; Mostert Perspective on Mineral Law (manuscript in publication – copy on file with author) 1. 8 Mostert Perspective on Mineral Law (manuscript in publication – copy on file with author) 1 & 68. 9 Mostert Perspective on Mineral Law (manuscript in publication – copy on file with author) 1 & 68. 10 Badenhorst et al Silverberg and Schoeman’s The Law of Property at 337 – 338. Mostert Perspective on Mineral Law (manuscript in publication – copy on file with author) 14. 11 Mostert Perspective on Mineral Law (manuscript in publication – copy on file with author) 14. 12 Badenhorst & Mostert Mineral and Petroleum Law of South Africa 1-9. Mostert Perspective on Mineral Law (manuscript in publication – copy on file with author) 8. 13 Mostert Perspective on Mineral Law (manuscript in publication – copy on file with author) 1. 14 Translation: “whoever owns the soil, it is theirs up to heaven and down to hell.” 15 Badenhorst 2004 J. Energy Nat. Resources L. 220. 16 Badenhorst 2004 J. Energy Nat. Resources L. 221. 17 Mostert Perspective on Mineral Law (manuscript in publication – copy on file with author) 1, 68.

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1.2 The research question

The enactment of the MPRDA has thrown the common-law position into doubt. The MPRDA repealed the MA. The MPRDA’s preamble declared that “South Africa’s mineral and petroleum resources belong to the nation and that the State is the custodian thereof.” The objects of the MPRDA listed “[giving] effect to the principles of the State’s custodianship of the nations mineral and petroleum resources.”18 Section 3 declared that “mineral and petroleum resources are the common heritage of all the people of South Africa and the State is the custodian thereof for the benefit of all South Africans.” Reading these and similar provisions, some commentators argue that the common-law ownership of unsevered minerals has been abolished. Other commentators maintain that common-law ownership of unsevered minerals remains part of South African law.

Although some scholars19 have opined that the resolution of this question may be largely academic, other scholars20 are have argued convincingly that it could have potentially revolutionary consequences. In the next subsection21 there is a discussion of each of these various positions and their increasingly dramatic consequences.

The intention of this paper is to explore some of the more prominent of the positions on the ownership of unsevered minerals in South Africa. This will give some indication whether anything remains of the common-law ownership of unsevered minerals. That discussion will lead naturally onto each position’s understanding of the custodianship imposed by section 3 of the MPRDA. Each position will be outlined, briefly justified and then critically evaluated against the MPRDA. Following that, each position’s rationale will be reflected on briefly.

1.3 An overview of the various positions

There are broadly three positions that one could take concerning ownership of unsevered minerals in South Africa. In very brief terms, these positions may be summarised as the “landowner” position22, the “nation” position23 and the “state” position24: The landowner position holds that the landowner remains the owner of unsevered minerals in South Africa.25 The nation position holds that the people of South Africa now own the unsevered minerals.26 The state position holds that ownership of unsevered minerals now vests in the State.27

18 MPRDA s 2(b). 19 Badenhorst & Mostert 2003 Stell LR 383; Badenhorst & Mostert Mineral and Petroleum Law of South Africa 13-4. 20 Van den Berg 2009 Stell LR 137; Van der Schyff 2008 TSAR 758; Badenhorst & Mostert 2003 Stell LR 382. 21 Section 1.3. 22 See section 3.1. 23 See section 3.3. 24 See section 3.2. 25 Dale et al South African Mineral and Petroleum Law MPRDA-122. 26 The literature does not suggest that there are any proponents of this position. It will still be considered since the language of the MPRDA suggests this reading. 27 Badenhorst & Mostert Mineral and Petroleum Law of South Africa 13-5.

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The state ownership can itself be divided into three different positions. The first position can be called the “res

publica” position.28 This holds that the state now owns the minerals in its public capacity under the old Roman Dutch law concept of res publica. The second state position is the public trust position.29 This holds that the state owns the unsevered minerals subject to the public trust doctrine found in American law.30 The third state position is the “nationalization” position.31 This position is the more broad position that the state divests landowners of ownership and vests that ownership in the state. Each of these positions on the ownership of unsevered minerals corresponds to a different conception of state custodianship over South African minerals.

The various positions exist along a spectrum. The landowner position represents the common-law position. The remaining positions each represent increasingly dramatic departures from the common-law. The state ownership position divests ownership from the landowner and vests it in the state. The nationalization position vests ownership in the state but does not couple it with a particular conception of custodianship. The res

publica position entrenches this vesting in the Roman Dutch law category of property called res publica which determines the states rights and responsibilities over that property. The public trust position similarly divests the owner of title but imports a foreign doctrine to determine the content of the state’s custodianship over those minerals. The nation position suggests not only is there a transfer of ownership but that this transfer is to an entity (the nation of South Africa) that to date has not been recognized within South Africa as capable of being vested with rights.

These positions are analysed in more detail below. Much of the analysis of the various positions will depend on their congruence with the actual provisions of the MPRDA. So before proceeding to the positions a general discussion around interpretation of the MPRDA is required.

28 See Badenhost & Mostert 2006 TSAR 469; Van den Berg 2009 Stell LR 137. See section 3.2.1. 29See Van der Schyff The Constitutionality of the Mineral and Petroleum Resources Development Act 28 of 2002 236; Van der Schyff 2008 TSAR 758. See section 3.2.2. 30 See Van der Schyff The Constitutionality of the Mineral and Petroleum Resources Development Act 28 of 2002 236; Van der Schyff 2008 TSAR 758. 31 The literature does not suggest that there are any proponents of this position. Consequently it will be only briefly addressed. See section 3.2.3.

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2 Principles of Interpretation and the MPRDA

Unfortunately the interpretation clause of the MPRDA gives only partial guidance on questions of interpretation. The MPRDA is clear that fidelity to common-law principles is not decisive when interpreting the MPRDA. It also mandates distinguishing interpretations that are reasonable and consistent with the objects of the MPRDA from those interpretations that are not. However, it does not resolve issues around deciding between various possible interpretations within those two broad categories. This section focuses on these two components of interpretation in the MPRDA.

The interpretation clause (section 4) of the MPRDA reads as follows:

“4. (1) When interpreting a provision of this Act, any reasonable interpretation which is consistent with the objects of this Act must be preferred over any other interpretation which is inconsistent with such objects.

(2) In so far as the common-law is inconsistent with this Act, this Act prevails.”

It could be argued that the more the MPRDA has departed from the common-law, the more express the evidence should be of this departure. For instance, there should be express textual support for a dramatic change or case law that strongly suggests such a conclusion. This would be consistent with the common-law presumption that a statute is intended to change the common-law as little as possible.32 Dale et al propose such a reading of the interpretation clause.33

Dale et al’s analysis should not be followed. Section 4 of the MPRDA expressly stipulates that any reasonable interpretation of a provision that is consistent with the objects of the MPRDA is to be preferred over any other interpretation that is inconsistent with such objects. This statutory stipulation would overrule a presumption that a statute is intended to change the common-law only when necessary. Badenhorst and Mostert follow such a reading of the interpretation clause.34 However there may be certain conditions under which the presumption of least harm to the common-law still applies. This possibility is explored below.

A literal reading of the interpretation clause would suggest that various interpretations are to be ranked into at least two categories; those interpretations that are reasonable and consistent with the MPRDA’s objects and those interpretations that are not. The former category of interpretations is to be preferred. Beyond this, the MPRDA’s interpretation clause does not stipulate how interpretations are to be ranked within those two broad categories and more importantly, within the category of preferred interpretations. If the presumption of least

32 Casserly v Stubbs 1916 TPD 310 at 313; Dhanabakium v Subramanian 1943 AD 160 at 167. 33 Dale et al South African Mineral and Petroleum Law MPRDA-133. 34 Badenhorst & Mostert Mineral and Petroleum Law of South Africa 13-2 & 13-3.

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harm to the common-law remains, then it may be relevant in ranking interpretations within those two broad categories.

This literal interpretation can potentially lead to absurd results. Logical consistency would suggest that an interpretation is consistent with the MPRDA’s objects if it does not defeat or contradict one of the objects. If we assume that the objects of the MPRDA are consistent, then there are no problems. If any of the objects of the MPRDA are inconsistent with each other, then there is scope for absurdity. Imagine that two objects (O1 and O2) are inconsistent. O3 is consistent with both other objects. If one interpretation (I1) of a provision gives effect to O1 then it will be inconsistent with O2. So I1 would fall into the second category of interpretations, that of inconsistent interpretations. If an interpretation (I2) gives effect to O3 it will not be inconsistent with the set of objects. It would thus fall into the first category of interpretations, consistent interpretations. On the literal reading of the interpretation clause, I2 is to be preferred over I1.

Further imagine an interpretation (I3) that gives effect to none of the objects of the act, but it does not contradict any of the act’s objects. I3 would fall into the category of consistent interpretations. It would thus also be preferred over I1. Assume that within the categories of interpretations those interpretations that give effect to the objects of the act are to be preferred to those that do not. This would mean that I2 would be preferred to I3.

If we consider ranking I1, I2 and I3 we would get the following result. I2 is to be preferred to I3 which is to be preferred to I1. This leads to the potentially absurd result that interpretations that give effect only to non-conflicting objects are to be preferred over interpretations that do not conflict with or give effect to any of the act’s objects. These neutral interpretations in turn are preferred over interpretations that give effect to a conflicting object.

This situation is possible within the MPRDA. There is certainly the possibility for conflicts between the objects of environmental protection and economic development,35 or conflict between security of tenure and promoting meaningful opportunities for historically disadvantaged persons.36 If the above reasoning holds, then any interpretation trying to give effect to one of the objects would conflict with another object. Hence it would be ranked below any other interpretations that either do not promote any of the MPRDA’s objects or promote the objects that do not conflict with any other objects. Yet interpretations that give effect to these conflicting objects are probably the very interpretations that will be expected from judges.

35 See for examples of these tensions: Glazewski Environmental Law in South Africa chapter 15. 36 See for examples of these tensions: Legal Resources Centre – Comments on the Mineral and Petroleum Resources Development Amendment Bill, B10-2007 ‘Mining on Community Land: rights of communities’ 24 May 2007.

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This potential absurdity can be avoided by construing the interpretation clause in a different manner. This would be to read that any reasonable interpretation that gives effect to an object of the Act will still fall into the preferred category of interpretations despite conflicting with other objects of the Act. This would not be in accordance with the strict wording of the interpretation clause. However, it would achieve the more desirable result that all interpretations that give effect to some of the objects of the Act fall into the preferred category. It still leaves neutral interpretations (those that do not give effect to an object of the Act) in the preferred category.

So, the MPRDA interpretation clause does not give clear guidance in resolving questions of interpretation. However, those indications that it does give us will still be useful in the next section. Each of the positions that this paper will explore proposes its own manner of interpreting the MPRDA. These various interpretations can be distinguished in part by the interpretation clause.

3 Interpreting section 3 and 5 of the MPRDA

Section 3 of the MPRDA states that:

“3. (1) Mineral and petroleum resources are the common heritage of all the people of South Africa and the State is the custodian thereof for the benefit of all South Africans.

(2) As the custodian of the nation’s mineral and petroleum resources, the State, acting through the Minister, may—

(a) grant, issue, refuse, control, administer and manage any reconnaissance permission, prospecting right, permission to remove, mining right, mining permit, retention permit, technical co-operation permit, reconnaissance permit, exploration right and production right; and

(b) in consultation with the Minister of Finance, determine and levy, any fee or consideration payable in terms of any relevant Act of Parliament.

(3) The Minister must ensure the sustainable development of South Africa’s mineral and petroleum resources within a framework of national environmental policy, norms and standards while promoting economic and social development.”

Section 5 of the MPRDA reads:

“5. (1) A prospecting right, mining right, exploration right or production right granted in terms of this Act is a limited real right in respect of the mineral or petroleum and the land to which such right relates.”

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Section 3 of the MPRDA serves as the foundation from which the various positions construct their cases. Section 5 is also believed to be important in determining the questions this paper explores. Use of phrases in section 3 like “the nation’s mineral and petroleum resources” seems to indicate the possibility of a change of ownership of minerals. The attribution of custodianship in section 3(1) coupled with the extensive powers in section 3(2) and duties in section 3(3) also indicate potentially large changes for the mineral system in South Africa. There is already case law considering the impact of section 3.37 In the Agri South Africa v The Minister

of Minerals and Energy (Agri SA) case the court mentioned the section’s application to the question of expropriation.38 In the De Beers Consolidated Mines Ltd v Ataqua Mining (Pty) Ltd (Ataqua) case the court discussed the impact of section 3 for the ownership of tailings.39 Section 5 is of interest because of its reference to a real right in respect of both the mineral and the land.

This section will explore each of the various positions that authors have proposed in light of section 3 and the MPRDA. The section is structured to explore the landowner’s position as a discrete and independent position. The res publica, public trust and nationalization positions all require as their starting points divesting of ownership from the landowner. Consequently the case for this divesting will be outlined before each of the permutations of the state position is considered. The res publica case for vesting ownership in the state in its public capacity will be considered. Then the public trust case for vesting ownership in the state subject to the public trust doctrine will be considered. There is some discussion of the considerations that may favour selecting the res publica position over the public trust position. Following that the nationalization position will be dealt with quite summarily since it is not seriously proposed by any authors. Finally the nation position will be outlined. As the discussion will indicate none of the positions are without flaws.

3.1 The landowner position

Proponents of the landowner position argue that that MPRDA does not affect a change in the cuius est solum rule.40 Consequently ownership of unsevered minerals would remain in the landowner. The argument against abrogation of the cuis est solum rule proceeds as follows: The MPRDA does not contain any provisions expressly vesting ownership of unsevered minerals.41 Early drafts of the MPRDA did not vest ownership of minerals in situ in the State or any other party.42 This omission suggests that there has been no divesting of

37 De Beers Consolidated Mines Ltd v Ataqua Mining (Pty) Ltd OPD 13-12-2007 case no 3215/06 [38] & [67]; Agri South Africa v The Minister of Minerals and Energy N&S Gauteng 06-04-2009 case no 55896/2007, 10235/2008. 38 Agri South Africa v The Minister of Minerals and Energy N&S Gauteng 06-04-2009 case no 55896/2007, 10235/2008 [10]. 39 De Beers Consolidated Mines Ltd v Ataqua Mining (Pty) Ltd OPD 13-12-2007 case no 3215/06 [38]. 40 Dale et al South African Mineral and Petroleum Law MPRDA-121. 41 Dale South African Mineral and Petroleum Law MPRDA-121. Dale 2002 Annual Survey 574. 42 Dale et al South African Mineral and Petroleum Law MPRDA-121. Edition for Cabinet on 26 July 2000 at s 3(2): “The right to prospect, mine and to dispose of any mineral resources vests in the state, as custodian of the nation’s mineral resources”.

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ownership from the landowner. There is no valid reason to depart from the common-law.43 Consequently, the landowner remains vested with ownership of unsevered minerals. However, the owner’s competence to exploit unsevered minerals has been removed.44 The power to exploit unsevered minerals has been vested in the State.45

Proponents of the landowner position argue that leaving ownership of unsevered minerals in the landowner avoids the potential absurdity of making the State the owner of unsevered minerals. The definition of mineral is so broad that if the state were to be owner of unsevered minerals, then ownership of the land would effectively be lost in favour of the owner of the unsevered minerals.46 This is because the definition of minerals includes sand and soil.47

The above argument and interpretation would appear to be at odds with the use of the phrase “the nation’s mineral and petroleum resources”.48 Section 3 requires attribution of meaningful content including meaningful content of the phrase “nation’s mineral and petroleum resources”. The landowner position needs to give that phrase content that does not include giving the state or the nation ownership.

To achieve this, proponents of the landowner position argue that this is a reference to all the mineral and petroleum occurrences collectively.49 So, it does not refer to particular minerals but to the collective wealth of mineral resources.50 It is this collective wealth that “belongs” to the nation.51

Read together, the landowner’s argument can be summarized as follows. There are no grounds upon which to infer that there has been a divestment of ownership over unsevered minerals. To infer such a divestment in favour of vesting in the state would lead to landowners being stripped of their land ownership. The landowner position still ensures that section 3 of the MPRDA is given meaning.

Issue can be taken with the claim that “mineral resources” are to be interpreted as the collective wealth of the country. The claim that the landowner retains ownership but is divested of the competence to exploit those minerals also requires exploration.

43 Dale et al South African Mineral and Petroleum Law MPRDA-121. 44 Dale et al South African Mineral and Petroleum Law MPRDA-121. 45 MPRDA s 3(2). Dale et al South African Mineral and Petroleum Law MPRDA-121. 46 Dale et al South African Mineral and Petroleum Law MPRDA-121. 47 Dale et al South African Mineral and Petroleum Law MPRDA-122. For a contrasting view see Badenhorst 2004 Stell LR 464. 48 Dale et al South African Mineral and Petroleum Law MPRDA-121. 49 Dale et al South African Mineral and Petroleum Law MPRDA-121. 50 Dale et al South African Mineral and Petroleum Law MPRDA-121. 51 Dale et al South African Mineral and Petroleum Law MPRDA-121.

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Great reliance is placed on interpreting “the nation’s mineral and petroleum resources” to refer to the collective wealth of mineral resources rather than individual instances of minerals. This would ensure that meaning is given to the phrase without it affecting a transfer of ownership. Van den Berg has argued that this interpretation falls foul of the same objection raised against the nation position.52 Van den Berg argues that it is not possible for something to belong to an entity (the nation) that is not a legal subject.53 Consequently, an interpretation that suggests the contrary is either suggesting a relatively dramatic addition to the law or not giving legal consequences to the provision of a statute.

This interpretation can also be subjected a second criticism. An analysis of the instances of “mineral resources” in the MPRDA shows that if the collective wealth interpretation is followed, the MPRDA may equivocate between different meanings of “mineral resources”. Sections 1, 2(e) and (h), 3(3), 37(2), 49(1) and 58(1)(a)(ii) refer to development of “mineral resources”. These sections could be referring to development of the collective wealth of mineral resources. Sections 2(a)-(d), 3(1) and (2), 12(a) and 100 also use “mineral resources” and concern equitable access to, exploitation of, custodianship over or sovereignty over mineral resources. These sections could also be read to be referring to the collective wealth of mineral resources. They could as easily be read as referring to all the instances of mineral resources taken as independent things. So, it would seem on these provisions that the landowner position finds space to interpret mineral resources as referring to the collective wealth of mineral resources.

However, the phrase “mineral resources” is also referred to in other sections. Section 1 defines “mining work programme” as a programme to be followed to mine “a mineral resource optimally”.54 “[P]rospecting work programme” is the programme to “establish the occurrence of any mineral resource in the prospecting area”.55 Section 17 prohibits the Minister from granting a prospecting right if it will, inter alia, result in the concentration of “the mineral resources in question under the control of the applicant”. Section 48(2)(a) refers to the Minister having regard to “the sustainable development of mineral resources involved”. Section 50 is headed “Minister may investigate occurrence, nature and extent of mineral resources”. The section concerns the power of the Minister to investigate whether there are minerals in a particular area. Section 53(3) permits the Minister to investigate particular conduct that may threaten “the mining of mineral resources”. All of these sections indicate that “mineral resources” is also used within the MPRDA to refer to particular minerals or types of minerals. This is an indication that “mineral resources” is not only a collective unit but is composed of discrete instances that are capable of individual regulation. Hence, it is entirely plausible that the other references to

52 See section 3.3. 53 Van den Berg 2009 Stell LR 148. 54 MPRDA s 1. 55 MPRDA s 1.

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“mineral resources” should be understood not just to refer to the collective wealth of minerals but to particular instances of mineral resources.

So, the MPRDA does refer to “mineral resources” when it makes reference to particular instances of mineral deposits or types of minerals. Given this, it would seem more consistent to hold that when “mineral resources” is used in section 3 it refers not just to a collective, but to the various instances that make up the collective. In other words, ownership does not just apply to the collective wealth of mineral resources but to the particular instances of mineral resources. This would be more consistent with the use of “mineral resources” throughout the MPRDA.

Van den Berg argues that having the landowner retain ownership does not serve any purpose since there are no benefits to that ownership.56 This raises an important issue. Besides consistency with the cuius est solum rule, it is unclear what principle or policy the landowner position promotes. It may be argued that this position permits landowners to protect their property when a third party is mining illegally on their property. Courts can use the cuius est solum principle to give standing to a landowner to prevent illegal mining of their in situ minerals. It is not clear that this argument can be sustained. As Dale et al argue, landowners can probably protect themselves with a claim for protection from collateral damages from the illegal mining.57 The landowner has only bare ownership of the minerals. So, the landowner cannot establish financial loss caused by the illegal extraction or that the landowner has a right to the minerals when they become movables upon separation.58 Consequently the landowner position would not improve the landowner’s ability to protect himself against unlawful mining.

The landowner position would retain the common law position. Yet it does not appear to fully account for the text that the MPRDA employs. It is also unclear what policy is served in retaining the common law position.

56 Van den Berg 2009 Stell LR 153. 57 Dale et al South African Mineral and Petroleum Law MPRDA-121. 58 Dale at al South African Mineral and Petroleum Law MPRDA-121.

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3.2 The state ownership position

This next section will focus on how proponents of the state position argue that the landowner has been divested of ownership over unsevered minerals. This argument will be subject to critical analysis. After this discussion the various permutations of the state position will be addressed.

Proponents59 of the state position make their case as follows: They begin by establishing that section 3(1) of the MPRDA abrogates the cuius est solum rule. Consequently it is no longer the case that landowner owns the unsevered minerals. They then argue that the MPRDA does not make the state the custodian of mineral resources in South Africa but rather vests mineral rights in the state. This next section will look at these two steps of the argument in turn.

Proponents argue that section 3(1) of the MPRDA abrogates the common-law rule that the landowner is the owner of the minerals beneath the surface.60 The following considerations are all raised as indications that the cuis est solum rule has been abrogated. The MPRDA’s repeated statement that minerals are the common heritage of all the people of South Africa and the State is the custodian of these minerals is an indication that landowners do not own the unsevered minerals anymore. Section 5’s reference to a real right in respect of both the mineral and the land is an indication that there has been a separation of the land and the mineral.61 This confirms the possibility that they can be separately held. It is also supported by the MPRDA’s express intention to change the common-law and the rule that when the common-law and a statute conflict the statute prevails.62

A number of comments can be made on the above argument. It is not evident that s 3(1) does point to the land owner losing ownership of unsevered minerals. Use of clauses in the MPRDA such as “mineral resources belong to the nation” or “mineral resources are the common heritage of the nation” does not necessarily entail that there is ownership vesting in the nation and consequent divesting from the landowner.63 For instance, an inheritance can befall a beneficiary without bestowing ownership on the beneficiary.64 Further, it is necessary to find that these clauses do not bestow ownership on the nation if the absurdity of giving ownership to an

59 For a range of authors that make arguments that rely on the state position in one way or another see: Badenhorst & Mostert Silverberg and Schoeman Law of Property chapter 23; Badenhorst & Mostert Mineral and Petroleum Law of South Africa 13-3; Badenhorst & Mostert 2007 TSAR 469; Badenhorst & Mostert 2003 Stell LR 377; Van den Berg 2009 Stell LR 137; Van der Schyff The Constitutionality of the Minerals and Petroleum Resources Development Act 28 of 2002. 60 Badenhorst & Mostert Mineral and Petroleum Law of South Africa 13-3. 61 Van der Schyff The Constitutionality of the Minerals and Petroleum Resources Development Act 28 of 2002 240. 62 Badenhorst & Mostert Mineral and Petroleum Law of South Africa 13-3. 63 Van der Schyff The Constitutionality of the Minerals and Petroleum Resources Development Act 28 of 2002 241. 64 Van der Schyff The Constitutionality of the Minerals and Petroleum Resources Development Act 28 of 2002 241.

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entity that does not have legal subjectivity is to be avoided. So, the clauses that may suggest divesting from the landowner because of a corresponding vesting in the nation will have to be read down.

The state ownership proponents can make a subtle response to this argument. This argument is suggested by Van der Schyff.65 Once it is accepted that the nation is to benefit in some way from the mineral resources of South Africa, it becomes more plausible to argue that a doctrine has been introduced that permits giving effect to this. If leaving ownership of unsevered minerals in the hands of the landowner hinders benefiting the nation then it should be divested and more appropriately vested.

More analysis is needed to establish that the interpretation clause supports the state ownership interpretation. Proponents of the abrogation of the cuis est solum rule need to show that this interpretation is reasonable.66 Further, they need to show that is consistent with the Act’s objects. The abrogation of the cuis est solum rule does not appear to conflict with any of the Act’s objects. So, it would be given some priority by the interpretation clause. However Badenhorst and Mostert note that if the cuius est solum rule has been abrogated it would amount to a deprivation of property that would need to be tested against the constitutional property provision.67 This suggests that there is at least a prima facie case that that interpretation is not reasonable. This argument can be strengthened by s 39 of the Constitution that states that when interpreting legislation courts must promote the spirit, purport and objects of the Bill of Rights. As Ngcobo J notes in Daniels v Campbell NO “where legislation is capable of more than one plausible construction, the one which brings the legislation within constitutional bounds must be preferred”.68

Proponents of the state position could respond by arguing that there is some valid purpose that is served by abrogating the cuis est solum rule that would allow it to pass a constitutional muster. This purpose varies according to which state ownership position is being proposed (res publica, public trust or nationalization). There has been extensive writing over the question of the Constitutionality of the expropriation and deprivation of rights by the MPRDA.69 It is beyond the scope of this paper to consider these debates. It should be noted that the resolution of those questions will have a bearing on the acceptability of the abolishment of the cuius

est solum rule.

65 Van der Schyff The Constitutionality of the Minerals and Petroleum Resources Development Act 28 of 2002 241. 66 This is arguably what the more specific permutations of the state ownership position are doing when they motivate for the introduction of res publica or the public trust doctrine. So this criticism should be subject to this caveat. 67 Badenhorst & Mostert 2003 Stell LR 382. 68 Daniels v Campbell NO CC 11-04-2004 case no CCT 40/03 [43]. 69 Van der Walt Constitutional Property Law 383-392; Badenhorst & Mostert 2003 Stell LR 377; Badenhorst & Mostert 2004 Stell LR 22-51.

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The reliance the state position proponents place on the rule that when the common-law and statute conflict the latter prevails needs to be approached cautiously. This rule only establishes that it would be permissible for the legislature to abrogate the cuius est solum rule. This does not dictate that interpretations that change the common-law are to be preferred over those that do not change the common-law. For this to hold, separate reasons in favour of interpretations that alter the common-law need to be advanced.

Proponents of the state position may strengthen their argument by linking the abrogation of the cuius est

solum rule to their argument that the mineral rights have now vested in the state. Before they can make such an argument they need to dismiss statutory provisions that ameliorate finding that the minerals have vested in the state. It may be that the use of the word “custodianship” in section 3 is too weak a statement of what the section proposes to do. It does not propose custodianship but actual vesting of ownership.70

It is at this juncture that the state ownership position forks in a number of ways. The less radical view is that the section has made the state the owner of the minerals but this type of ownership is not private but is public. In turn this has two permutations. The first possibility is that the ownership is public because minerals have become res publica. The second possibility is that the section has made the state a public owner because of the introduction of the public trust doctrine. The more radical permutation is that there has been an express nationalization of minerals in South Africa. These permutations will now be discussed.

3.2.1 The res publica position

Before proceeding into the argument for the res publica position it is appropriate to give some background to the notion of res publica. Things (res) in South African law can be divided into a number of categories according to their role in commerce. Things are outside of commerce (res extra commercium) if they cannot be privately owned.71 Things are inside of commerce (res in commercio) if they can be privately owned or subject to limited real rights. Res extra commercium can be further subdivided into res omnium communes72, res

publica73 and res universitatis74. Res publicae are things which belong to the entire community but not in private ownership but rather as state property.75 Res publicae should be held by the state for the benefit of and use by inhabitants.76 Examples of res publicae include the sea and sea shore.77

70 Badenhorst & Mostert Mineral and Petroleum Law of South Africa 13-3. 71 Badenhorst et al Silverberg and Schoeman’s The Law of Property 32. 72 Badenhorst et al Silverberg and Schoeman’s The Law of Property 33. 73 Badenhorst et al Silverberg and Schoeman’s The Law of Property 34. 74 Badenhorst et al Silverberg and Schoeman’s The Law of Property 36. 75 Badenhorst et al Silverberg and Schoeman’s The Law of Property 34, Van der Merwe & Pope “Property” in Wille’s Principles of South African Law 417. 76 Van der Merwe & Pope “Property” in Wille’s Principles of South African Law 417.

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Van den Berg has made a case for minerals being res publica.78 Van den Berg acknowledges that minerals have not historically been recognized as res publica.79 However, this does not preclude the creation of new forms of res publica.80 Van den Berg argues that the collective mineral resources of South Africa are now res

publica and not unsevered minerals. Van den Berg argues that the collective mineral resources can qualify as a thing.81 Subject to qualifications a thing has the following core characteristics (i) corporeality, (ii) impersonality, (iii) independence, (iv) susceptibility to human control and (v) use and value.82 The collective mineral resources of South Africa satisfy these characteristics.83 Van den Berg argues that the requirement of corporeality can be ignored since incorporeal property has been recognized in some circumstances.84 He argues that the MPRDA has given the collective mineral resources of South Africa incorporeality since the Act talks about the resources as a separate entity.85 This is also an indication that the collective mineral resources should now be categorized as a thing.86 Van den Berg then argues that independence (iii) is easily established since physical independence is not necessary and mere juridical recognition of independence establishes this characteristic.87

Consequently, the collective mineral resources constitute res publicae. Having made the case for the collective minerals being res publica Van den Berg then endorses the reasoning outlined above88 as to why the landowner position cannot be sustained.89 He argues that, read as a whole, the MPRDA removed all the rights a landowner had under the common-law over unsevered minerals.90 There is also no provision expressly leaving ownership of unsevered minerals with the landowner.91

A number of comments are appropriate. This next section will firstly look at whether Van den Berg’s rejection of res publica for minerals in situ in favour of res publica for collective minerals is actually appropriate. It will highlight how an issue with the landowner position raised above92 applies equally to Van den Berg’s claim that the MPRDA introduces the concept of collective mineral resources. The concerns around whether the res

77 Van der Merwe & Pope “Property” in Wille’s Principles of South African Law 417, Van den Berg 2009 Stell LR 149. 78 Van den Berg 2009 Stell LR 148 – 152. 79 Van den Berg 2009 Stell LR 149. 80 Van den Berg 2009 Stell LR 149, Badenhorst & Mostert 2007 TSAR 477. 81 Van den Berg 2009 Stell LR 150. 82 Van den Berg 2009 Stell LR 150 – 151. 83 Van den Berg 2009 Stell LR 151. 84 Van den Berg 2009 Stell LR 151, Van der Merwe & Pope “Property” in Wille’s Principles of South African Law 412, Badenhorst et al Silverberg and Schoeman’s The Law of Property 23. 85 Van den Berg 2009 Stell LR 151. 86 Van den Berg 2009 Stell LR 151. 87 Van den Berg 2009 Stell LR 151. 88 Section 3.1 and 3.2. 89 Van den Berg 2009 Stell LR 153. 90 Van den Berg 2009 Stell LR 153. 91 Van den Berg 2009 Stell LR 153. 92 Section 3.1.

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publica doctrine is the appropriate doctrine will not be dealt with here. Those issues apply similarly to the public trust position and will be addressed after the public trust position has been explained.93

Van den Berg’s decision to argue that res publica applies to the collective minerals and not to minerals in situ seems to be in response to two issues. The first issue is the lack of independence of minerals in situ.94 For something to be a thing independence is required.95 The second is the desire to give good grounds for rejecting Ataqua’s finding that minerals in situ are not res publica.96 This case stated that minerals are not res

publicae.97 Yet neither of these grounds seems compelling for the purposes of making res publica apply to the collective minerals and not minerals in situ.

The argument that minerals in situ lack independence holds equally to the collective minerals of South Africa. Both things are still attached to land. Van den Berg’s argument that independence of collective minerals is created by juridical recognition of independence also applies to unsevered minerals. So, on the grounds of independence there seems to be very little reason to distinguish between unsevered minerals and collective minerals.

There may be grounds to prefer recognition of res publica for unsevered minerals on the basis of the characteristics of things. Recognition of collective minerals as a thing would require exception being made to the characteristic of corporeality. Since unsevered minerals are clearly corporeal there seems to be a slightly more dogmatic ground for arguing that unsevered minerals are res publica with out the need to create an incorporeal thing.

Van den Berg also seems keen to argue against Ataqua. Yet it is not clear that he needs to spend much time rejecting the finding that minerals are not res publica. The part of the judgment that Van den Berg is rejecting reads: “These provisions do not mean that minerals are res publica.”98 Yet, in the context of the judgment it is not clear whether the judges are surveying the submissions of parties or making findings about those submissions. The heading of that section of the judgment reads “Applicant’s submissions”99 and the section does not read like consideration and analysis of the arguments but rather simply stating the applicant’s submissions. Even if those comments were the judges’ opinion then they would only be obiter. The judgment

93 Section 3.2.2. 94 Van den Berg 2009 Stell LR 149. 95 Van den Berg 2009 Stell LR 149. Badenhorst et al Silverberg and Schoeman’s The Law of Property 28 – 29. 96 Van den Berg 2009 Stell LR 149-150. 97 De Beers Consolidated Mines Ltd v Ataqua Mining (Pty) Ltd [38]. 98 De Beers Consolidated Mines Ltd v Ataqua Mining (Pty) Ltd OPD 13-12-2007 case no 3215/06 [38]. 99 [36]

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hinges on a finding that the applicant’s tailing dumps were not subject to the MPRDA.100 If this finding is true, then any statements as to whether the MPRDA has made minerals res publica will be obiter.

So, it would seem that the two reasons raised by Van den Berg for rejecting res publica for unsevered minerals are not convincing. There may even be dogmatic grounds for preferring to attribute res publica to unsevered minerals. Further, the policy reasons that Van den Berg raises for proposing the res publica construction seem more compatible with unsevered minerals than with the collective minerals of South Africa. Van den Berg claims that if res publica has been introduced it will allow better regulation and protection of the collective minerals.101 In particular, it will give the state the remedies available to an owner to vindicate unlawfully mined minerals or claim compensation.102 Yet, claims of this sort are not vindicating or compensating for loss of the collective minerals of South Africa. These would be claims for particular minerals or their value. Intuitively it would appear that the state had a claim over the particular unsevered minerals that were unlawfully mined rather than an abstract incorporeal that has been interfered with in some way. So, there seems to be better fit between the policy objectives that Van den Berg proposes to achieve and making unsevered minerals res publica than with making the collective minerals res publica.

Let us assume that Van den Berg was correct in arguing that res publica should apply to the collective minerals rather than to unsevered minerals. It still remains to be analyzed whether the interpretation coheres with the MPRDA. Van den Berg mentions in passing that the MPRDA refers to mineral resources as a collective and that this is an indication that the MPRDA has made the collective mineral resources an incorporeal thing.103 Yet an argument of this sort does not appear to be sound. As argued above, the MPRDA appears to use “mineral resources” in contexts that can be read to refer not just to mineral resources as a whole but to particular mineral resources in situ.104 So, the textual support for his argument that it has made the collective minerals of South Africa an incorporeal thing cannot be sustained.

So, there are some areas of Van den Berg’s argument that require more extensive analysis. However, it may be that the policy reasons for introducing res publica are compelling and are thus sufficient to introduce it. The policy reasons for accepting the res publica doctrine are similar to policy reasons for accepting the public trust doctrine. Consequently these policy reasons will be discussed after the public trust doctrine.

100 [68]. 101 Van den Berg 2009 Stell LR 150. 102 Van den Berg 2009 Stell LR 150. 103 Van den Berg 2009 Stell LR 151. 104 See section 3.1 where this argument is extensively canvassed.

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3.2.2 The public trust position

Before going into the case that the MPRDA has introduced a public trust doctrine, some introductory remarks are necessary. It is beyond the scope of this paper to go into an in depth discussion of the public trust doctrine. The emphasis here will be on Elmarie Van der Schyff’s argument that the public trust doctrine has been introduced by section 3 of the MPRDA.

This doctrine is predominantly found in American jurisprudence.105 The public trust doctrine denotes the creation of a fiduciary relationship between the state and its citizens.106 The fiduciary duty is the responsibility on the state to hold and manage resources for the benefit of the public.107 To achieve this, the state is given public title over the resource.108 Van der schyff highlights, inter alia, the following features of this public title. The state ownership is held exclusively for the benefit of the public.109 The public benefit is preserving public access to the resource and conserving the resources for public use.110

Van der Schyff argues that the MPRDA has introduced the public trust doctrine over minerals in South Africa. The preamble acknowledges that South Africa’s resources “belong to the nation and that the State is the

custodian thereof [her emphasis]”. This sentiment is repeated in section 2 where the State’s sovereignty over mineral resources is emphasized. Section 3 then expressly states that “mineral and petroleum resources are the common heritage of all the people of South Africa and the State is the Custodian thereof for the benefit of all South Africans [her emphasis]”. Words such as these suggest the introduction of a doctrine that will give effect to this custodianship. Van der Schuff argues that the language of section 5 suggests that minerals and land are separate legal objects. Consequently minerals and land are capable of separate ownership.111 So, section 5 has effected a fundamental change and made minerals capable of separate ownership. Giving effect to the state’s fiduciary duty requires that ownership of unsevered minerals now vests in the state.112 This is confirmed by how the MPRDA regulates royalties.113 After old order rights expire, royalties will be paid to the state.114 So the state and not the landowner will be compensated for the depletion of the minerals.115

105 Van der Schyff The Constitutionality of the Mineral and Petroleum Resources Development Act 28 of 2002 chapter 4. 106 Van der Schyff The Constitutionality of the Mineral and Petroleum Resources Development Act 28 of 2002 106. 107 Van der Schyff The Constitutionality of the Mineral and Petroleum Resources Development Act 28 of 2002 107. 108 Van der Schyff The Constitutionality of the Mineral and Petroleum Resources Development Act 28 of 2002 108. 109 Van der Schyff The Constitutionality of the Mineral and Petroleum Resources Development Act 28 of 2002 148. 110 Van der Schyff The Constitutionality of the Mineral and Petroleum Resources Development Act 28 of 2002 148 - 149. 111 Van der Schyff The Constitutionality of the Mineral and Petroleum Resources Development Act 28 of 2002 240. 112 Van der Schyff The Constitutionality of the Mineral and Petroleum Resources Development Act 28 of 2002 242. 113 Van der Schyff The Constitutionality of the Mineral and Petroleum Resources Development Act 28 of 2002 242. 114 Van der Schyff The Constitutionality of the Mineral and Petroleum Resources Development Act 28 of 2002 239. 115 Van der Schyff The Constitutionality of the Mineral and Petroleum Resources Development Act 28 of 2002 242.

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Van der Schyff argues that the overall context of the act overcomes concerns that “custodianship” over mineral resources is used rather than “ownership.116 The use of the word “custodianship” emphasizes the fiduciary duty of the state.117

The provisions relied upon by the res publica proponents and the public trust advocates are almost all the same. Consequently Van der Schyff’s analysis can be criticized for reasons that are very similar to the criticisms of the res publica doctrine.

However, there are ways to distinguish between res publica and the foreign public trust doctrine. Van den Berg argues that both concepts serve the same purpose and have similar consequences.118 The only material difference is that res publica is indisputably part of South African law while the public trust doctrine is relatively unknown in South African law.119 So the wisdom of introducing a foreign doctrine into South African law needs to be considered. If the public trust doctrine is going to guide either the judiciary or the state in regulating minerals it needs more definitive content. As Van der Schyff notes, the public trust doctrine has a multitude of manifestations in the various states in the United States of America.120 Consequently, South African courts are not faced with a doctrine that has clearly defined boundaries and content. This could potentially result in expensive litigation over which aspects of the public trust doctrine have been incorporated into South African law.121 This uncertainty and the costs of creating clarity make a strong case against South Africa following the American public trust doctrine. If such anything, such litigation should rather be around crafting uniquely South African tools to regulate public resources. On a more jurisprudential level it would promote coherence and consistency within the law to opt for the res publica approach.

There are some general concerns with the policy motivations behind introducing either res publica or the public trust doctrine. The idea behind both is that the custodial role the state is now expected to fulfil needs content and this content is best given by the introduction of the proponent’s doctrine. This entails the imposition of constraints and duties on the state. The res publica and public trust doctrine are also intended to empower the state by giving it the necessary tools to perform its custodial duty.122 In this way the res publica and public trust doctrines can be said to be supplementing the provisions of the MPRDA. Res publica123 and

116 Van der Schyff The Constitutionality of the Mineral and Petroleum Resources Development Act 28 of 2002 243. 117 Van der Schyff The Constitutionality of the Mineral and Petroleum Resources Development Act 28 of 2002 243. 118 Van den Berg 2009 Stell LR 152. 119 Van den Berg 2009 Stell LR 152. 120 Van der Schyff The Constitutionality of the Mineral and Petroleum Resources Development Act 28 of 2002 107. 121 Van den Berg 2009 Stell LR 147. 122 Dale et al South African Mineral and Petroleum Law MPRDA-124. 123 Dale et al South African Mineral and Petroleum Law MPRDA-121.

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the public trust doctrine124 are also intended to give standing to the public to raise environmental and other concerns around the use of the minerals. Each of these policy motivations can be subject to criticism.

Obviously the actual restraints imposed and powers given need to be listed and explored more thoroughly. It is beyond the scope of this paper to go into what each position suggests in this regard. However, there are some criticisms that can be made in the abstract to the principle that the state should be further burdened with obligations or given more powers.

The first criticism of the res publica and public trust doctrine concerns restraining state action. In administrative law it is recognized that the state is best placed to make polycentric decisions.125 It is recognized that the state has the democratic legitimacy, specialist skills and knowledge that the judiciary lacks.126 These concerns apply equally in the context of mineral law. Any doctrine that imposes restraints and duties on the state is limiting the discretion of the state as to how it regulates mineral law. Consequently there are strong separation of power considerations that should stymie any attempts to impose additional burdens and duties on the state.

There are a number of responses to this line of argument. The first is that if the MPRDA has in fact introduced either res publica or the public trust doctrine then there has been no violation of the separation of powers. The legislature has thus introduced the doctrine and the courts should enforce it in line with separation of powers. However, this argument is not compelling. Even if the legislature has introduced a doctrine almost all of its content will still have to be judge-made; judges will determine how the old principles of res publica must be transferred from predominantly water scenarios to minerals or alternatively judges will have to decide which aspects of the public trust doctrine should be incorporated. So the separation of powers concern remains.

It may be argued that the res publica and public trust doctrines are the content of the constitutional right to an environment.127 If this is the case, then the separation of powers concerns are removed. Legislative and executive actions are subject to the Constitution so when courts read in res publica or public trust there is no violation of the separation of powers. Courts acting in this way are giving effect to constitutional supremacy and to the right to an environment.

This argument will not work for two reasons. Firstly, it is not clear that proponents of these positions believe that the Constitution mandates the introduction of either res publica or public trust. The proponents base their

124 Dale et al South African Mineral and Petroleum Law MPRDA-124. 125 Logbro Properties CC v Bedderson NO and Others 2003 (2) SA 460 (SCA) [21]; Bato Star Fishing (Pty) Ltd v Minister of Environmental Affairs and Others 2004 (4) SA 490 (CC) [48]; see generally Hoexter 2000 SALJ 501. 126 Davis 2006 Acta Juridica 26. 127 The Constitution s 24.

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arguments on an interpretation of the provisions of the MPRDA and not directly on Constitutional right. Secondly, there are compelling reasons to keep doctrines rooted as common-law supplements to the MRPDA rather than as Constitutional supplements.

It would not be wise for proponents of res publica and public trust to base their doctrines directly on the Constitution. The doctrine of avoidance means that constitutional rights should not be relied upon directly.128 By giving res publica and the public trust common-law authority and not constitutional authority the following benefits are possible. The legislature can tinker with the content of the doctrines because the doctrines are not entailed by the Constitution. The judiciary is then able to measure res publica and the public trust doctrine against the Constitution and develop the doctrines in line with the section 39 mandate to develop the common-law. Further, since the legislature can, by legislation, vary the content of either res publica or the public trust doctrine and courts can measure these changes against the Constitution for Constitutionality.

The second general criticism of the res publica and public trust doctrine relates not to the imposition of restraints and duties but to the bestowing of powers on the state. There is an old administrative law notion that every state action should be exercised on the basis of an expressly provided for power.129 This stems from the liberal recognition that, given the state’s already extensive powers, adding to these powers should be done cautiously for every power reduces the corresponding freedom of the state’s subjects.130

This argument seems to be at odds with the arguments just presented about how the judiciary should be cautious in imposing restraints on the state. To read the arguments in that way would be to miss the underlying rationale. Clearly the state will need to be bestowed with powers to perform its Constitutional mandate to promote reform of the minerals sector. However, these powers should be created and bestowed by a democratically elected legislature and not the judiciary. If, in implementing the MPRDA it is discovered that the state does not have all the required tools then the legislature is better suited to craft the appropriate tool to fill such a lacuna.

The final rationale for either the public trust or res publica positions is that they give standing to the public. The Constitution has a judiciable right to the environment131 and a right to just administrative action132. These in combination with the very broad locus standi provisions of the Constitution in section 38 mean that the public

128 National Coalition for Gay and Lesbian Equality v Minister of Home Affairs 2000 (2) SA 1 (CC) [21]; Currie & De Waal The Bill of Rights Handbook 25 & 32. 129 Hoexter Administrative Law in South Africa 42. 130 Hoexter Administrative Law in South Africa 57. 131 The Constitution s 24. 132 The Constitution s 33.

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would probably be able to base their standing on the Constitution without the need for the res publica or public trust doctrines.

The preceding section outlined the public trust position. The analysis of the doctrine then focused on what distinguished the public trust doctrine from the res publica doctrine. There seem to be fairly persuasive doctrinal and policy reasons for preferring the res publica position to the public trust doctrine. The policy reasons for accepting either position were then outlined. The reasons in short are that the doctrines will both constrain and empower the state in the performance of its custodial duties. The doctrines will give standing to the public to enforce the states obligation to be the custodian of the minerals in South Africa. None of the reasons were particularly compelling in the abstract. There appears to be a democratic case for avoiding imposing restraints on the state and giving the state further powers. It is also not clear that the public lacks standing in enforcing the state’s custodial obligations because of the broad locus standi provisions of the Constitution.

3.2.3 The nationalisation position

The nationalisation position does not warrant much discussion so it is not defended as such by any authors. Yet, if nationalisation is understood as “the taking of privately held mineral rights, with or without the payment of compensation”133 then it should be apparent that any of the state positions are likely to be a form of nationalisation. Despite this, distinguishing the res publica and public trust positions from nationalisation make their emphasis of the state’s custodial duties apparent.

3.3 The nation position

The nation position is the position that ownership of minerals in South Africa now vests in the people134 of South Africa. There is consensus amongst most of the academic writing that this position is not tenable.135 Before proceeding to arguments against this position it is appropriate to sketch an argument that could be made in its favour.

The objects of the MPRDA refer to “the nation’s mineral and petroleum resources” four times.136 Section 3(1) expressly mentions mineral resources being the common heritage of the people of South Africa. Section 3(2)

133 Badenhorst et al 1994 J. Energy Nat. Resources L. 287. 134 The MPRDA moves interchangeably between referring to ‘the people’ and ‘the nation’. It does not appear that anything turns on whether ‘the people’ or ‘the nation’ is used. 135 Badenhorst & Mostert Mineral and Petroleum Law of South Africa 13-3; Badenhorst & Mosterst 2007 TSAR 477; Dale et al South African Mineral and Petroleum Law MPRDA-121-MPRDA-122; Van der Schyff The Constitutionality of the Mineral and Petroleum Resources Development Act 28 of 2002 241; Van den Berg 2009 Stell LR 150. 136 MPRDA s 2(b), (c), (d) and (h).

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then refers to the state being the “custodian of the nation’s mineral and petroleum resources”. The MPRDA’s preamble acknowledges mineral resources “belong to the nation”. Ownership of unsevered minerals is not expressly vested in the nation but it is strongly suggested by the preamble and the repeated use of “the nation’s mineral and petroleum resources”. The nation position seems to be the most literal interpretation of the MPRDA.

Conferring a right onto a nation or people has some support in international law. Consider article 21(1) and (4) of the African Charter of Human and Peoples’ Rights (the African Charter):

“21. (1) All peoples shall freely dispose of their wealth and natural resources. This right shall be exercised in the exclusive interest of the people. In no case shall a people be deprived of it.

(4) State parties to the present Charter shall individually and collectively exercise the right to free disposal of their wealth and natural resources with a view to strengthening African unity and solidarity.”

Section 21(1) seems to indicate that a collective right is being conferred onto all peoples within the African states that are parties to the Charter. Article 21(4) is an indication that although the right vests in the people of a country, the state is to exercise the right on behalf of the people.

This single instance of bestowing a right on a nation is not sufficient to establish an international or municipal principle giving a nation or people subjectivity. As Dale et al note, a people or nation does not enjoy legal subjectivity in either municipal or international law.137 Thus it does not have the legal personality required to acquire or hold ownership (whether that be public or private ownership).138 So, even if the cuius est solum rule has been abrogated there can be no corresponding vesting of ownership of the minerals in the nation.

Besides conflicting with some fundamental legal personality issues, the nation position cannot entirely claim textual support for its position. There absolutely no mention of ownership of or vesting of unsevered minerals in the MPRDA.139

The nation’s lack of legal personality and corresponding ability to own the minerals means that despite its relatively strong textual support the nation position cannot be sustained.

137 Dale et al South African Mineral and Petroleum Law MPRDA-4. 138 Dale et al South African Mineral and Petroleum Law MPRDA-4. 139 Dale 2002 Annual Survey 574.

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4 Conclusion and analysis

It would aid the final analysis to give a brief thematic summary of the various strengths and weakness of the positions that are supported by various authors. The nationalization position and the nation position warrant no further discussion since they are not seriously proposed by any authors.

The interpretation clause gave only very limited guidance as to how questions of interpretation were to be resolved. At best it suggested ranking reasonable interpretations that do not conflict with the objects of the MPRDA to other interpretations. Yet none of the serious positions that were surveyed could be disqualified by this ranking mechanism.

All of the positions had some textual support in their favour. However, when the MPRDA was taken as a whole the textual support was, at best, equivocal for any of the positions. Consequently the text is indeterminate between the various alternatives. This indeterminacy is not likely to be resolved by further hermeneutic analysis of the MPRDA. This is not an issue. The textual analysis is important since it highlights the need to account for phrases like “the nation’s mineral and petroleum resources” and “custodianship”. The indeterminacy of such phrases suggested that consideration of the policy motivations behind each position should be considered.

The policy motivations behind each position were open to criticism. The landowner position did not seem to have a compelling reason for the landowner retaining ownership of unsevered minerals. The landowner could already protect himself from unlawful mining with other private law remedies. The res publica and public trust positions both gave content to the state’s new custodial role in the MPRDA. However, the separation of powers suggests that judicial doctrines should not supplement the MPRDA and further restrain or empower the state. There are adequate means by which the public can protect its rights in minerals through the Constitution’s broad locus standi provisions. Consequently the policy reasons surveyed for each position were not compelling.

However, the criticisms of the res publica and public trust positions suggest that there may be another policy reason for supporting the landowner position. The landowner position does not supplement the custodianship of the MPRDA. The MPRDA already extensively empowers the state, through the Minister, to regulate minerals in South Africa. The MPRDA also limits the state by, for example, making the Promotion of Administrative Justice Act 3 of 2000 apply.140 Provisions of this nature give content to the custodial duty of the

140 MPRDA s 6.

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state. The more literal landowner position can still give adequate content to custodianship without falling foul of the separation of powers.

It is appropriate to conclude on a note that is somewhat critical of the methodology of this paper’s enquiry. Even if it is established where ownership of unsevered minerals vests it will probably have very little impact in practice since there is such extensive regulation on how minerals are to be extracted.141 At best answering the question will suggest a certain interpretative approach on questions that are more likely to be litigated. Yet this reverses the approach that should be taken. A more coherent and pragmatic jurisprudence would be developed by resolving problems that arise in practice. The general jurisprudence that develops in answering those questions should be used to decide this more abstract question. The scepticism does not apply with equal force to the question of custodianship. Since the custodianship is over all minerals and not just unsevered minerals, giving content to custodianship can aid in answering questions that are likely to be raised in practice. The cautious suggestion of this essay is that the content of custodianship should stem from a public law paradigm that grapples with questions around polycentricity, the separation of powers and Constitutional limitations on the state’s duty to promote mineral reform. The starting point of such an enquiry should be the express provisions of the MPRDA.

141 Badenhorst & Mostert Mineral and Petroleum Law of South Africa 13-4.

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Bibliography

Literature list

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Badenhorst PJ “Mineral Rights: ‘Year Zero’ cometh?” 2001 Obiter 119-141. Badenhorst PJ “Exodus of ‘Mineral Rights’ from South African Mineral Law” 2004 J. Energy Nat. Resources L.

218-235. Badenhorst PJ & Mostert H “Revisiting the transitional arrangements of the Mineral and Petroleum Resources

Development Act 28 of 2002 and the constitutional property clause: An analysis in two parts (Part one)” 2003 Stell LR 377-400.

Badenhorst PJ & Mostert H “Revisiting the transitional arrangements of the Mineral and Petroleum Resources Development Act 28 of 2002 and the constitutional property clause: An analysis in two parts (Part one)” 2003 Stell LR 22-400

Badenhorst PJ “For old time’s sake, meaning of a ‘mineral’: Armstrong v Sehadew Oree t/a Oree's Cartage and Plant Hire 2004 4 SA 152 (SCA)” 2004 Stell LR 464-477.

Badenhorst PJ, Pienaar JM & Mostert H Silverberg and Schoeman’s The Law of Property 5 ed (2006) LexisNexis Butterworths Durban.

Badenhorst PJ & Mostert H Mineral and Petroleum Law of South Africa revision service 3 (2007) Juta Cape Town.

Badenhorst PJ & Mostert H “Artikel 3 (1) en (2) van die Mineral and Petroleum Resources Development Act 28 van 2002: ’n Herbeskouing” 2007 TSAR 469-493.

Currie I & De Waal J The Bill of Rights Handbook 5ed (2005) Juta Cape Town. Dale MO “Mining Law” 2002 Annual Survey 573-504. Dale MO, Bekker L, Bashall FJ, Chaskalson M, Dixon C, Grobler GL, CDA Loxton South African Mineral and

Petroleum Law service 5 (2007) LexisNexis Durban. Davis D “To Defer and then When? Administrative Law and Constitutional Democracy” 2006 Acta Juridica 23-

41. Franklin BLS & Kaplan M The Mining and Mineral Laws of South Africa (1982) Butterworths Durban. Glazewski J Environmental Law in South Africa 2ed (2005) LexisNexis Butterworths Durban. Hoexter C “The Future of Judicial Review in South African Administrative Law” 2000 SALJ 484-519. Hoexter C Administrative Law in South Africa (2007) Juta Cape Town. Kaplan M & Dale MO A guide to the Minerals Act 1991 (1992) Butterworths Durban. Legal Resources Centre – Comments on the Mineral and Petroleum Resources Development Amendment Bill,

B10-2007 ‘Mining on Community Land: rights of communities’ 24 May 2007. Mostert H Perspective on Mineral Law (manuscript in publication – copy on file with author). Van den Berg HM “Ownership of minerals under the new legislative framework for mineral resources” 2009

Stell LR 137-156. Van der Merwe CJ & Pope A “Property” in du Bois F (ed) Wille’s Principles of South African Law 9 ed (2007)

Juta Cape Town 405 - 630. Van der Schyff E “Who ‘owns’ the country’s mineral resources? The possible incorporation of the public trust

doctrine through the Mineral and Petroleum Resources Development Act” 2008 TSAR 757 – 768. Van der Schyff The Constitutionality of the Mineral and Petroleum Resources Development Act 28 of 2002

LLD North West University (2006). Van der Walt AJ Constitutional Property Law (2005) Juta Cape Town.

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Cases

Agri South Africa v The Minister of Minerals and Energy N&S Gauteng 06-04-2009 case no 55896/2007, 10235/2008.

Bato Star Fishing (Pty) Ltd v Minister of Environmental Affairs and Others 2004 (4) SA 490 (CC). Casserly v Stubbs 1916 TPD 310. Daniels v Campbell NO CC 11-04-2004 case no CCT 40/03. Dhanabakium v Subramanian 1943 AD 160. De Beers Consolidated Mines Ltd v Ataqua Mining (Pty) Ltd OPD 13-12-2007 case no 3215/06. National Coalition for Gay and Lesbian Equality v Minister of Home Affairs 2000 (2) SA 1 (CC). Logbro Properties CC v Bedderson NO and Others 2003 (2) SA 460 (SCA).

Legislation

Minerals and Petroleum Resources Development Act 28 of 2002. Minerals Act 50 of 1991.

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