Kasselman and Others v The South African National Road Agency SOC Ltd and Others

The appellants, acting through a trust, sought permission from SANRAL to construct and operate a filling station and rest facility alongside the N12 national road. Negotiations commenced in 2016 under a SANRAL policy that levied 0.5% on petroleum sales and 1% on other sales. After all requirements were met and a draft agreement was issued in January 2021, SANRAL introduced substantially increased levies (2.5% and 6%) based on a newly adopted 2021 policy aligned with its Horizon 2030 strategy. The policy was applied retrospectively to the appellants’ pending agreement. The appellants contended that the policy was adopted without proper publication, gazetting, or public participation as required by the SANRAL Act, and that the increased levies rendered the project commercially unviable. They sought judicial review of SANRAL’s decision. The High Court dismissed the review, holding that SANRAL acted as a contracting party. The appellants appealed to the Supreme Court of Appeal.

The appeal was upheld. The High Court order was set aside and substituted with an order reviewing and setting aside SANRAL’s decision to increase the levy percentages; declaring the 2021 policy unlawful and of no force and effect; remitting the matter to SANRAL for reconsideration in compliance with the SANRAL Act; and ordering SANRAL to pay the appellants’ costs, including the costs of two counsel.

This judgment affirms that decisions of state-owned enterprises, even when taken in a commercial context, are subject to public-law scrutiny where they involve the exercise of statutory public power. It reinforces the applicability of PAJA and the principle of legality to SOEs such as SANRAL, clarifies the distinction between contractual powers and public powers, and underscores the constitutional accountability of SOE boards in matters affecting the public and regulated industries.