Bertie Van Zyl (Pty) Limited t/a ZZ2 and Others v Minister of Agriculture, Forestry and Fisheries and Others

The appellants (fruit growers, tomato producers, onion growers, and fresh produce importers) challenged the power of assignees under the Agricultural Product Standards Act 119 of 1990 to unilaterally determine their own inspection fees without oversight. The Act permits the Minister to designate "assignees" (persons with knowledge of particular products) to conduct inspections to ensure agricultural products meet prescribed standards. Under s 3(1A)(b)(ii), assignees could determine their own fees for these inspections. The second respondent, Product Control for Agriculture (Procon), had been designated as an assignee and published inspection fees in January 2017. The appellants brought an application in the High Court challenging the constitutionality of s 3(1A)(b)(ii) and seeking to review Procon's fee determination. The High Court dismissed both the constitutional challenge and the review application.

• Whether s 3(1A)(b)(ii) of the Agricultural Product Standards Act, which allows assignees to determine their own inspection fees, constitutes an unconstitutional deprivation of property under s 25 of the Constitution
• Whether s 3(1A)(b)(ii) violates the rule of law and s 195(1) of the Constitution (basic values and principles governing public administration)
• Whether the appellants were required to exhaust their internal remedy under s 10 of the Act before seeking judicial review
• Whether Procon's determination of inspection fees was procedurally fair
• Whether Procon's fee determination was irrational and therefore subject to review

The appeal was upheld in part. The High Court's order was set aside and replaced with: (1) Dismissal of the constitutional challenge to s 3(1A)(b)(ii) read with s 3A(4); (2) Review and setting aside of Procon's determination of inspection fees published as Notice 1 of 2017 in Government Gazette 40537 dated 6 January 2017; (3) Costs of the review to be paid by the first, second and eighth respondents, including costs of two counsel where employed. No costs were awarded on the constitutional challenge, applying the Biowatch principle.

The binding legal principles are: (1) A deprivation of property under s 25 of the Constitution requires an interference with property rights that is substantial and has legally significant impact - paying a fee for a service rendered does not constitute such deprivation, even if the fee is considered excessive. (2) Section 1(c) (rule of law) and s 195(1) (principles of public administration) express constitutional values but do not create enforceable rights that permit courts to invalidate legislation. (3) Where the availability of an internal remedy is ambiguous and not clearly prescribed, courts should exercise discretion under s 7(2) of PAJA to permit reviews to proceed in the interests of justice. (4) Procedural fairness in notice and comment procedures requires that administrators provide sufficient information about the basis and methodology of proposed administrative action (such as fee determinations) to enable affected persons to make meaningful and informed comments. (5) The power to determine fees for public services must be exercised rationally - the fee structure must have a discernible and cognisable connection to the costs of providing the service competently and efficiently. (6) The Biowatch principle applies to constitutional challenges brought by parties with commercial interests - unsuccessful litigants seeking to vindicate constitutional rights should not ordinarily be ordered to pay costs.

Unterhalter AJA made several non-binding observations: (1) There are limits to the utility of semantic contestation by recourse to dictionaries when interpreting statutory language. (2) The scheme of the Agricultural Product Standards Act does not use concepts consistently - various actions resulting from exercise of powers are described differently (classifications, inspections, cancellations, directions), creating uncertainty about the scope of "decisions" appealable under s 10. (3) If s 10 appeals only cover decisions in the narrow sense of determinations of disputes, the provision would have very narrow remit and lack utility. (4) Parties like Procon and Meatco opposing constitutional challenges "must decide whether to oppose a constitutional challenge in the knowledge that their successful opposition carries a cost, and the determination of the constitutional question is a public good that promotes our constitutional order." (5) "The vindication of a constitutional right may be commercially advantageous, but that does not detract from the importance that generally attaches to the freedom with which these rights may be litigated." (6) The purpose of the power to determine inspection fees is to secure compensation sufficient to meet the assignee's costs of carrying out its public duties in a competent and efficient manner.

This case is significant for several reasons: (1) It clarifies the limits of s 25 property rights protection - not every increased financial obligation constitutes a deprivation of property; paying for a service, even if regulated, does not amount to deprivation. (2) It confirms that constitutional values in s 1(c) (rule of law) and s 195 (principles of public administration) do not themselves create enforceable rights that can invalidate legislation. (3) It provides important guidance on procedural fairness in administrative fee-setting - administrators must provide sufficient information about the basis and methodology of proposed fees to enable meaningful public comment. (4) It applies rationality review to administrative fee determinations - fees must be rationally related to the purpose of the power (recovering costs of providing services competently and efficiently). (5) It confirms that the Biowatch principle applies to constitutional challenges even when brought by commercially motivated parties - litigants vindicating constitutional rights should not be deterred by adverse costs orders. (6) It demonstrates judicial willingness to permit reviews to proceed despite failure to exhaust internal remedies where the availability of such remedies is unclear or ambiguous.