C W A Snyders N.O. as Trustee of the Louis Snyders Familie Trust v Louistef (Pty) Ltd and Another

The Trust owned immovable property in Brits that had been leased to Louistef (the lessee) since 1991 for operating a motor dealership and fuel filling station. Under the Petroleum Products Amendment Act 58 of 2003 (PPA), the lessee acquired a site licence and retail licence through transitional provisions. The PPA's new dispensation provided that only property owners (or those holding public land with permission) could acquire and hold site licences. The lease was to terminate at the end of April/May 2014. On 26 March 2014, the parties agreed to a sale of the site licence from the lessee to the Trust for R1,000,000, to enable the Trust to obtain the site licence and continue operating the filling station. The site licence was subsequently issued to the Trust. On 26 June 2015, the Trust's new attorneys asserted the sale agreement was invalid and instituted proceedings to have it declared null and void.

• Whether a site licence issued under the Petroleum Products Amendment Act 58 of 2003 constitutes an asset with commercial value capable of being sold
• Whether the regulations under the PPA contained a casus omissus (omitted eventuality) regarding transfer of site licences from lessees to owners
• Whether the sale agreement for the site licence between the Trust and the lessee was valid and enforceable
• Whether the transfer of the site licence involved a deprivation of property raising constitutional concerns
• Whether it was in the interests of justice to grant leave to appeal to the Constitutional Court

The application for leave to appeal was dismissed with costs.

A site licence issued to a lessee under the transitional provisions of the Petroleum Products Amendment Act 58 of 2003 is an asset with commercial value that is capable of being sold. However, this transferability is subject to two constraints: (i) it is transferable only to new lessees or new owners, and (ii) it cannot survive the termination of the lease period. The regulations do not contain a casus omissus regarding transfer of site licences from lessees to owners - the transitional provisions deliberately allowed lessees to transfer site licences to new lessees or new owners during the lease period, consistent with the overall legislative scheme that site licences should ultimately be issued only to property owners. When determining whether to grant leave to appeal, reasonable prospects of success are necessary but not sufficient; the ultimate determinant is the interests of justice.

The Court observed that the Trust appeared to want to 'have its cake and to eat it' - having benefited from the transfer of the site licence and continuing to operate under it, while seeking to avoid paying for it. The Court also noted that the Supreme Court of Appeal, while correct in finding the site licence had commercial value, may have failed to appreciate that it existed only for a limited time and potentially only against new lessees and new owners. The Court commented that the constitutional angle the Trust belatedly sought to attach to the application was without merit, as no deprivation of property was involved in the application of the PPA.

This case clarifies the legal nature of site licences issued under the Petroleum Products Amendment Act 58 of 2003, particularly under the transitional provisions. It establishes that such licences held by lessees constitute assets with commercial value that can be sold, but subject to important constraints - they are transferable only to new lessees or new owners and cannot survive termination of the lease. The judgment demonstrates the proper interpretation of transitional licensing provisions in regulatory schemes and confirms that no constitutional property rights issues arise from the application of such provisions. It also illustrates the Constitutional Court's approach to granting leave to appeal, emphasizing that reasonable prospects of success alone are insufficient - the interests of justice must be considered, taking into account factors such as whether the applicant has obtained the benefit sought and is attempting to avoid corresponding obligations.