Minister of Police v SA Metal and Machinery Company (Pty) Ltd

On 13 June 2008, members of SAPS seized scrap metal goods (including 142kg of scrap brass water meters, 20kg of mixed copper scrap, 31kg of copper wire, 40kg of scrap lead, and one drain cover) from SA Metal's premises in Epping, Cape Town, pursuant to section 20 of the Criminal Procedure Act 51 of 1977. The goods were seized in connection with suspected stolen property offences. In January 2009, SA Metal's former director, Mr De Klerk, was charged under section 36 of the General Law Amendment Act 62 of 1955 for possession of suspected stolen property, but this charge was withdrawn. In April 2010, the DPP instructed that De Klerk be charged with possession of 48 water meters only. Before SA Metal filed its application for return of the goods in April 2010, SAPS disposed of the goods: the water meters were returned to the City of Cape Town in December 2009, mixed copper scrap to Telkom in November 2009, and the remaining items sold to Rall Scrap Metals in December 2009. SA Metal sought return of the goods or, alternatively, damages under the actio ad exhibendum valued at R8,611.50.

• Whether SAPS was entitled to dispose of the seized goods under section 31(1) of the Criminal Procedure Act 51 of 1977
• On whom the onus rests to prove lawfulness or unlawfulness of possession under section 31(1) of the CPA
• Whether failure to comply with the Second-Hand Goods Act 23 of 1955 rendered SA Metal's possession of the goods unlawful
• Whether SA Metal could claim damages under the actio ad exhibendum by way of motion proceedings
• What are the requirements for succeeding in a claim under the actio ad exhibendum

The appeal was dismissed with costs, including costs of two counsel where so employed. The order of the Western Cape High Court granting SA Metal damages of R8,611.50 under the actio ad exhibendum was confirmed.

The binding legal principles established are: (1) Under section 31(1) of the Criminal Procedure Act 51 of 1977, the onus rests on the State to prove on a balance of probabilities that the person from whom goods were seized may not lawfully possess those goods. (2) Mere failure to comply with regulatory requirements of the Second-Hand Goods Act (such as keeping a register) does not render possession of second-hand goods unlawful for purposes of section 31(1) of the CPA; such non-compliance only creates criminal liability under section 11 of that Act. (3) The State's power to dispose of seized goods under section 31(1) is conditional upon proving that the person from whom they were seized, or any other person, may not lawfully possess them. (4) To succeed in a claim under the actio ad exhibendum, a claimant must prove: (a) ownership of the goods; (b) wrongful alienation before litis contestatio; (c) the defendant's awareness of the claim at the time of alienation; and (d) patrimonial loss.

The court made non-binding observations regarding the appropriateness of motion proceedings for illiquid claims, endorsing and applying the principles from Cadac (Pty) Ltd v Weber-Stephen Products Co 2011 (3) SA 570 (SCA). The court observed that while motion proceedings are generally not suitable for illiquid claims involving factual disputes, there is no objection in principle to a plaintiff seeking a declaratory order on liability in motion proceedings with quantification to follow, particularly where there is no bona fide dispute as to quantum. The court also observed that even after the withdrawal of charges and in the absence of further prosecution, where the DPP has given instructions for a charge but no charge has been preferred and none is reasonably likely in the foreseeable future, the seized property should be returned (subject to lawful possession requirements).

This case is significant in South African criminal procedure law for clarifying the interpretation and application of section 31(1) of the Criminal Procedure Act regarding return of seized goods. It establishes important principles about: (1) the onus of proof in applications for return of seized property - the State bears the burden of proving unlawful possession; (2) the distinction between criminal non-compliance with regulatory legislation (such as the Second-Hand Goods Act) and unlawful possession for purposes of section 31(1); (3) the availability of motion proceedings for actio ad exhibendum claims where liability issues are legal rather than factual and quantum is undisputed; and (4) the elements required to succeed in an actio ad exhibendum claim where goods have been wrongfully disposed of by authorities. The judgment reinforces procedural protections for persons whose property is seized by police and limits the State's power to dispose of seized property.