On 8 January 2020, the High Court ordered the appellant to pay to the first respondent:
1. The sum of US$877,435 being the outstanding meteorological weather services fees (Met fees) for the period January 2006 to 30 April 2014;
2. All and further outstanding meteorological weather service fees (Met fees) from 1 May 2014 to the date of final payment;
3. Interest on the above sums at the prescribed rate from the date of the service of summons to date of final payment; and
4. Costs of suit on a legal practitioner and client scale.
The appellant appeals against this order.
THE FACTS
The appellant is a South African public company registered in terms of section 4(3) of the South African Airways Act 2007. It operates an international airline service with flights to and from Zimbabwe.
The first respondent is the Minister of Environment, Water and Climate (the Minister). He administers the Meteorological Services Act [Chapter 13:12] and its subsidiary legislation, the Meteorological Services (Aviation Weather Services) Regulations 2005, Statutory Instrument 32/2005.
The second respondent is the Civil Aviation Authority of Zimbabwe (CAAZ). It is a statutory corporation, established on 1 January 1999, in terms of section 4 of the Civil Aviation Act [Chapter 13:16]. At the material time, it managed all the airports and aerodromes in Zimbabwe.
The Meteorological Services Department (MSD) was established in 1925. It is mandated, by legislation, to produce aeronautical weather services in Zimbabwe for the benefit of the general public and private players.
On 2 April 2004, the Meteorological Services Act mandated the Meteorological Services Department (MSD) to charge private players, amongst whom was the aviation industry, for the provision of these services on a cost recovery basis. The modalities for implementing the cost recovery measures were instituted, in consultation and by agreement, with the Airline Operators Committee between 13 June 2004 and 15 September 2004. The resultant tariffs were based on the cost and life span of the equipment used and the cost of providing the service.
These aeronautical weather services were predicated upon the International Civil Aviation Organization (ICAO) and the World Meteorological Organization specifications and guidelines. They were categorized as landing, en-route or over flight, and departure fees. They were to be availed to the aviation industry through the Civil Aviation Authority of Zimbabwe (CAAZ).
The set tariffs were operationalized on 1 May 2005.
On 23 June 2006, the Meteorological Services Department (MSD) concluded an agreement with the Civil Aviation Authority of Zimbabwe (CAAZ). In terms of clause 7.1 of the agreement, CAAZ became the collection agent for the cost recovery fees chargeable to the individual airlines which serviced the local air space.
Thereafter, CAAZ charged individual airlines for its own specified services in terms of the Aviation (Aeronautical Telecommunications and Information Services Regulations 2004; Aviation (Air Traffic Services) Regulations 2010; Aviation (Air Navigation) Regulations 2004; and Aviation (En-route Navigation Facilities) (Fees) Regulations, SI 67/1997.
It combined services supplied by the Meteorological Services Department (MSD) in a composite invoice but under the single and distinct rubric of “Met Fees”.
The appellant, and a few select airlines, paid the specified Civil Aviation Authority of Zimbabwe (CAAZ) fees but declined to pay for the meteorological weather service fees (Met Fees).
The recalcitrant airlines sought the resolution of the impasse through the mediation of IATA and ICAO between 26 July 2006 and 26 July 2010. Notwithstanding the breakdown of the fees by type and cost of each respective service by CAAZ to the mediators, the negotiations failed.
By an act of State, the Meteorological Services Department (MSD) was transferred from the Minister of Transport and Infrastructural Development to the first respondent (the Minister of Environment, Water and Climate) on 7 February 2014.
An adverse audit report by the Auditor-General prompted the Minister of Environment, Water and Climate (the Minister) to issue summons against the appellant on 20 August 2014 seeking the payment of the amounts that form the subject matter of this appeal. The summons was served on 22 August 2014.
The appellant entered its plea on 9 June 2015.
It, inter alia, raised a special plea in bar of prescription (in terms of section 15(c)(ii) of the Prescription Act [Chapter 8:11]) to the claims preceding 22 August 2008.
It admitted, firstly, in paragraphs 2.2-2.4 of its plea, that, the Civil Aviation Authority of Zimbabwe (CAAZ) was a collection agent of the Minister of Environment, Water and Climate (the Minister) at all material times; and, secondly, that, it had indeed received the aeronautical services.
It, however, sought to avoid the claims on the main basis, that, it had discharged all its obligations; and, in the alternative, that, if it was found liable, then, it should be reimbursed the putative judgment debt by the Civil Aviation Authority of Zimbabwe (CAAZ).
At its instance, the Civil Aviation Authority of Zimbabwe (CAAZ) was, by consent, joined to the proceedings a quo as the second defendant, on 8 March 2016.
On 7 August 2016, the Civil Aviation Authority of Zimbabwe (CAAZ) pleaded that it was enjoined by sections 45, 45(1)(o) of the Civil Aviation Act as read with sections 3(1) and (4) of SI 67/97 and Article 15 of the Chicago Convention on International Civil Aviation to charge, for its own account, boarding fees, bussing fees, parking fees, landing fees and navigation or en route fees for the use of its airport facilities and air space.
In addition to these charges, it levied the airlines the similarly named landing, en route, and departure fees under the acronym “Met fees” on behalf of the Meteorological Services Department (MSD) for the use of the aeronautical weather services provided to the airlines by the MSD.
To wit, the appellant averred that the Met fees levied on the globalized invoice constituted a duplication of the separate and distinct line items of the same name charged for the account of the Civil Aviation Authority of Zimbabwe (CAAZ).
THE ISSUES REFERRED TO TRIAL A QUO
The court a quo was required to determine whether the claims prior to 22 August 2008 had prescribed, and, whether the appellant was indebted to the Minister of Environment, Water and Climate (the Minister) in the amount claimed or in any lesser amount.
In determining the second issue, the court a quo was enjoined to decide whether there had been any duplication of the landing, en route, and departure fees chargeable for the account of the Civil Aviation Authority of Zimbabwe (CAAZ) and the unpaid Met fees sought by the Minister.
THE EVIDENCE
The monthly tax invoices issued to the appellant between 2009 and 2016 show, that, the meteorological weather service fees (Met fees) constituted between 4 percent and 7 percent of the similarly named fees charged for the account of the Civil Aviation Authority of Zimbabwe (CAAZ). The number of airline operators in Zimbabwe during the 2006 to 2016 period ranged between a minimum of 45 and a maximum of 85 airlines. An average of 60 percent of the airlines paid the Met fees.
The appellant produced proof of monthly payments of the fees charged less the disputed Met fees for the period November 2008 to January 2017. It declared, in its respective remittances, that, it would not pay the Met fees until the dispute was resolved.
The Minister of Environment, Water and Climate (the Minister) called the oral testimony of his former Meteorological Services Department (MSD) Fund Administrator, Morris Vengesai Sahanga.
He narrated the consultations and agreement reached with the airlines for the levying of the meteorological weather service fees (Met fees). He asserted, that, at the time, all the airlines appreciated the distinction between the similarly named prospective charges sought by the MSD. The aviation weather services provided to airlines encompassed temperature, wind direction and speed, and atmospheric pressure forecasts to the airlines flying over, landing in, and departing from Zimbabwe.
The information was relayed through the Civil Aviation Authority of Zimbabwe (CAAZ).
He produced the monthly schedules and the invoices of the amounts billed, paid, and unpaid by the appellant during the period from 1 January 2009 to the date of summons.
He asserted, that, the Met fees due to the MSD were distinct from those of a similar name charged by CAAZ for its own account. The Met fees were for the provision of the aviation weather services that he narrated while those for the account of CAAZ were for the use of CAAZ's infrastructure and the Zimbabwe air space.
The Permanent Secretary, Grace Tsitsi Mutandiro, testified that the Meteorological Services Department (MSD) was transferred to the Minister of Environment, Water and Climate (the Minister) with all its assets and liabilities.
The Civil Aviation Authority of Zimbabwe (CAAZ) charges were for the use of the local airspace and its landing and take-off infrastructure and not for the utilization of weather information.
The appellant's application for absolution from the instance was dismissed in a separate judgment, issued as HH173-19, on 6 March 2019.
Thereafter, it dispensed with the calling of oral evidence in preference to the documentary evidence produced by consent at the commencement of trial.
The Civil Aviation Authority of Zimbabwe (CAAZ) declined to participate in the trial, opting to abide by the order of the court.
THE CONTENTIONS A QUO
It was common cause, that, the amounts sought for the period January 2006 to 21 August 2008 is in the total sum of US$274,944 consisting of US$104,085 for 2006; US$96,637 for 2007; and US$74,222 for the period commencing 1 January 2008 to 21 August 2008.
The appellant contended, that, the claims preceding 22 August 2008 constituted a debt owed to the State, which, in terms of section 15(c)(ii) of the Prescription Act, prescribes after six (6) years.
It further argued, that, the claimed meteorological weather service fees (Met fees), subsequent to 22 August 2008, duplicated landing and en route fees charged for the account of the Civil Aviation Authority of Zimbabwe (CAAZ), which it discharged in full.
It also argued, that, the Minister of Environment, Water and Climate (the Minister) lacked locus standi to sue for the fees in question on the following bases:
(i) Firstly, that, the claim arose before the Meteorological Services Department (MSD) was assigned to him.
(ii) Secondly, that, an unspecified section of the Meteorological Services Act conferred the exclusive right to sue or be sued on the Director of the Meteorological Services Department (MSD).
(iii) Lastly, that, sections 6(1)(d), 45(1) and 47 of the Civil Aviation Act, which came into effect on 1 January 1989, imbues the Civil Aviation Authority of Zimbabwe (CAAZ) with the sole and exclusive power to provide aeronautical information services and charts of aerodromes, air traffic control, meteorological services, hazards to air navigation, and the right to levy fees and charges.
In its closing submissions, the appellant also argued, that, the Minister of Environment, Water and Climate (the Minister) did not have a cause of action against it.
Per contra, the Minister of Environment, Water and Climate (the Minister) contended, that, the meteorological weather service fees (Met fees) constituted a tax, which, in terms of section 15(a)(iii) of the Prescription Act, only prescribed after a period of 30 years.
He also contended, that, the appellant did not pay any Met fees, which were demonstrably distinct from the similarly named fees paid to the Civil Aviation Authority of Zimbabwe (CAAZ) for the use of its own facilities and infrastructure.
In regards to locus standi, he contended, that, as the Minister in charge of the Meteorological Services Department (MSD), who assumed its assets and liabilities on assignment, he had the necessary legal standing to recover its debt in terms of section 3 of the State Liabilities Act [Chapter 8:14] as read with section 39 of the Interpretation Act [Chapter 1:01].
The Minister also contended, that, he had not only a statutory cause of action but also a contractual one.
THE FINDINGS OF THE COURT A QUO
The court a quo found against the appellant on all the issues that were referred to trial. It held, that, the Minister of Environment, Water and Climate (the Minister), as the authority assigned to administer the Meteorological Services Department (MSD) and its constituent legislation, had the requisite statutory locus standi to sue for the recovery of the debt notwithstanding that some of it had been incurred when the MSD fell under the auspices of the Minister of Transport and Infrastructural Development.
It further held, that, the Meteorological Services Department (MSD) was neither autonomous nor imbued with legal capacity, but, falls under the aegis of the Minister assigned to administer the Meteorological Services Act when action is instituted.
It reasoned, that, the provisions of sections 3, 4, 6 and 8 of the Meteorological Services Act gave the Minister a direct and substantial interest and over-arching control in the operations of the Meteorological Services Department (MSD).
It also held, that, the Minister of Environment, Water and Climate derived his locus standi from the common cause fact, that, the Civil Aviation Authority of Zimbabwe (CAAZ) was an agent of the Meteorological Services Department (MSD).
It further found, that, the Minister's cause of action against the appellant, and his legal right to sue for any debts accrued before the Meteorological Services Act was assigned to him.
On prescription, the court held, that, the debt was in the nature of a tax and would therefore prescribe after a period of 30 years. It further held, that, the essential factors that constitute a tax, which were enunciated in Nyambirai v National Social Security Authority & Anor 1995 (2) ZLR 1 (S)…, were fully met.
The court a quo reasoned, in its judgment, at p899 of the appeal record, that:
“In casu, we are dealing with some levies that the first defendant is obligated to pay under the relevant enactments, especially the MSA. For that reason, this is not only a debt due to the State but also levied under some enactments. It would not be correct to strictly interpret that the debt is owed to the State only and disregard statutory obligations. I would therefore agree, that, the debt in casu is also covered under section 15(a), and, for that reason, part of the debt is not prescribed.”
THE GROUNDS OF APPEAL
The appellant is aggrieved by the findings of the court a quo. It appeals to this Court on the following grounds:
“1. The court a quo erred and misdirected itself in law in failing to find, that, the first respondent's claim, in so far as it related to the period prior to 22 August 2014, had prescribed by dint of the provisions of section 15(c)(ii) of the Prescription Act [Chapter 8:11].
2. Having found, as it did, that, the administration of the Meteorological Services Act [Chapter 13:21] was assigned to the 1st respondent on the 7th February 2014, the court a quo erred in law in finding, as it did, that, the 1st respondent had a statutory claim against the appellant retrospectively, to wit, from January 2006.
3. The court a quo erred and misdirected itself in law in failing to find, that, by dint of the provisions of section 6(3) of the Meteorological Services Act [Chapter 13:21], the 1st respondent had no direct statutory nexus with the appellant in respect of the provisions of the meteorological weather services and could therefore not sustain a statutory claim against the appellant.
4. The court a quo erred and misdirected itself in failing to find, that, by dint of the provisions of sections 6(1)(d), 45 and 47 of the Civil Aviation Act [Chapter 13.16], the statutory duty to provide meteorological services to the appellant, and other airlines, exclusively reposed in the Civil Aviation Authority of Zimbabwe (the second respondent herein).
5. By extension, the court a quo further erred in then failing to find, that, only the Civil Aviation Authority of Zimbabwe could institute a claim for meteorological services against the appellant.
6. It being common cause, that, the appellant had, during the material period, paid the meteorological services to the Civil Aviation Authority of Zimbabwe (2nd respondent herein) the court erred in failing to find, that, the claim by the 1st respondent constituted a duplication of the same statutory claim.
7. Overall, having found as it correctly did, that, the disposition of this matter turned on questions of law only, the court a quo erred and misdirected itself at law by failing to determine the question of the establishment of a cause of action by the 1st respondent by reference to the applicable statutory provisions.
8. The court a quo erred in granting an order for costs on a legal practitioner and client scale in situations where there was no basis for such punitive costs.”
It seeks the success of the appeal with costs and the setting aside of the judgment and its substitution with a dismissal of the first respondent's claim with costs.
THE ISSUES ON APPEAL
These eight grounds of appeal raise the following three issues:
1. Whether or not the respondent had locus standi to institute proceedings and had a cause of action against the appellant.
2. Whether or not the court a quo erred when it held, that, part of the claim had not prescribed.
3. Whether or not the court a quo could properly impose costs on a higher scale.
THE SUBMISSIONS BEFORE THIS COURT
Counsel for the appellant submitted, that, the question of whether or not the Minister had established a cause of action as against the appellant could be dispositive of the appeal.
In this regard, he contended, in the main, that, notwithstanding that the Meteorological Services Department (MSD) was the ultimate source of the meteorological services, the Civil Aviation Authority of Zimbabwe (CAAZ), and not the Minister, had, in terms of sections 6(1)(d), 45 and 47 of the Civil Aviation Act, the exclusive statutory duty to provide meteorological services to the appellant.
He also took the alternative point, that, such a statutory duty could possibly fall on the Director of the Meteorological Services Department (MSD) and not his Minister.
He premised the alternative contention on the provisions of section 6(3) of the Meteorological Services Act, which reposes on the Director the power to make suitable financial arrangements for the provision of meteorological services with other State entities.
He resultantly conceded the validity of the agreement executed between the Meteorological Services Department (MSD) and the Civil Aviation Authority of Zimbabwe (CAAZ) on 23 June 2006.
He however contended, tongue in cheek, that, the effect of that agreement was that the MSD could only seek recompense from CAAZ and not the appellant.
He, therefore, nailed his contentions on the mast of the Civil Aviation Act and submitted, that, as the Meteorological Services Act did not expressly confer the Minister with the requisite right of action as against the appellant, it was remiss of the court a quo to find that he had both the locus standi and the concomitant cause of action to sue the appellant.
Regarding the question of prescription, he submitted, that, it was not necessary for the appellant to lead evidence to establish the existence of prescription. This was because the facts from which the issue of prescription could be determined were correctly found by the court a quo to have been common cause.
He therefore contended, that, the claims prior to 22 August 2008 had been extinguished by prescription. He strongly argued that these claims constituted an ordinary debt owed to the State and were not in the nature of a tax. They had, thus, prescribed after a period of six years and would not do so after thirty years.
Counsel for the Minister made the contrary contentions, which we summarize in this paragraph and in paragraphs [24] and 25].
The failure by the appellant to lead evidence on the existence of prescription or the prescribed amounts was fatal to its special plea.
The requirement to lead evidence to establish a special plea is enunciated in Van Brooker v Mudhanda & Anor and Pierce v Mudhanda & Anor SC05-18…, and in HERBSTEIN and Van WINSEN: The Civil Practice of the High Courts of South Africa, 5th ed…,.
The question of the Minister's entitlement to sue for the debt owed to the Meteorological Services Department (MSD) was asserted in paragraphs 3 to 5 of his declaration.
It was not disputed by the appellant, in paragraph 3.2 of its plea, which was never subsequently amended. It is therefore taken to have been admitted.
The appellant also expressly admitted, that, the Civil Aviation Authority of Zimbabwe (CAAZ) was the Minister's duly authorized collecting agent to whom it had paid the claimed amounts.
It could, therefore, not properly argue against the Minister's causa or locus standi without amending its pleadings or leading any evidence.
The date of assignment to the Minister could not, and did not, retrospectively affect the existence of the cause of action nor his legal capacity to claim the debt.
The assignment of functions did not create a new law nor extinguish extant obligations that arose before the assignment.
This position is codified by section 39 of the Interpretation Act [Chapter 1:01], which, in essence, equates an assignment with a cession.
The statutory cause of action is to be found in the Meteorological Services Act and the Meteorological (Aviation Weather Services) Regulations SI 32/2005.
These two pieces of legislation impose an obligation upon the appellant to pay for the services that it enjoys when its aeroplanes use Zimbabwean's airspace and airports. These extant pieces of legislation, and the administrative acts made under them, enjoy a presumption of validity, remain lawful and binding, bidding obedience from all subjects of the law - inclusive of the appellant.
ANALYSIS
The second, third, fourth and fifth grounds of appeal raise the sole issue of whether or not the Minister had the legal standing to sue the appellant in respect of the provision of the aeronautical weather services.
The seventh ground of appeal deals with the question of whether he had a cause of action as against the appellant. Aligned to it is the sixth ground, which relates to the duplication between the claimed “Met fees” and the landing and over flight fees paid to the Civil Aviation Authority of Zimbabwe (CAAZ).
The first ground deals with the issue of prescription, while the last ground questions the propriety of the court a quo's costs order....,.
WHETHER COSTS ON THE HIGHER SCALE WERE APPROPRIATE A QUO
The imposition of costs is always in the discretion of a court seized with the matter.
The court a quo did not justify the imposition of costs on the higher scale. The failure constitutes a misdirection: see Barros v Chimphonda 1999 (1) ZLR 58 (S) and PG Industries (Zimbabwe) Ltd v Mark Bvekerwa & Ors SC53-16…,.
We are therefore at large.
We take the view, that, the issues raised a quo were neither frivolous nor vexatious. They did not constitute an abuse of court process, but, raised important legal issues concerning the Minister's legal standing in the light of the provisions of both the Civil Aviation Act and the Meteorological Act, and the determination of whether or not the fees constituted a tax.
In our view, the suitable order for costs a quo should have been on the ordinary scale.
The last ground of appeal is meritorious and must succeed....,.
1. The appeal be and is hereby allowed in part.
2. The judgment of the court a quo be and is hereby amended in paragraph 4 to read:
“The first defendant shall pay the plaintiff's and the second defendant's costs of suit on the ordinary scale.”
