SUMMARY

CASE NO. A 48/2009

ONYEKA CLEARING AND FORWARDING CC Applicant

and

MINISTRY OF FINANCE Respondent

SILUNGWE, AJ

2009/03/26

PRACTICE - Applications and motions – Urgent application – Requirements for – Requirements of Rule 6(12)(b) – Both requirements must be satisfied – Requirement that applicant cannot be afforded substantial redress at hearing in due course not proved – Consequence of.

- Applications and motions – No urgency, urgency self-created through remissness.

PRACTICE - Applications and motions – Affidavits – Leave to file confirmatory affidavit on limited issue – Filing of further affidavit impermissible – Applicant must make out case in founding affidavit.

INTERDICT - Interim interdict – Requirements of – Failure to prove requirements of.

CASE NO.: A 42/2009

IN THE HIGH COURT OF NAMIBIA

In the matter between:

ONYEKA CLEARING AND FORWARDING CC Applicant

and

MINISTRY OF FINANCE Respondent

CORAM: SILUNGWE, AJ

Heard on: 2009/03/03 – 04

Delivered on: 2009/03/26

JUDGMENT:

SILUNGWE, AJ: [1] This application is brought on an urgent basis for interim relief in the following terms:

1. Dispensing with the forms, service and compliance with the time limits prescribed by the Rules of Court … and condoning the applicant’s failure to comply therewith and directing that this matter be heard as one of urgency as envisaged in Rule 6(12) of the Rules.

2. That a rule nisi do hereby issue calling upon the respondent to show cause, if any, to this Court on a date to be determined by the Court why an order should not be made in the following terms:

2.1 That the respondent’s decision to close the applicant’s counters be set aside;

2.2 An order compelling the respondent to forthwith open the counters of the applicant;

3. That the order in terms of sub-paragraphs 2.1 to 2.2 hereof shall serve as an interim interdict with immediate effect pending the finalization of this application.

[2] The applicant is a duly licenced and registered customs clearing and forwarding agent whose director is Mr Malakia Elindi. It is represented by Mr Boesak, while the respondent is represented by Ms Katjipuka-Sibolile (Katjipuka).

[3] At the conclusion of the hearing, the respondent was given leave to file a confirmatory affidavit and the applicant, too, was given leave to reply to the respondent’s confirmatory affidavit. Rather inexplicably, the applicant has abused the occasion by filing a further affidavit deposed to by Mr Naphtali Tuhafeni Haushona, the “proprietor” of Global Marketing Agency CC. The respondent takes issue with this turn of events, and properly so, as it is unable to deal with Mr Haushona’s further affidavit, with the result that it is thereby prejudiced. Ms Katjipuka contends that, as the matter had been heard, it was only in respect of the limited issue for which leave was granted that it was permissible for the respondent to file a confirmatory affidavit and a reply thereto by the applicant. I agree. In addition, she stresses that the applicant should make out its case in its founding affidavit. I find merit in Ms Katjipuka’s contentions and rule that Mr Haushona’s affidavit is impermissible. Incidentally, Mr Haushona is the one whose whereabouts the applicant claims (in his founding affidavit) that he has had no knowledge of since last year, and against whom he has laid criminal charges, jointly with Global Marketing Agency CC, for fraud and uttering.

[4] The background of this matter is as follows. On July 7, 2008, the applicant addressed a letter to the respondent’s Controller of Customs & Excise, Trans Kalahari Border Post, in these terms:

We would like to inform you that Onyeka Clearing & Forwarding is giving authorization to the following person to use their bond No. NAM 05 737.

Consignee Name: Global Marketing Agency

145 Nelson Mandela Avenue

Windhoek

Commodities: Cigarettes

Value: USD 55 000-00

Quantity: 440 Cartons

[5] It is not in dispute that at the time the consignment entered the country, the applicant was, and apparently still is, in possession of two licences, one of which entitles him to operate as a clearing agent; this licence requires him to provide a bond or guarantee from a bank in the sum of N$10 000-00, which, according to Mr Elindi’s replying affidavit (on behalf of the applicant) has been increased to N$20 000-00. In terms of this licence, the bond is required for the purpose of covering duties and taxes relating to goods cleared as well as to taxes imposable upon the clearing agent. This is the licence that has been “suspended temporarily” and is the subject of these proceedings. Mr Elindi points out in his replying affidavit that, in all correspondence, the respondent refers to closure of the applicant’s customs & excise clearing agent counter. The second licence, which is number NAM OS 737, entitles the applicant to operate a Customs & Excise Ordinary Storage (OS) Warehouse for which the applicant had to provide a bank bond or guarantee in the sum of N$50 000-00. This licence requires the applicant to store juice, fruit, electrical parts and motor vehicle parts. Strangely enough, this licence relates to the applicant’s warehouse that was earmarked for the storage of Global Marketing Agency’s imported cigarettes which the licence did not cover!

[6] On July 10, 2008, the applicant addressed another letter to the respondent’s Chief Customs and Excise Office, Windhoek Regional Office, which reads:

…

We at Onyeka would like to apply for a temporary (sic) storage of 440 cartons cigarettes for a period of 30 days only, as from 11 July 2008. The reason for keeping the goods is to give time for Global Marketing to arrange the duties money or export the cigarettes outside common monetary area.

…

[7] It is common cause that the foregoing application was received by the respondent and that no response thereto was made in writing.

[8] Mr Godfrey Libetwa Kabozu, the Director of Customs & Excise, avers in his answering affidavit, on behalf of the respondent, that despite the fact that the applicant had not received the authorization requested on July 11, 2008, it went ahead and obtained “the customs declaration form” (attached to its founding affidavit) on the basis of which it was “allowed to remove the 440 master case of cigarettes” from the Regional Customs and Excise Office. The declaration form, continues Mr Kabozu, (purportedly) authorized the applicant to store the consignment of 440 cigarettes in its NAM OS 737 warehouse. Instead, the applicant stored the consignment in the warehouse of Atlantic Leather CC which had not been indicated in the declaration form neither was it duly registered with Customs & Excise as a bonded warehouse and was thus unauthorized to hold excisable goods. It is further affirmed as follows:

I point out that neither applicant nor Atlantic Leather CC claim to have been in possession of the required authority by Customs and Excise. I also point out that by taking possession of the consignment and storing it in a warehouse without the requisite authorization, applicant not only contravened the terms of the purported declaration form … but also the Act in this regard.

[9] Mr Kabozu states that Mr Sackaria Nambahu, a Senior Customs & Excise Officer of his Directorate, who had carried out investigations in the matter, revealed that the address given by Global Marketing Agency as 145 Nelson Mandela Avenue is in fact the seat of Nampol Explosive Unit, as is borne out by Mr Nambahu’s confirmatory affidavit.

[10] In his founding affidavit Mr Elindi states, on behalf of the applicant, that in the morning of 11^th July, 2008, the applicant was approached by Global Marketing Agency CC, the importer of the cigarettes, for assistance regarding the temporary storage of the consignment in transit to Angola. The applicant then requested the respondent’s “customs officials for a waiver of the applicable rules concerning storage of excisable goods and for authorization to store the 440 cartons of cigarettes for a 30 day temporary storage period”. According to the deponent, “authority for temporary storage was granted” and an inspection of the place – which Mr Elindi personally attended, was conducted on 14^th July 2008. Upon inspection, it was established that about 10 cartons of cigarettes were missing. The consignment was then stored at a designated warehouse of Atlantic Leather CC. It is pointed out that the Customs & Excise officials never queried about the place at which the consignment was stored.

[11] Mr Boesak contends that, although there was no written response to the applicant’s application, the respondent’s subsequent conduct, such as the inspection of the goods in question, by the respondent’s Customs & Excise officials at the warehouse where the consignment had been stored, was evidence that such authority had been tacitly granted! On the contrary, however, Ms Katjipuka is categorical in her submission that the applicant’s application for permission to store the consignment was never granted, either expressly or tacitly. She submits that the Customs and Excise Act, Act 20 of 1998 (Act), makes no provision for waiver; that such an application can only be made to the Commissioner of Customs and Excise, in terms of section 67(4) of the Act, and that the Commissioner alone can grant or refuse such application. In any event, the allegation that the application (authorization) was granted by conduct of the respondent’s Customs & Excise officials is vehemently denied. According to Mr Kabozu, prior to Mr Elindi’s involvement in private business, he was a civil servant in the respondent’s Directorate of Customs and Excise from May 5, 1995, to July 4, 2001, and that he served in the Regional Office, which is mandated with clearing responsibilities. In the light of this averment, Ms Katjipuka contends that Mr Elindi is, or should be, presumed to be conversant with the provisions of the Customs and Excise Act.

[12] Mr Kabozu states in his answering affidavit that, when it became clear to him that the applicant had contravened provisions of the Act and that the consignment which had last been in the applicant’s possession had disappeared, he convened a meeting scheduled for January 27, 2009, to which Mr Elindi was invited to come and provide clarity. The meeting was attended by Mr Elindi, Messrs Marenga and Titus as well as Ms Salimi Shikulo, the latter three being staff members in the Directorate of Customs and Excise. Also in attendance was, of course, Mr Kabozu. At the meeting, Mr Elindi was requested to provide information concerning the whereabouts of his client (i.e. Global Marketing Agency CC); to provide proof of the alleged authorization that he claimed to have obtained and which allowed him to store excisable goods (in a third party’s non-bonded warehouse that had not been registered with the respondent’s Customs and Excise Office). Mr Elindi was accorded time until January 30, 2009, within which he was required to provide the requisite information. When such information was not forthcoming, the respondent addressed the following letter to the applicant on February 3, 2009 (which is attached to the applicant’s founding affidavit as Annexure F18):

…

Subject: Closure of your Customs and Excise Clearing Agent counter.

We are hereby informing you that following an incident in which Mr Naftali Uushona of Global Marketing Agency imported a consignment of 440 boxes of cigarettes that disappeared from the Warehouse; Customs has made several attempts to trace him. However, we did not manage to do so.

Due to the fact that you acted as Clearing Agent, you are hereby notified that Customs and Excise has decided to extend its request for your cooperation in this regard until Friday the 6^th of February 2009 before 14h00. Failure to do so will result in your counter being closed with immediate effect due to the following reasons.

1. You have been informed verbally on the 27^th January 2009 to get hold of Mr Naftali Uushona (your client) and furnish us with the information before the 30^th of January 2009, which never materialized.

2. Secondly, you have contravened the Customs and Excise Act No. 20 of 1998, section 19, subsection 8, based on the excisable goods (Cigarettes) that you cleared to be stored in your Warehouse. Whereas your Storage Warehouse is not authorized to store any excisable goods.

3. Thirdly, you have stored these goods in a non registered Storage Warehouse without customs authorization as per Customs and Excise Act, section 19(9).

…

Mr Elindi claims, in his correspondence of February 5 (misdated January 5, 2009), that he responded to the respondent’s letter of February 3, as follows:

…

CLOSURE OF ONYEKA CLEARING AND FORWARDING COUNTER

We acknowledge receipt of your letter dated 3^rd of February 2009. In relation to the above subject the following (sic) is pertinent:

1. Onyeka Clearing and Forwarding is aware that its bond does not cater for excisable products; therefore I wrote a letter to Customs asking permission to store goods (cigarettes) temporary for 30 days before I pass the IM 7.

2. Global Marketing represented by Naftali Uushona removed the consignment from the warehouse without any consent and with customs supervision according to Naftali.

3. Subsequently, I laid a charge of fraud and uttering against Global Marketing for framing an export document with Onyeka Password without my authorization.

All the above information will be presented on or before the 20^th February 2009, as I will travel out of town tomorrow the 7^th February and be back only after the 15^th.

I pose here to mention that the allegation in para 2 of Mr Elindi’s letter above that the removal of the consignment was done with customs officials’ supervision is highly contentious.

It is quite clear from the applicant’s own papers (see annexure F19 dated February 19, 2009: an Appeal to the respondent’s Permanent Secretary against closure of the applicant’s Clearing and Forwarding Counter) the foregoing letter was sent “to a wrong fax number”. Mr Kabozu avers that the said letter was received by his Directorate’s Bond Section on February 19, 2009, at 16h30, as Annexure GK5 to his answering affidavit demonstrates.

[13] As the respondent received no response to the letter of February 3, it addressed the following letter to the applicant on February 12:

Subject: Closure of your Customs and Excise Clearing Agent Counter.

The letter dated 3^rd of February 2009 has reference:

You have failed on several occasions to meet our request by providing us with the relevant needed information.

Therefore, the Directorate of Customs & Excise decided to close your counter with immediate effect at any Customs operational office, until you furnish us with the required information.

[14] Mr Kabozu explains that the words “closing the applicant’s counter” are an expression of art which essentially means that the suspension of his licence as a clearing agent is of a “temporary nature”.

[15] At a meeting of February 18 held with the applicant, represented by Mr Elindi, Mr Kabozu upheld the respondent’s decision to keep the applicant’s Clearing and Forwarding Counter closed until duties and taxes due to the respondent were paid in full.

[16] On February 19, the applicant launched an appeal to the respondent’s Permanent Secretary against the respondent’s decision to close the applicant’s Clearing and Forwarding Counter. The Permanent Secretary wrote back the same day stating thus:

RE: APPEAL FOR LIFTING OF THE CLOSURE OF ONYEKA CLEARING AND FORWARDNG COUNTER

Your letter dated 19 February 2009 with regard to the above refers.

After thorough consultations and reflection on the facts submitted to me by the officials in the Directorate of Customs and Excise I am of the opinion that as a Clearing agent you were responsible for the movement of the cigarettes consignment up to the time it leaves Namibia to Angola.

Since the cigarettes have disappeared whilst in your custody and no indication has been established that they have left Namibia to Angola you are solely responsible for the duties and taxes due to the State. Until such time that the excise duties are paid in full, I cannot see my way clear to instruct the opening of your Clearing and Forwarding Counter.

The said duties and taxes amount to N$1 768 801-00. The significance of the Permanent Secretary’s letter is that, once the condition of payment in full is met, the suspension of the applicant’s Clearing and Forwarding Counter would be lifted. It was that unsuccessful appeal that prompted the applicant to institute these proceedings.

[17] Against the foregoing background, the applicant claims that the matter is an urgent one in that the closure of its Clearing and Forwarding Counter has adversely affected its business and operations as it has more than 120 clients with different goods awaiting to be cleared. Other reasons that allegedly make the matter urgent are that -

2. the applicant has a shipment that was supposed to be cleared by the 19^th of February worth in excess of N$20 million which it could not clear because of the closure of its clearing counter;

3. it has an average earning of N$30 000-00 per day in all customs clearing outlets and has employees and families who rely on the applicant’s clearing and forwarding operations; and

4. there is no prejudice that the respondent is likely to suffer as the applicant’s bond in excess of N$50 000-00 is in the respondent’s possession.

[18] The respondent denies that the matter is urgent, adding that the alleged urgency is self-created by the applicant’s remissness in that, despite various requests by the Directorate of Customs and Excise, the applicant has failed to cooperate. It is further contended, not only that at no time has the applicant attempted to purge its “illegal behaviour” but also that the applicant has tendered no valid guarantee in respect of the consignment aforesaid concerning which the applicant’s liability started to run from the time it took possession thereof until such consignment was exported or transferred to a third party. Besides, Ms Katjipuka submits that the applicant has failed to meet all the requirements of urgency in terms of Rule 6(12) of the Rules of the Court. For ease of reference, that Rule provides that –

6(12) (a) In urgent applications the Court or the Judge may dispense with the forms and service provided for in these Rules and may dispose of such matter at such time and place and in accordance with such procedure (which shall as far as practicable be in terms of these Rules) as to it seems met.

(b) In every affidavit or petition filed in support of any such application under (a) of this subrule, the applicant shall set forth explicitly the circumstances which he or she avers render the matter urgent and the reasons why he or she claims that he or she could not be afforded substantial redress at the hearing in due course.

[19] On a proper reading of Rule 6(12)(b), it is evident that, for an applicant to succeed under this subrule, both requirements stipulated therein must be satisfied, to wit, the applicant shall set forth explicitly:

1. the circumstances which he or she avers render the matter urgent; and

2. the reasons why he or she could not be afforded substantial redress at he hearing in due course.

See: Clear Channel Independent Advertising Namibia (Pty) Ltd and Another v TransNamib Holdings Ltd and Others 2006 (1) NR 121 at 126H-127A-B. Whereas the first requirement has, in my view, essentially been satisfied in casu, the second one has not. Nowhere in the applicant’s founding affidavit, let alone in the replying affidavit, are any reasons provided why the applicant cannot be afforded substantial redress at the hearing in due course. As it is imperative for an applicant to comply with both requirements, compliance with one requirement only, as in casu, is not enough, with the result that it augers badly for the applicant. See: Clear Channel Independent Advertising v TransNamib Holdings, supra, at 127A-B and the cases there cited.

[20] In her further argument, Ms Katjipuka highlights Mr Kabozu’s averment that there is no urgency and that the alleged urgency is self-created. This is so, continues Ms Katjipuka, because the applicant’s Mr Elindi had been requested both in person and in writing to furnish the requisite information and had been given adequate time, and even time limits, within which to do so, but all that came to nothing. He was even given notice as to the consequence of his failure to comply with the respondent’s request, namely, closure of his clearing and forwarding counter, but this too cut no ice with him. When the appeal was unsuccessful, the applicant was informed in writing that its clearing counter would remain closed until full payment of the specified duties and taxes had been effected, but that condition still remains outstanding. For the reasons given by the respondent, I find merit in the argument that the applicant’s apparent urgency is self-created through its culpable remissness. See: Bergmann v Commercial Bank of Namibia Ltd and Another 2001 NR 48 at 49G-I.

[21] Even if my conclusions on the issue of urgency were to be wrong, which, in my view, are not, I am, in any event, not satisfied that the requirements of an interim interdict have been met by the applicant. The requirements are that the applicant must establish. (1) a prima facie right, though open to some doubt; (2) a well-grounded apprehension of irreparable harm if the interim relief is not granted and he is ultimately successful; (3) that the balance of convenience favours the applicant; and (4) that he has no other satisfactory alternative remedy. See: Mudge vs Ulrich No and Another 2006 (2) NR 616 at 619B-C.

[22] As regards the first requirement, Ms Katjipuka urges the Court to find that the applicant has failed to establish a prima facie right since he had no licence and no suitable Warehouse in which to store excisable goods. Moreover, he stored excisable goods in the third party’s warehouse which was not licensed with the respondent to store such goods; thus, the applicant acted in contravention of the Act.

[23] In my judgment, Ms Katjipuka’s argument is well founded. It is abundantly clear, on the facts of this matter, that from the inception of his involvement with the cigarettes imported into Namibia, the applicant was fully cognizant of its own status, namely, that it was not licensed to “cater for excisable products”, to use its own expression which features in his misdated letter of February 5, 2009 (Annexure F19(b)) to his founding affidavit). Thus, even when the applicant addressed the letter of July 7, 2008, to the respondent’s Controller of Customs & Excise at Trans Kalahari Border Post in which it informed the respondent that it was giving authorization to Global Marketing CC to make use of its (the applicant’s) Bond No. NAM 05 737; and addressed the application of July 10, 2008, to the respondent’s Chief Customs & Excise Office at the Windhoek Regional Office, seeking authorization for temporary storage of 440 cartons of cigarettes for a period of 30 days, the applicant was well aware that it was not licensed to handle such excisable cargo. It is common cause that the applicant received no written response to its application for authorization to store excisable goods. In the course of argument, the Court has drawn Mr Boesak’s attention to the fact that the Act does not seem to make provision for waiver, as alluded to by the applicant. Ms Katjipuka reiterates her submission that the Act makes no provision for the alleged waiver. After making submissions in favour of the applicant, Mr Boesak accepts that, in the event that the legislation does not expressly provide for waiver, then it (presumably such waiver) “is deemed to be unlawful”. Ms Katjipuka contends that, the Commissioner did not grant a licence to the applicant in respect of the excisable consignment in question. Indeed, as the applicant’s Mr Elindi is a former employee in the Directorate of Customs and Excise, and did carry out his duties in the Regional Office, he knew, or ought to have known, that the respondent had no power to grant him the waiver he had applied for as any such grant would be ultra vires and unlawful.

[24] There is no averment or argument on behalf of the applicant that the respondent acted unlawfully in closing the applicant’s clearing and forwarding counter; the argument is that the counter was arbitrarily closed. In this regard, Ms Katjipuka submits that, on the contrary, the counter was not arbitrarily closed, as alleged; that the applicant had been given ample opportunity and notice that failure to act as requested would result in the closure of its counter. I am satisfied that the applicant clearly saw the writing on the wall, but chose to disregard it, at its peril.

[25] For the reasons given, I have no hesitation in finding that the applicant has failed to establish a prima facie right.

[26] Turning to the requirement of a well-grounded apprehension of irreparable harm, should the interim relief not be granted, the applicant has an option to pay the duties and taxes and to thus avert such harm. Much of course, depends upon his ability to pay, or to raise, the requisite funds. Hence, this requirement too, has not been met.

[27] The next requirement is that the balance of convenience favours the granting of an interim relief. Here, I am of the view that, as the provisions of the Act are evidently on the side of the respondent, the balance of convenience favours it.

[28] The final requirement is that the applicant must show that it has no other satisfactory alternative remedy. Quite clearly, the applicant’s satisfactory alternative remedy would be to pay the necessary customs duties and taxes as these are seemingly inescapable.

[29] In the final analysis, I find that the applicant has failed to meet any of the requirements for an interim relief.

[30] In conclusion, I make the following order:

1. The application for the interim relief is dismissed.

2. The applicant is to pay the costs of these proceedings to the respondent.

_____________________

SILUNGWE, AJ

COUNSEL ON BEHALF OF THE APPLICANT:

Adv. Boesak

Instructed by: B D Basson Incorporated

COUNSEL ON BEHALF OF THE RESPONDENT:

Ms Katjipuka-Sibolile

Instructed by: Government Attorney