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Minister of Environmental Affairs and Another v ArcelorMittal South Africa Limited SCA (17 April 2020)

17 April 2020

Supreme Court of Appeal

Coram: Petsa DP, Swain, Mokgohloa and Mbatha JJA and Koen AJA

Judgment: Petse DP (unanimous)

Heard on: 21 February 2020

Judgment delivered on: 17 April 2020

Neutral citation: Minister of Environmental Affairs and Another v ArcelorMittal South Africa Limited (Case no 342/2019) [2020] ZASCA 40 (17 April 2020)

Download the judgment here.

Order: Appeal dismissed with costs. Judgment of the High Court supplemented.

Facts: ArcelorMittal South Africa Limited (AMSA) manufactures steel products and a byproduct from its operations at its Newcastle site is slag. Some of the slag was disposed at an old disposal site which had been operated since the 1970s. Some of the slag was sold to third parties. During 2014, officials from the Department of Water Affairs inspected the site. Various exchanges between the Department of Environmental Affairs (the Department) and AMSA culminated with AMSA being issued with a compliance notice and directive under section 31L and 28(4) of the National Environmental Management Act (NEMA) in 2015.

The Department advised AMSA that disposal of the slag to its old disposal site was unlawful as AMSA did not have a waste management licence (WML) for disposal at this site. AMSA did however hold a WML for disposal of slag at its new facilities. The Department also advised AMSA that it was not allowed to sell the slag to parties who did not hold WMLs themselves.

AMSA objected to the compliance notice and argued that it had been disposing slag prior to the enactment of environmental laws requiring licences and therefore did not require a WML. AMSA contended that the slag was not “waste” as defined in the National Environmental Management: Waste Act (NEMWA). It lodged an internal appeal against the directive. The Minister dismissed both the objection and the appeal arguing that AMSA had been issued with both a decommissioning licence for the old dispoal site and a WML (for  its new slag disposal facilities) and was bound to comply with the conditions in these licences.

AMSA approached the High Court seeking various orders including the review and setting aside of the directive and compliance notice and the review of the Minister’s dismissal of AMSA’s internal appeal. The High Court upheld AMSA’s review application.

In its judgment, the High Court concluded that the decisions of the Department were ‘materially flawed or influenced by an error of law or fact.’ The High Court held that AMSA did not require a WML in respect of its old disposal site because it had been in existence prior to the commencement of the ECA and NEMWA. It found that if the Department sought to bring AMSA within the purview of the NEMWA, the Minister ought to have invoked her statutory powers in terms of section 80(4) of NEMWA, which she had failed to do.

The High Court inadvertently omitted to set aside the directive and compliance notice in its judgment.

The Department unsuccessfully appealed to the Supreme Court of Appeal (SCA). The SCA found that the slag did not constitute ‘waste’ for the purposes of NEMWA, and found that the decomissioning licence and WML held by AMSA did not preclude use of its old disposal site.

The SCA set aside the directive and compliance notice.