CIV/APN/394/91

IN THE
HIGH COURT OF LESOTHO

In the
matter between:

SWISSBOURGH
DIAMOND MINES (PTY) LTD APPLICANT

RAMPAI
DIAMONDS (PTY) LTD SIXTH APPLICANT

and

THE
COMMISSIONER OF MINES AND

GEOLOGY
NO. FIRST RESPONDENT

THE
ATTORNEY GENERAL SECOND RESPONDENT

CHAIRMAN
OF THE MINING BOARD THIRD RESPONDENT

REGISTRAR
OF DEEDS FOURTH RESPONDENT

LESOTHO
HIGHLANDS DEVELOPMENT

AUTHORITY
FIFTH RESPONDENT

JUDGMENT

Delivered
by the Honourable Chief Justice Mr Justice J.L. Kheola on the 28th
April, 1999.

This is a
counter-application by the fifth respondent (LHDA) against first and
sixth respondents for an order in the following terms:

1. Declaring
   mining lease registered under No.21044 in the Deeds Registry, in
   Maseru, on 26 October, 1988, entered into between the
   Basotho Nation
   and Swissbourgh Diamong Mines (Pty) Limited in respect of the Ramapi
   Area, void ab initio and of no force and
   2 effect;

   
   

2. Cancelling
   the entry in the register of the Registrar of Deeds, Maseru,
   relating to the aforesaid mining lease;

   
   

3. Ordering
   applicants and/or first to fourth respondents to pay the costs of
   this counter application only in the event that they
   should oppose
   it;

   
   

4. Granting
   such further or alternative relief as the Honourable Court may deem
   just and equitable.

   
   

For the
sake of convenience, I shall adopt Mr Edeling's suggestion and refer
to the first to sixth applicants as "SDM",
to fith
respondent as "LHDA" and to the other respondents as "GOL".

This
counter application is based on the ground that when the Rampai lease
was granted to SDM by GOL there was non-compliance with
the
procedures prescribed by sections 6 and 7 of the Mining Rights Act
No.43 of 1967, as amended. For the sake of easy reference
I shall
reproduce subsections (1), (2), (3) and (4) of section 6 of the
Mining Rights Act 1967 (M.R.A.), as amended. They read
as follows:

1. ........................The
   King and the Chiefs on his behalf, may in accordance with the terms
   of a recommendation of the Mining
   Board, and in the manner
   prescribed in this Act, but not otherwise, grant mineral titles
   (other than existing grants) but (subject
   to subsection (5) of this
   section) nothing in this section shall be construed as

   
   

3

fettering
the discretion of the King and the Chiefs on his behalf to refuse any
grant recommended by the Mining Board.

2. Any
   person may apply to the King for the grant of a mineral title (other
   than an existing grant). The application shall be in
   writing and
   shall be made in the first instance to the Minister by whom it shall
   be referred to the Mining Board in order that
   the latter may make
   its recommendation.

   
   

2. The
   Mining Board shall consider every application so forwarded, and may
   either decline to make any recommendation thereon, in
   which event it
   shall so inform the applicant, or may determine to recommend the
   grant of a mineral title of the kind applied
   for in respect of the
   land and on the conditions stated in the recommendation which may
   include conditions of the type referred
   to in subsection (3) of
   section 8 and subsection (3) of section 14. The recommendation shall
   be in writing and shall be forwarded
   to the Principal Chief or Ward
   Chief within whose jurisdiction the land in question falls
   accompanied (in the case of a recommendation
   for the grant of a
   prospecting lease or mining lease) by a written statement of the
   recommendation for the grant of a prospecting
   lease or mining lease
   shall be so forwarded unless the Mining Board shall have received
   from the applicant written approval of
   the terms of the lease which
   the recommendation proposes shall be granted.

   
   

2. Upon
   receipt of the application and the recommendation of the Mining
   Board thereon the Principal Chief or Ward Chief concerned
   shall
   consider them and shall consult with all those chiefs within the
   area of jurisdiction of each of whom any part of the land
   in
   question falls. If upon such consultation it shall appear to the
   Principal Chief or Ward Chief that a majority of those consulted

   approve of the grant of the application in terms of the
   recommendation he shall

   
   

4

grant it
accordingly; but if it shall appear to him that such majority
disapprove the grant he shall then, in his discretion but
subject to
subsection (5) of this section –

1. grant
   the application in terms of the recommendation; or

   
   

2. refuse
   the application; or

   
   

3. refer
   the matter back to the Mining Board for its recommendation upon any
   alterations which that Chief may propose.

   
   

2. If
   the application is granted in terms of item (i) of paragraph (a),
   the Principal Chief or Ward Chief concerned shall declare

   accordingly to the Mining Board, which shall inform the applicant
   and shall forthwith cause the relevant mineral title to be

   prepared, Upon the provision by the applicant of any guarantees or
   other instruments which the terms of the mineral title may
   require,
   it shall be signed by or on behalf of the King and the applicant in
   manner prescribed by paragraph (b) of subsection
   (6) of section 24
   and registered as so prescribed.

   
   

3. If
   the application is refused in item (ii) of paragraph (a), the
   Principal Chief or Ward Chief concerned shall declare accordingly

   to the Mining Board which shall inform the applicant.

   
   

4. If
   the matter is referred back in terms of item (iii) of paragraph
   (a), the Mining Board shall consider the reference and, after

   consultation with the applicant, either withdraw the recommendation
   (which shall then lapse) or submit a revised recommendation
   respect
   of which the provisions of subsection (3) and paragraphs (a), (b)
   and (c) of this subsection excluding subparagraph
   (iii) of
   paragraph (a) shall again mutatis mutandis apply."

   
   

5

The bone
of contention between the parties is the proper interpretation of
section 6 of the M.R.A. especially after the coup a etat
of 1970. Mr.
Edeling, counsel of SDM has submitted that the MRA of 1967 was
abolished by subsequent coups d'etat, and re-enacted
in amended form,
so as to do away with the earlier requirement of approval by the
chiefs. This submission is fully developed in
a legal opinion
prepared by Mr. Edeling as a consultant of SDM dated the 1st July,
1996. 1 shall deal with the legal opinion immediately
because it is
the basis of SDM's defence to the counter application.

But
before I do that it is important to reproduce Order No.1 of 1970
known as The Lesotho Order 1970 and Order No.1 of 1986 known
as
Lesotho Order 1986. These two Orders are particularly important
because of the alleged amendment they made to the MRA 1967.
Counsel
for SDM submitted that the Lesotho Order 1970 abolished or repealed
sections 6 and 7 of the MRA.

Section
1,2,3 and 4 of Order 1 of 1970 reads as follows:

1. (1) This Order may be cited as the Lesotho Order 1970 and shall be
deemed to have come into operation immediately before the
suspension
of the Lesotho Independence Order 1966.

6

(2) This Order and every legislative function performed thereunder
shall have the force of law.

2. (1) In
this Order, unless inconsistent with the context -

'Council
of Ministers" means the Council of Ministers established by
section 5 of this Order;

"existing
law" means any proclamation, law, rule, regulation, order or
other instrument having effect as part of the law
of Lesotho
immediately before the coming into operation of his Order but does
not include the Lesotho Independence Order 1966.

(2) If, under any provision of this Order, any person or authority is
authorised or required to exercise any function after consultation

with some other person or authority, the person or authority first
referred to shall not be required to act in accordance with
the
advice of the other person or authority and the question whether such
consultation was made shall not be enquired into in any
court.

3. (1)
   Subject to the provisions of this Order all laws (other than the
   Lesotho Independence Order) that were enforceable in Lesotho

   immediately before the coming into operation of this Order, shall
   continue to be of full force and effect:

   
   

Provided that any such law which is inconsistent with this Order
shall, to the extent of such inconsistency, be void.

(2) The provisions of this section are without prejudice to any
powers to make provision for any matter, including the amendment
or
repeal of any existing law.

(3) The existing laws shall, from the coming into operation of this
Order, be construed with such modifications, adaptations,
qualifications and

7

exceptions
as may he necessary to bring them into conformity with the provisions
of this Order.

4. (1) The executive authority of Lesotho is, for so long as this
Order remains in force, exercised by the King in all respects
in
accordance with the advice of the Prime Minister.

(2) The person holding the office of Prime Minister under the Lesotho
Independence Order immediately before the coming into operation
of
this Order is the holder of the office of [Prime Minister] as from
the commencement of this Order.

(3) Any reference in any law or notice to Tona-Kholo, or anything
done or purporting to have been done by any person holding the
office
of Tona-Kholo, shall be deemed to be a reference to the Prime
Minister, or to have been done by the Prime Minister, as the
case may
be.

Section
1, 2, 3 and 4 of Order of 1986 read as follows:

1. (i) This Order may be cited as the Lesotho Order 1986 and shall be
deemed to have come into operation on the 20th January, 1986.

(ii) This Order and every legislative function performed thereunder
shall have the force of law.

2. In this Order, unless inconsistent with the context -

"Military
Council" means the Council established by Section 5 of this
Order.

"Council
of Ministers" means the Council of Ministers established by
Section 7 of this Order.

"Existing
law" means any proclamation, law, rule, regulation, order or
other instrument having effect as

8

part of
the law of Lesotho immediately before the coming into operation of
this Order.

3. (i)
Subject to the provisions of this Order all laws that were
enforceable in Lesotho immediately before the coming into operation

of this Order, shall continue to be of full force and effect:

Provided
that any such law which is inconsistent with this Order shall, to the
extent of such inconsistency, be void.

(ii) The provisions of this section are without prejudice to any
powers to make provision for any matter, including the amendment
or
repeal of any existing law.

(iii) The existing laws shall, from the coming into operation of this
Order, be construed with such modifications, adaptations,

qualifications and exceptions as may be necessary to bring them into
conformity with the provisions of this Order.

4. (i) The legislative and executive authority in Lesotho is vested
in the King and may be exercised by him either directly or
through
officers or authorities of the Government of Lesotho.

(ii) In the exercise of his functions under this Order or any other
law the King shall act in accordance with the advice of the
Military
Council.

Mr. Edeling submitted that Jonathan's 1970 Constitution did not
recognise the King or the Chiefs, and the effect of this revolution

was to abolish the Monarchy and also any legal recognition of the
Chiefs. He relies on the words of Ackerman, J.A. in the case
of
Strong Thabo Makeuete v. General Justin

9

Metsing
Lekhanya and others 1991 - 1996 (1)LLR486 at pages 501-502 where

the
learned judge said:

"As
already pointed out Order No.1 of 1970 (following in the wake of the
1970 Constitution Suspension Order) made no provision
for the office
of King at all and vested legislative authority in the Council of
Ministers and executive authority to all intents
and purposes in the
Prime Minister. The conclusion cannot be avoided that, insofar as the
Monarchy in Lesotho was concerned, the
effect of 1970 Constitution
Suspension Order read with Order No.l of 1970, was to make a radical
break with the past and in truth
to abolish the Monarchy. The office
of King was only re-established in the Office of King Order No. 51 of
1970 and subsequently
certain further powers gradually reconferred on
Him in the manner outlined above. The consequence hereof is that, in
order to determine
what the constitutional position of the King was
immediately prior to the alleged coup d'etat of the 30th January
1970. In other
words, none of the rights, powers, prerogatives or
functions of the King which existed under and at the time of the 1966
Constitution
survived the 1970 coup d'etat, save to the extent that
they were re-introduced or re-incorporated by subsequent legislation.

In this
connection reference has already been made to the fact that the
Office of King was re-introduced with effect from 22th November
1970
by the Office of King Order No.51 of 1970, the King of Lesotho
re-established as Head of State, continuity being established
with
the person who held the Office of King under the 1966 Independence
Order and that, in terms of section 12, the King had the
right to be
consulted and kept fully informed concerning matters of government.
The Office of King remained substantially symbolic
until Lesotho
Order No. 13 of 1973 came into effect. The effect, for present
purposes, of this latter order was that the King could,
on the advice
of the Prime Minister, nominate 71 members to the National Assembly
and was invested with executive authority subject
to the advice of
the Cabinet or a Minister. In terms of the Parliament Act No.5 of
1983, which repealed Lesotho Order No.13 of
1973, the King could (on
the advice of the Prime Minister) nominate 8 senators to

10

the
Senate and a maximum of 20 members to the National Assembly, while
executive authority was vested in the King which He had to
exercise
in accordance with the advice of the Prime Minister. Section 41
restored the King's prerogative of mercy. All these provisions
came
to an end in consequence of the 1986 coup d'etat when the Parliament
Act of 1983 was repealed by Lesotho Order, 1986 and Lesotho
(No.2)
Order, 1986.

In terms
of Lesotho Order (No.2), 1986:

1. Executive
   and legislative authority in Lesotho was (by virtue of Section 9 (I)
   vested in the King.

   
   

2. The
   King, acting on the advice of the Chairman of the Military Council,
   was empowered to appoint the other members of the Military
   Council
   (Section 4(2)(b); and

   
   

3. The
   King, acting on the advice of the Military Council, was likewise
   empowered to appoint the other members of the Council of
   Minister;

   
   

4. dBy
   virtue of section 10 the King, acting on the advice of the Military
   Council, could "make laws for the peace, order and
   good
   Government of Lesotho" and "amend or repeal any law so
   made".

   
   

5. The
   King was obliged, in consequence of section 9(2), to exercise his
   functions under the Order or any other law "in accordance
   with
   the advice of the Military Council".

   
   

The
aforegoing were the only powers and authority vested in the King
after the 1986 coup d'etat save that, in terms of the Office
of the
King Order No.51 of 1970, the King was still Head of State, entitled
to a civil list and had the right to be consulted and
kept fully
informed concerning matters of government. No other prerogatives of
the King survived."

He
submitted that following Order 1 of 1970 neither the King nor the
Chiefs

11

"on
his behalf had any place in the legal structure of the State and
could not exercise any executive powers, whether in regard
to the
allocation of land or grant of interest in land, or otherwise.

He
submitted that it follows that insofar as the MRA provided in
sections 6 and 7 thereof that mineral titles are to be granted
by
"the King and the Chiefs on his behalf and that appeals were to
be heard by the King, such provisions were inconsistent
with Order 1
of 1970 which vested all executive power in the Prime Minister and
were accordingly void. Section 24 (6) which refers
to grant by Chief
or King was also void to that extent. It follows, so he submitted,
that sections 6,

7 and 24 (6) of the MRA were not re-enacted, and that the MRA 1970
has to be construed with necessary modifications.

He
submitted that sections 6, 7 and 24 (6) (b) of the MRA should be
construed as follows:

"6. Mineral titles may be granted by Tona-Kholo.

7. (Deleted)

24(6)(b) .........mining leases shall, as far as possible, be in the
form set out in the

12

schedule to this Act and shall be signed by a signing officer
designated in writing by the Minister but subject to paragraph
(d)
and shall be registered by the Registrar.

4. The
   signing officer shall not sign any such document unless he has
   satisfied himself from written evidence that the grant was
   approved
   by Tona-Kholo.

   
   

Mr.
Edeling submitted that the procedures contemplated in sections 6 and
7 of the MRA were therefore inconsistent with the new legal
order.
That Orders 26 and 51 of 1970 recognising the Chiefs and the King,
respectively, did not amend any other laws or "revive
the void
old sections of the 1967 MRA. That, between 1970 and 1986, mineral
titles could only be granted by the Prime Minister.
And that after
the Lekhanya coup in 1986 the MRA was (tacitly) re-amended to provide
that mineral titles might be granted by the
King in accordance with
the advice of the Military Council.

In answer
to the above submissions Mr. Viljoen submitted that it was never

13

the
intention to abolish the Office of King with Order 1 of 1970 and that
did not occur. It does not follow from the fact chat
the King is not
mentioned in Order 1 of 1970 that His office was abolished. It is
true that that is stated to be the case in the
judgment of the Court
of Appeal in Makenete v. Lekhanya and others C. of A (CIV) 17/1990.
But the remarks made in this regard were
essentially obiter to the
decision in that case and, it is submitted, not in accordance with
what actually occurred.

He
submitted that that it was never the intention of Leabua Jonathan to
abolish the Office of King in 1970, is apparent from the
terms of the
Regent (Assumption of Office) Notice No.8 of 1970 issued on the 7th
April, 1970. It reads as follows:

"Whereas
the Constitution of Lesotho as previously in force provided in
Section 34 that the College of Chiefs might at any
time designate, in
accordance with the customary law of Lesotho the person who shall be
Regent, in any of the following circumstances
–

1. when
   the holder of the office of King has not attained the age of
   twenty-one years;
   

   
   

or

2. when
   the holder of that office is unable by reason of absence from
   Lesotho or by reason of infirmity of body or mind to exercise
   the
   functions of that office,

   
   

And
whereas by Government Notice, No.58 of 1967 published in Gazette
No.16 of 26th May, 1967 the College of Chiefs designated Queen

'Mamohato Seeiso to be the Regent in pursuance of the provision of
that section;

14

And
whereas the present holder of the office of King, Moshoeshoe II is to
be absent from Lesotho and will for that reason be unable
to exercise
the functions of that office during the period of that absence;

Now
therefore, I Leabua Jonathan, Tona-Kholo, hereby notify for general
information the assumption of office by Queen 'Mamohato
Seeiso as
Regent from the time of the departure from Lesotho of King Moshoeshoe
II for the duration of that absence."

Mr.
Viljoen submitted that this Notice was not drawn to the attention of
the Court of Appeal considering Makenete's Case (supra).
He submitted
that it removes any vestige of doubt that the King's Office was not,
in a legal or any other sense, abolished by Order
1 of 1970.

It is
important for the Court to consider the effect of The Regent
(Assumption of Office) Notice of 1970. In the Shorter Oxford
English
Dictionary, Regent is defined

as:

"One who is invested with Royal authority by, or on behalf of,
another; especially one appointed to administer a kingdom during
the
minority, absence, or incapacity of the sovereign."

It is
common cause that in the present case King Moshoeshoe II was to be
absent from Lesotho and would for that reason be unable
to exercise
the functions of that office during the period of that absence. The
reason for his inability to exercise the functions
of his office is
stated in the Notice as being his absence

15

from
Lesotho. It is not alleged that the reason is that the office of King
has been abolished. If the monarchy had been abolished
as submitted
by SDM counsel, why was a Regent necessary as the monarchy no longer
existed? There would have been no need to appoint
a Regent because
the monarchy had been abolished.

The
Notice clearly indicates that the monarch was to be absent from
Lesotho for an unspecified period but there was nothing to show
that
the office of King had been abolished. The mere fact that the King
would be absent from Lesotho does not mean that his office
has been
abolished. In the Notice the late King Moshoeshoe II is described as
the present holder of the office of King, (my underlining).
He could
not have been described as the present holder of the office of King
if that office had been abolished by Order 1 of 1970.

Queen
'Mamohato Seeiso was to be Regent for the duration of the absence of
the King from Lesotho. That implies that as soon as the
King returned
He would continue with his duties without any problem. If his office
had been abolished the words "for the duration
of that absence"
would be meaningless. Their actual meaning is that the King retained
His office after Order 1 of 1970 and
was only to be absent from
Lesotho.

16

There is
nothing in Order 1 of 1970 or in the Regent (Assumption of Office)
Notice of 1970 that the King's Civil List was ever suspended
while he
was absent from Lesotho. He obviously continued, to be entitled to
the Civil List. The Government could not continue to
pay a person who
was no longer the King of Lesotho if the monarchy had been abolished.
Section 36(1) of the Constitution of Lesotho
1966 provides that the
King shall have such Civil List as may be provided by Parliament and
that Civil List shall be a charge upon
the Consolidated Fund and
shall not be reduced during the King's continuance in office.

It is for
this reason that I am of the view that King Moshoeshoe II continued
to be entitled to the Civil List because he was never
dethroned nor
did he abdicate.

I again
repeat that if the office of King had been abolished by Order 1 of
1970 the concept of Regency would have disappeared with
the abolition
of the monarchy. The mere fact that Chief Jonathan seized executive
powers of the King by Order 1 of 1970 does not
necessarily mean that
Lesotho became a republic. It remained a kingdom and the Regent
exercised the powers of the King. No one
ever regarded Lesotho as the
Republic of Lesotho during the absence of the King.

The Royal
Palace remained the home of Queen 'Mamohato as the Regent.

17

Her
Magesty has another Palace (home) at Matsieng. If the monarchy had
been

abolished
she would have had no right to live at the Royal Palace in Maseru.
She performed all the ceremonial functions of the King,
such as,
receiving ambassadors accredited to Lesotho by other countries. She
was for all intents and purposes the Head of State
on behalf of her
husband who was absent from Lesotho.

If the
intention of Chief Jonathan was to abolish the monarchy why did he
not say so in no uncertain terms in Order 1 of 1970. In
1990 when the
Military Council removed the late King Moshoeshoe II from the office
of King they clearly said so in section 21 of
the office of King
Order No. 14 of 1990 which reads as follows:

"Notwithstanding the provisions of sections 4,5 and 6, the
person holding the office of King immediately before coming into

operation of this Order shall cease to be King and Head of State on
the coming into operation of this Order."

In the
view that I take Chief Jonathan never intended to dethrone the late
King Moshoeshoe II by Order 1 of 1970 nor did he intent
to abolish
the monarchy. Even at that time when the late King Moshoeshoe II was
dethroned the monarchy was not abolished.

18

I agree
with the submission that the remark made by Ackerman, J.A. in
Makenete's case-supra - was orbiter and not binding on this
Court
whether the Monarchy was abolished by Order 1 of 1970.

It is
common cause that customary law is still part of our law as it was in
1970 when Order 1 of 1970 was passed. This view is supported
by
section 33(1) of the 1966 Constitution of Lesotho which reads as
follows:

"The College of Chiefs may at any time designate, in accordance
with the customary law of Lesotho, the person (or the persons,
in
order of prior right) who are entitled to succeed to the office of
King upon the death or abdication of the holder of that office;
and
if, upon the death or abdication of the holder of the office of King,
there is a person who has previously been designated
in pursuance of
this section and who is capable under the customary law of Lesotho of
succeeding to that office, that person (or,
if there is more than one
such person, that one of them has been designated as having the first
right to succeed to the office)
shall become King."

The
designation of the person who has to be King is made by the College
of Chiefs in accordance with the customary law of Lesotho.
Unless
Order 1 of 1970 specifically referred to the customary law and that
the office of King was abolished even under that law,
then it
continued to exist and the King remained as

19

Head of
State under that law.

Section
32 (2) and (3) of the Constitution of Lesotho 1966 provide that -

2. "The
   King shall do all things that belong to his office in accordance
   with the provisions of this Constitution and of all
   other laws for
   the time being in force. (My underlining)

   
   

3. The
   person holding the office of Paramount Chief (styled Motlotlehi)
   under Basotholand Order 1965 immediately before coming into

   operation of this Constitution is hereby recognised and confirmed as
   the holder of the office of King as from the commencement
   of this
   Constitution."

   
   

The words
underlined above clearly include customary law. The office of
Paramount Chief was a customary position which was recognised
and
confirmed by the Constitution. I entirely agree with what Cullinan,
C.J. said in Mokotso and others v. H.M. King Moshoeshoe
II and others
1989 L.R.C. (Const.) 24 at p.52 when he said:

"In
my view that definition excludes customary law. I am confirmed in
that view by the definition which replace that above,
in s.3 of the
Interpretation Act 1977, wherein 'the customary law of Lesotho and
any other

20

unwritten rule of law' is specifically included. The latter
definition repeats verbatim that contained in s.139 (1) of the
Constitution.
Indeed the term 'existing law' is given a definition
under s.45 (5) of the Lesotho Independence Order 1966, which
specifically
includes 'the customary law of Basutoland and any other
unwritten rule of law'.

As I see
it therefore, s.3 of the Lesotho Order 1970 did not contemplate
customary law. In the absence of any specific reference
thereto, the
reality of the situation was that such law continued to apply, as it
had done from time immemorial. That being the
case the office of King
continued to be recognised at customary law, as did His Majesty King
Moshoeshoe II as King of Lesotho.

The
purpose of the Office of King Order 1970 was no doubt to repeal and
replace the relevant constitutional provisions and indeed
to
introduce additional

21

provisions. In view of the additional provisions previously referred
to, I do not see that the order could have been made retrospective
to
30 January, 1970. In any event, in my judgment the office of King
continued to exist, both under statutory and customary law,
without
break from 4 October 1966. Further, as the office had continued to
exist, the constitutional recognition and confirmation
of the holder
of the office continued also to be valid, again both under statutory
and customary law, which recognition was but
repeated in legal notice
No.8 of 1970. In my judgment therefore, His Majesty King Moshoeshoe
II has continued to hold the office
of King of Lesotho without break
from 4 October 1966.

During
the years 1970 and 1971 a number of orders were made which made
provision in areas previously covered by the Constitution.
In
addition to those already mentioned, the Council of Ministers made
for example the Public Service Order 1970 (No.21), which,

22

inter
alia, established a Public Service Commission, but not a Judicial
Service Commission (and revoked the rules made in 1969
by that
commission), the Lesotho Citizenship Order 1971 (No.16), and the
Ministers of State Order 1971 (No.34), which latter order
provided
that the King, 'acting in accordance with the advice of the Prime
Minister', might appoint and remove ministers of state."

Earlier
in the above judgment at pages 49-50 the learned Chief Justice said:

"One significant aspect of the Lesotho Order 1970, the
Constitution having been suspended, is that it made no provision for

the office of King. Despite this, on 7 April 1970 Tona-Kholo issued a
legal notice (No.8 of 1970) which stated that Her Majesty
Queen
'Mamohato Seeiso, having been designated as Regent on 26 May 1967
under s 34 of the Constitution 'as previously in force',
would assume
the office of Regent during the absence of 'the present holder of the
Office of King,

23

Moshoeshoe II, who is to be absent from Lesotho.

On 8 May
1970 the Court of Appeal and High Court Order 1970 (NO. 17) was made.
It established a Court of Appeal and High Court but
contained the
transitional provision that the corresponding courts in existence on
29 January 1970 should be the Court of Appeal
and High Court for the
purposes of the order. In particular the order provided that judges
would be appointed by the King 'acting
in accordance with the advice
of Tona-Kholo'. On 5 June 1970 the Lesotho Order 1970 was amended (by
Order No 28 of 1970) to provide
that the executive authority of
Lesotho was to be exercised by the Regent; further, a provision was
added whereby laws passed by
the Council of Ministers would require
the assent of the Regent: both functions were to be exercised 'in all
respects in accordance
with the advice of Tona-Kholo'.

On 3 July
there was published the Chieftainship

24

(Amendment)
Order 1970 (no.29): its provisions

referred
a number of times to 'the King', whose approval was required for the
succession to any office of Chief. Some ten months
after the
suspension of the Constitution, on 20 November 1970, the Office of
King Order 1970 (No.51 of 1970) was made by the Council
of Ministers.
It provided that 'there shall be a King of Lesotho who shall be the
Head of State'. In particular, s 2(3) read thus:

'The person who held the office of King under the Lesotho
Independence Order 1966 shall, immediately upon having made and
subscribed
to the oath of office prescribed in the Schedule to this
Order, be recognised and confirmed as the holder of the office of
King
as from the commencement of this Order'."

Several
references to the King in Legal Notice 8 of 1970, Order 29 of 1970

25

and Order
51 of 1970 clearly indicate that Chief Jonathan and legal advisers
never thought that the office of King was abolished
by Order 1 of
1970. If they had thought so they would have never said that certain
functions would be done by the King acting in
accordance with the
advice of Tona-Kholo. Being the people who drafted Order 1 of 1970
they ought to have known better. However
in actual fact they were
sometimes confused and were under the impression that the office of
King had been abolished because it
was not mentioned in Order 1 of
1970. That was incorrect. The appointment of a Regent to perform
certain functions on behalf of
the King is proof that the monarchy
was not abolished. The King was to be absent from Lesotho for an
unspecified period. His Majesty's
absence from Lesotho did not amount
to the abolition of his office or abdication.

Mr.
Edeling submitted that because the executive authority referred to in
the 1966 Constitution, the King was replaced in Order
1 of 1970 by
the Prime Minister, those provisions of the Mineral Rights Act which
stipulated that mineral titles were to be granted
by the King and the
Chiefs on his behalf fell away because:

"The grant of mineral titles is an executive act of government,
which could henceforth therefore only be performed by the
Prime
Minister in whom all executive powers vested under Order 1 of 1970."

26

Mr
Viljoen submitted that the executive functions of government are
carried out by a legion of functionaries, properly authorised
to do
so, - apart from those officials who are in the upper echelons of
government, such as the Prime Minister and his cabinet.
Carrying out
such functions entails a myriad of tasks involved in the
administration of a country. Apart from common sense, so
he
submitted, this follows from the meaning of the word "executive".

Executive - Pertaining to execution: having the function of
executing; esp, as concerned with carrying out the laws, decrees and

judicial sentences: as opposed to "judicial" and
"legislative" B.1 That branch of the government which is
charged with the execution of laws." (Shorter Oxford English
Dictionary)

He
submitted that on the face of it, therefore to suggest that all
executive functions would, after the 1970 coup, be carried out
by the
Prime Minister is absurd. Reference to the 1966 Constitution
illustrates this.

27

Under
Chapter VII headed "The Executive", the following is said
(after vesting authority in the King):

"71 (2) Nothing in this section shall prevent Parliament from
conferring functions on persons or authorities other than the
King."

This was
done by Parliament in a number of Acts. For instance:-

Liquor
(Amendment) Act 1969 – Board

Casino
Act 26/1969 – Board

Industrial
Licencing Act 26/1969 – Board

Deed
Registry Act 1967 - Registrar

Employment
Act 1967 - Labour Officer.

The
following sections of the 1966 Constitution also provide for
executive functionaries S.72 (2), S.73 (1) S.78, S.80, S.81, S.82,

S.83, S.84 and S.87.

It is
important to consider these submissions and to make a decision. It is
correct that the work of executing the laws of a country
is done by
numerous functionaries other than the King, the Prime Minister and
the Cabinet. In fact most of the executive functions
are done by the
executive functionaries who are fairly

28

low in
the hierarchy of the executive. The five acts mentioned above are
only a few examples. There are numerous Acts of Parliament
which give
the executive functions to many other persons and bodies other than
the King, the Prime Minister and the Cabinet. For
instance, the
Criminal Procedure and Evidence Proclamation of 1938 (now Criminal
Procedure and Evidence Act of 1981) which gives
very extensive
executive powers to the Director of Public Prosecutions. In the
exercise of his discretion the Director of Public
Prosecutions is
independent and does not get orders or directives from anybody.

It seems
to me that the executive functions referred to in Order 1 of 1970 was
only in regard to the upper echelons of government
in the execution
of particular acts. Such acts do not include allocation of land or
grants of rights in land which is a function
of the King and Chiefs
under customary law. That these rights are derived from the customary
law and not from their executive functions
is confirmed by section 93
(1)(2) of the 1966 Constitution which reads as follows:

1. "The
   power to allocate land that is vested in the Basotho Nation, to make
   grants of interests or rights in or over such land,
   to revoke or
   derogate from any allocation or grant that has been made or
   otherwise to terminate or restrict any interest or right
   that has
   been granted is vested in the King in trust for the Basotho Nation.

   
   

2. The
   power that is vested in the King by subsection (1)

   
   

29

of this section shall be exercised by him and, on his behalf, by the
Chiefs in accordance with the provisions of this Constitution
and any
other law and the King and the Chiefs shall, in relation to the
exercise of that power, be subject to such duties and have
such
further powers as may be imposed or conferred on them by this
Constitution or any other law.

"Law"
is defined in section 139 of the 1966 Constitution as including "the
customary law of Lesotho and any other
unwritten rule of law".
"Any other law" in subsection (2) refers to customary law.

I have
already said earlier in this judgment that the office of King
survived the 1970 coup. This finding is obviously in direct
conflict
with section 2 of The Office of King 1970 which purported to
recognise and to confirm the late King Moshoeshoe II as the
holder of
the office of King as from the commencement of this Order. (My
underlining). The underlined words can give the impression
that it
was only from the commencement of the Order that the office of King
was created. To recognise is to know again or to identify
as before.
The lawmaker was under the impression that Order 1 of 1970 had
abolished the office of King and that was the reason
why it was felt
that office had to be recognised and be confirmed. It seems to me
that as far as the recognition and confirmation
of the office of King
was concerned was redundant. The Order was probably necessary for
other purposes mentioned from section 3
to the end of the Order.

30

The
Offices of Chief Order 1970 was also enacted under the same wrong
impression that the existence of the chiefs or the chieftainship
Act
1968 was inconsistent with Order 1 of 1970. The Order was given
retrospective effect from the 29th January, 1970 when Order
1 of 1970
was passed. I am of the view that it was also redundant. The
Chieftainship Act of 1968 was not inconsistent with Order
1 of 1970.
Even the amendments which were made to the Chieftainship Act by Order
No.29 of 1972 had nothing to do with the existence
of the institution
of Chieftainship but merely replaced the word "Constitution"
with the words "this Act or any
other law." This confirms
the view I hold that Order 1 of 1970 never abolished the office of
chief.

Mr
Edeling submitted that the fundamental flaw in the LHDA's argument
that Chiefs Order 26/70 reinstated the earlier mining grant

procedure, is that whilst a revolution can abolish a law, such a law
can only be revived or re-enacted in express terms by a clear

legislative act. He submitted that it admits of no doubt that after
the Jonathan coup but prior to Order 26/70, there were no chiefs

recognised by law (may be as opposed to customary law) and they had
no executive powers, and they had no role to play in the grant
of
mining leases.

I agree
with this submission as regards the effect of the revolution on the

31

laws
that are inconsistent with the new laws brought by the revolution. Mr
Edeling has conceded that it may be that under customary
law there
were still chiefs. That is correct. I have already stated above that
Order 1 of 1970 did not deprive the chiefs of their
powers to
allocate land. It is not correct that because Order 1 of 1970 gave
executive powers to the Prime Minister it meant that
all executive
powers including power to allocate land and rights in land were to be
exercised by the Prime Minister only. There
are many other
functionaries at the lower end of the hierarchy. Chiefs are such
functionaries and their powers were not affected
by Order 1 of 1970.

Mr.
Edeling submitted that it has long been recognised in Lesotho that
the Government is bound by its contracts, if they are signed
by a
Minister or a person authorised by him (See Government Proceedings
and Contracts Act No.4 of 1965 -Section 10).

He
submitted that this Act recognises the validity of government
contracts and provides that they will be enforceable if properly

signed, regardless of whether the prior procedures were complied
with. I am not happy with the underlined words starting from the
word
"regardless". Section 10 of the Act reads as follows:

32

"A contract or agreement other than a contract or agreement
entered into by virtue of the provisions of section eight and
nine
purporting to be made on behalf of Her Majesty in Her Government of
Basutoland or the Basutoland Government shall be held
to be a
contract or agreement made by and on behalf of Her Majesty in Her
Government of Basutoland if signed by a Minister of Motlotlehi's

Government or by an officer authorised by such Minister, and unless
so signed shall be of no effect."

In my
view there is nothing, in section 10 to support the submission that
the contract shall be enforceable if properly signed regardless
of
whether the prior procedures were complied with. What is said is that
once the contract is signed by the Minister or a person
authorised by
him, it shall be held to be a contract or agreement made by on behalf
of His Majesty's Government. The signature
of the Minister or of a
person authorised by him proves that it is a contract made on behalf
of His Majesty's Government. That
does not mean that such a contract
cannot be challenged in a court of law to show that it is invalid for
any reason. Section 10
of the Act can be a defence only in a case
where there is a dispute as to whether that is a contract on behalf
of His Majesty.
The applicant has to show that it is signed by the
Minister or a person authorised by him. It will be held that it is a
contract
made on behalf of His Majesty's Government. That section has
nothing to do with "procedural irrelevance."

33

Section
30 of the Interpretation Act of 1977 reads as follows:

"Where
an Act confers powers upon a person to –

1. make
   any subsidiary legislation; or

   
   

2. exercise
   any power,

   
   

and the
Act conferring the power prescribes conditions subject to the
observance, performance or existence of which the power conferred
may
be exercised, those conditions shall be deemed to have been fulfilled
if in the subsidiary legislation or instrument exercising
the power
there is a statement to the effect that the subsidiary legislation is
made, or the power exercised, subject to the conditions
prescribed by
the Act."

In that
section the words "shall be deemed" are used. In my view
this a rebuttable presumption. The thing that is deemed
can be
rebutted. In the Canadian Case of Credit Foncier Franco - Canadien v.
Bennett and A.G. (B.C) (1963) 43 W.W.R. 545 Sheppard,
J.A. said at p.
547

"The word 'deemed' is capable of meaning rebuttably presumed;
that is, presumed until the contrary is proved".

It is
therefore not correct to say that once it is proved that the contract
has

34

been
properly signed by a Minister or a person authorised by him, the
procedures prescribed by law become irrelevant whether they
have been
followed or not. A person who is directly affected by such a contract
can challenge the validity of such a contract in
a court of law to
show that there has been a non-compliance with the prescribed
procedures especially in a matter in which such
procedures appear to
be of vital importance.

I agree
with the submission that the wording of the provisions of section 6
of the MRA where they require that the Mining Board
recommend and
that the chiefs after consultation, grant a lease are peremptory.
That follows from the opening words of subsection
6(1) which provide
that a mineral title may be granted "in the manner prescribed in
this Act, but not otherwise," the
word "shall" is
repeatedly used in outlining the procedures to be followed.

In
Messenger of the Magistrate's Court, Durban v. Pillay 1952(3) S.A.
678 at p. 683 C-D Van den Heever said:

"In the first place the sub-rule with which we are concerned is
couched in peremptory terms: the messenger "shall cause
the sale
to be advertised...". The Afrikaans version has the categorical
imperative "moet". If a statutory command
is couched in
such peremptory terms it is a strong indication, in the

35

absence of considerations pointing to another conclusion, that the
issuer of the command intended disobedience to be visited with

nullity."

In Sehume
v. Atteridgeville Town Council 1989(1) S.A. 721(T) at p. 724 E - H
Stafford, J. said:

"There is no doubt that the peremptory language used in the
regulations mean that, where a local authority, as in this case,
is
empowered to make by-laws which can encroach upon the rights of
persons or affect their pockets, the formalities to bring such
laws
must be scrupulously observed. I refer to Maxwell The Intepretation
of Statutes.

'Where powers, rights or amenities are granted with the direction
that certain regulations, formalities or conditions shall be
complied
with, it seems neither unjust nor inconvenient to exact a rigorous
observance of them as essential to the acquisition
of the right or
authority conferred and it is therefore probable that such was the
intention of the Legislature.'

This passage has been quoted with approval in many judgments over the
years. There is no point in mentioning all these judgments,
save that
of Van den Heever JA in Messenger of the Magistrate's Court, Durban
v. Pillay 1952 (3) S.A. 678 (A)( at 683.

I am in agreement with what Roux J said in an unreported judgment in
the Transvaal Provincial Division, Marcus v. Town Council
of
Mamelodi, case No. 12722/86, dated 24 February 1987:

36

'If a
statute is construed as peremptory, non-compliance with its
prescriptions by a subordinate law-maker cannot bring about the
legal
consequences required. It results in a nullity. I have no doubt that
the regulations must be held to be peremptory with all
the
consequences which follow upon such an interpretation."

In Sutter
v. Scheepers 1932 A.D. 165 at pp 173 -174 Wessels, J.A. said"

"The
word "shall" when used in a statute is rather to be
construed as peremptory than as directory unless there are
other
circumstances which negative this construction - Standard Bank Ltd v.
van Rhyn (1925, A.D. 266).

1. If a
   provision is couched in a negative form it is to be regarded as a
   peremptory rather than as a directory mandate. To say that
   no power
   of attorney shall be accepted by the Deeds Office unless it complied
   with certain conditions rather discloses an intention
   to make the
   conditions peremptory than directory: though even such language is
   not conclusive.

   
   

2. If a
   provision is couched in positive language and there is no sanction
   added in case the requisites are not carried out, then
   the
   presumption is in favour of an intention to make the provision only
   directory. Thus is Cole v. Greene (L.J.C.P.., vol. 13
   at p. 32)
   Tindall, C.J., approving of a decision of Lord Tenterden and dealing
   with this same question as to when "shall"
   is to be
   interpreted as peremptory and when as directory, says: "It may
   be observed here as it was by Lord Tenterden....
   in the case of The
   King v. Justices of Leicester that

   
   

37

the
words are in the affirmative only and that there are no negative
words; nor are the words so stringent as in those of the Marriage
Act
4 Geo. IV c. 76, s. 16 whereby it was enacted 'that the father, if
living, of any party under twenty-one years of age (such
party not
being a widower or widow), or if the father shall be dead, the
guardian or guardians, etc., shall have authority to give
consent to
the marriage of such party; and such consent is hereby required for
the marriage of such party so under age, unless
there shall be no
person authorised to give such consent:' and yet, in The King v.
Birmingham it was held that those words are
directory only. Lord
Tenterden, in giving judgment, says: 'The language of this section is
merely to require consent; it does not
proceed to make the marriage
void if solemnised without consent.' So here, the Act says, the
contract shall be signed by the commissioners,
or three of them, or
by their clerk; it does not say it shall be void unless so signed."

3. If,
   when we consider the scope and objects of a provision we find that
   its terms would, if strictly carried out, lead to injustice
   and even
   fraud, and if there is no explicit statement that the act is to be
   void if the conditions are not complied with, or
   if no sanction is
   added, then the presumption is rather in favour of the provision
   being directory.

   
   

4. The
   history of the legislation will also afford a clue in some cases."

   
   

38

It is
correct that section 6 (4) of the MRA is couched in positive language
and there is no sanction added in case of non- compliance
with the
provisions of the subsection than there is a presumption in favour of
an intention to make the provisions only directory.
This is what was
held in Sutter's Case (supra). However, subsection (4) must be read
with subsection (1) of section 6 where the
words "and in the
manner prescribed in this Act, but not otherwise." (My
underlining). The underlined words leave no
doubt in mind that the
intention is to make the provisions of subsection (4) peremptory. The
words "but not otherwise"
apply to the whole Act including
subsection (4).

I have
come to the conclusion that the provisions of section 6 of MRA are
mandatory and the "grant of the "lease"
which does not
conform to the requirements of that subsection is no grant at all. It
is in fact a nullity, and no duty to act can
flow from such a
nullity." See Ondombo Beleggings v. Minister of Mineral and
Energy Affairs 1991 (4) S.A. 718 (A) at p. 725.

It is
common cause that even the then Minister of Water, Energy and Mining
was of the opinion that consultation with Principal or
Ward Chief
within whose jurisdiction the mining area falls is mandatory. In his
memorandum dated January 27, 1988 and another memorandum
dated April
25, 1988 he stated in

39
paragraph 5 that:

"The Mining Board may wish to note that, in terms of Section 6
of the Mining Rights Act No.43 of 1967, His Majesty the King
and the
Chief on His behalf may, in accordance with the advice of the Mining
Board, grant mineral titles. Therefore, consultations
with Principal
chiefs is mandatory. (My underlining)

In the
present case it is subsection (4) of Section 6 of the MRA whose
provisions are mandatory. What must now follow is the analysis
of the
evidence to find out if any consultations with the Principal Chiefs
of Leribe and Butha Buthe did take place or not before
the lease in
question was granted. The first witness called by LHDA is
Chieftainess 'Mamolapo Motsoene who has been the acting
Principal
Chief of Leribe since the beginning of 1986. She testified that
during the period between 5th May and 8th August 1988
she was away
from her area because she was attending a course in Israel. Her
evidence was that she never approved the granting
of a lease to SDM
at Rampai area. She did not know anything about that lease until the
5th February, 1995. She did not ever receive
a recommendation from
the Mining Board that a lease be granted in the Rampai area.

Two
secretaries of Chieftainess Mamolapo Motsoene, namely Mrs

40

Makenete
and Mrs Matsie testified that during the absence of Chieftainess
Motsoene no recommendation from the Mining Board was
ever received by
them and that the late chief who was acting while the chieftainess
was away never approved the granting of a lease
at Rampai area.

Chief
Kuni Hlasoa Mopeli has been the Principal Chief of Butha Buthe since
early 1986. In his evidence on affidavit he states that
he never
approved the granting of a lease at Rampai area.

It is a
fact that the evidence of the above witnesses on behalf of LHDA has
not been controverted by any evidence on behalf of SDM.
Such evidence
would normally be accepted by the court without much ado had it not
been for the submissions by Mr. Edeling as to
why such evidence
should not be accepted as true. Before dealing with such evidence I
must mention that General Lekhanya and Mr.
Makhakhe stated in
cross-examination that they could not deny that the chiefs were not
consulted in terms of section 6 of the MRA.

Mr.
Edeling submitted that there are a number of unsatisfactory features,
which raise serious questions as to the credibility of
LHDA's case in
this regard. The first of such features is that most of LHDA
witnesses, including chiefs, falsely

41

denied
prior knowledge of the SDM lease and dishonestly tried to distance

41

denied
prior knowledge of the SDM lease and dishonestly Cried to distance

themselves
from it. In this regard he made reference to the investigation which
was conducted by LHCA in 1991 into the question
of whether there was
non-compliance with the prescribed procedures. He submitted that Mr.
Putsoane testified at p.480 of the record
that as part of such
investigations, LHDA consulted with the chiefs. He submitted that his
evidence was true as it accords with
every probability, and there is
much corroboration for it.

I am
suprised that Mr. Edeling seems to have forgotten what Mr. Putsoane
said in cross-examination by him. (Mr. Edeling). He said:

"Why
do you say LHDA consulted with chiefs? Is it because you know that
that is so, and you remember it or is it just an Inference
you are
making? — It is

It is an
inference? – Yes

Would it
then be fair to say that you really have no personal knowledge of
what LHDA actually did in order to investigate the lease?
- You mean
as a person

Whether I
was the one that A, B, C, D?

No, I am
saying you as a person have got no personal knowledge of what was
done by the LHDA to investigate the leases? — You
are right.

Is there
any record or report about such investigations that you have seen? -I
am not aware of the report but I think this case
is part and parcel
of that.

42

Is it
then correct that when Mr. Sole made that affidavit, which you have
just referred to at page 463, LHDA's position was we intend
to
investigate it, after that they did but you do not know the details
of the investigation? —Right.

You agree
with my summary?----I do."

Mr.
Putsoane's answers put it beyond any reasonable doubt that he had no
personal knowledge of the details of the investigations
and that he
was just drawing an inference based on the facts (proved facts) which
he did not disclose. This inference is altogether
unjustified and
cannot be used to rebut the oral evidence of witnesses who were
cross-examined at length and withstood such cross-examination
well.

Mr.
Makhakhe's evidence does not carry SDM's case any further on this
point. He is alleged to have testified that he was consulted
by the
legal representatives of GOL and LHDA during late 1991, specifically
on the question of the procedures leading to the grant
of the SDM
leases. Mr. Edeling submitted that that evidence was not challenged
and corroborates Putsoane's evidence that LHDA indeed
conducted such
investigations at that time.

It is
true that the intention to make such investigations by LHDA was there
but there is no conclusive evidence that it took place
at that time.
It seems to me

43

that not
enough evidence has been placed before the Court to enable it to make
a finding that the chiefs have given false or wrong
evidence.

Mr.
Edeling submitted that there are suggestions in the evidence of
chiefs that it is their perception that if SDM should win, and
get
compensation, there will be less compensation for them and their
people. That although that is certainly not enough for a finding
of
corruption, the motivation would be the same. Money motivates many
people, so he submitted, and if for purposes of this action
the
chiefs were brought under the impression that SDM success would have
adverse economic consequences for the chiefs and their
people, that
would provide a further motive to give false evidence.

In my
view the above submission is nothing but speculation based on the
assumption that the chiefs were given that impression by
somebody or
some people unknown. I do not accept that speculation. The economic
value to Lesotho by selling water to South Africa
is something that
was explained to this nation and debated in political forums for many
years starting from as early as the 1950's.
People, including chiefs,
have formed their own opinions about its economic value to this
country. It is unfair to say that the
chiefs are motivated by the
economic consequences they are going to enjoy to give false evidence.
All the chiefs gave

44

their
evidence in a fair and straightforward manner which gave me the
impression

that they
were telling the truth.

Mr.
Edeling submitted that a further cloud of suspicion arises from the
content of trial Exhibit K1, being the affidavit of the
Government
Secretary stating that the government files are missing. He submitted
further that the Court has already formed strong
prima facie views in
that regard. At record p. 350/5-11, the Court held that it is unusual
to allege that government files are
lost, that it is no doubt
corruption at the highest point, that the learned Chief Justice does
not know who is practising that
corruption, but does know that –

"there is somebody who is playing tricks and for what purpose I
have no idea."

He
submitted that despite these strong sentiments, neither LHDA nor GOL
places any evidence before the court to dispel those prima
facie
views, which at the close of the trial therefore become much
stronger. He concludes by saying, in other words, the Court
knows
that such files existed, and what those files contained. The most
natural inference is that those files also contained the
written
responses of the chiefs in regard to such recommendations.

45

I agree
that I did express those strong sentiments about the alleged
disappearance of government files from government offices.
I was very
angry about such an occurrence and had no doubt that it was
corruption practised by some people or some government officials.
I
had no idea about their identity. However I must point out that those
remarks I made will not influence me one way or the other
in favour
of any of the parties before me because I have no idea who "stole"
those files. I have no idea whose case the
disappearance of those
files is going to benefit. If their contents included the
recommendations of the Mining Board to the Principal
chiefs and the
approval of such Principal chiefs that would benefit SDM's case. But
if there were no such recommendations and approvals
that would
benefit LHDA's case.

I do not
agree with the submission that the Court knows "what those files
contained." I have no idea what those files
contained and no
reliable evidence was led by any party as to the contents of those
files. I do not think that Mr. Tsekoa, the
Government Secretary, has
given evidence on which I can rely. In paragraph 9 of his affidavit
(Exhibit Kl)he states

"Among those files which are no longer available are those files
containing recommendations by the Mining

46

Board to Principal Chiefs regarding mineral titles to be considered
by those Chiefs regarding the Mining Act 1967." (My underlining)

The
Government Secretary does not disclose the source of his knowledge.
Who told him what the contents of those files were? If he
has
personal knowledge, did he see the contents of those files and what
was he looking for when he came across such information,
was it in
the normal course of performing his duties? These explanations are
necessary if I am to rely on the bold statement he
has made in his
affidavit.

Furthermore
he contradicts himself because in paragraph 10 of the same affidavit
he alleges

"I wish to state that no files relating to the matter in issue
in this application is in my possession or control and consequently

am unable to produce them. In spite of my diligent search I am unable
to say whether those documents existed or not." (My
underlining)

It seems
to me that the Government Secretary is contradicting himself

47

because
in paragraph 9 he alleges that amongst the files which are missing
are those containing recommendations by the Mining Board
to the
Principal Chiefs. However in paragraph 10 he alleges that he is
unable to say whether those documents existed or not. It
is obvious
that he never saw those recommendations by the Mining Board to the
Principal Chiefs. It is also clear that when he became
Government
Secretary in 1996 the relevant files had long been removed from
government offices in March, 1993.

I reject
his evidence as being of no assistance to the Court except the fact
that the files are no longer available.

TUROU AND
RULE

Mr
Edeling submitted that the Turguand Rule, which is not based on
estoppel, applies to public bodies and in suitable cases the
law
deems internal procedures to have been met. He further submitted that
the Turquand Rule, which is not based on estoppel, also
applied to
public bodies which may be estopped from raising a legal defect as a
ground for invalidity where such defect is an internal
irregularity.

48

In the
present case this clearly means that if the GOL were to raise the
legal defect that the chiefs were not consulted in terms
of section 6
of the MRA, as a ground for invalidity, they would be estopped where
such a defect is an internal irregularity. The
Turquand rule may
operate against the GOL and not again LHDA who are a third party.

In
Henochsberg on the Companies Act, Fourth Edition by Meskin, Vol. 1 at
pp 105-106 the learned author defined Turquand rule in
the following
words:

1. "The
   Turquand rule is that while a bona fide third party who contracts
   with a company is presumed to be aware of any requirement
   which in
   terms of its public documents must be observed "internally",
   i.e. as between the company and its members,
   in order that the
   company should be effectively bound by the contract, he is neither
   presumed to know, nor bound, for the purpose
   of holding the company
   to the contract, to ascertain, whether it has in fact been observed.
   In this context, the third party
   is not bona fide if he in fact
   knows that the requirement has not been observe (Mine Workers' case
   supra at 845-846; cf Burstein
   v Yale 1958 (1) SA 768 (W) at

   
   

49

771-772)
or if he knows facts which as a reasonable man should put him on
enquiry with regard to whether or not it has been (AL
Underwood Ltd
v. Bank of Liverpool [1927] 1 KB 775 (CA) at 787-789; Honghton &
Co v. Nothard Lowe & Wills Ltd [1921] 1
KB 246 (CA) at 261-262
affirmed [1928] AC 1 (HL)). If eg he knows that under the articles
the transaction must be approved by a
special resolution, he should
inspect the records of the Registrar since if the resolution has been
adopted it will be on record
with the latter {Irvine v. The Union
Bank of Australia (1877) 2 App Cas 366 (PC) at 379)."

LHDA is a
third party in the present case. There is nothing to show that it had
knowledge that the requirement had not been observed.
In other words
there is no evidence that LHDA is not bona fide. It was only much
later when it launched some investigations that
it found that the
requirements of section 6 of the MRA had not been observed.

Mr.
Viljoen submitted that whatever the ambit of the rule, it cannot
apply to a third party and an entirely separate entity (LHDA)
from
the "company" (here,

50

on SDM's
argument, GOL). In other words, Turquand rule has no bearing on a
situation in which LHDA relies on non-compliance with
statutory
provisions by GOL , order to set aside what purported to be done. The
extension of the rule to public bodies relied upon
by SDM can, at
best for it, only prevent GOL itself from relying on non-compliance
with its own procedures to set aside SDM's lease.

I agree
with the above submission.

LHDA
called, as witnesses, three former Ministers in the 1986 Military
Government, namely Mr. Sello, Dr. Makenete and Mr. Khaketla.
Their
evidence was that without the Council of Minister's recommendations
the Military Council would not approve any application
for a mining
lease. They further testified that no recommendation or approval of
the Rampai mining lease was ever given by the
Council of Ministers.
As former members of that Council their evidence must be given a very
thorough consideration because they
must know what happened in the
meetings of that Council.

The crux
of their evidence was that they believed that to grant a mining lease
for a period often to fifteen years in the catchment
area of Katse
dam would compromise the Lesotho Highlands Water Project which was of
prime importance

51

to the
country.

SDM's own
witness, Mr. Makhakhe, agreed that the attitude which the three
former Ministers displayed was reasonable:

" They said, if we had known that the lease was being suggested
for fifteen years in an area that was to be flooded or parts
of which
was to be flooded we would never have agreed to that and we do not
think any of our colleagues in the Council of Ministers
would either.
Now my question to you simply is, does that seem to you a reasonable
reaction, a responsible reaction by those Ministers
or do you think
that is unreasonable, they are not thinking the thing through
properly?.... Well, I think I would have thought
that this was a
reasonable reaction."

In his
evidence Mr. Labuschagne also said that he did not find it
understandable that the Government of Lesotho would grant a mining

lease which covered the catchment area of the Katse dam.

Mr.
Viljoen submitted that the probabilities heavily favour the evidence
given by Messrs. Sello, Khaketla and Dr. Makenete. Nor
was it
suggested in their

52

cross-examination that they had any reason whatsoever to dissimulate
in this regard (or even, that they were part of some conspiracy).

On the
other hand Mr. Edeling submitted that bearing in mind the broad
policy objectives of the legislation namely that the leaders
in
Government should have an input, it could be argued in the
alternative that even if the Council of Ministers passed no
resolution,
they were certainly consulted and had every opportunity
of airing their views, which according to the evidence of LHDA's own
witnesses,
in fact happened.

He
further submitted that although Mr. Sello denied that the SDM leases
were before them, the other witnesses were prepared to remember
and
testify that the question of SDM's leases was placed before the
Ministers, that certain reservations were expressed and that
the
matter was referred back to address such reservations.

In terms
of section 6 (1), (2) and (3) of the MRA it is not enough for the
Mining Board to be consulted about the application for
grant of
mining rights. They are expected to make recommendations concerning
every such applications and submit the recommendations
to the
Principal Chief of the district in which the

53

mining
area is located. The most important input by the Mining Board is to
make recommendations in writing which must be submitted
to the
Principal Chief in whose district the mining area falls. Consultation
alone without a recommendation in terms of section
6 (1), (2) and (3)
of the MRA is not a proper compliance with the provisions of the law.

We now
know that according to the evidence of the Principal Chiefs of Butha
Buthe and Leribe no recommendations by the Mining Board
were ever
submitted to them and that they never approved the grant of mining
rights to SDM.

It is
altogether inconceivable that the Mining Board would make a
recommendation that SDM's application for a grant of a mining
lease
should be granted for a period of up to fifteen years despite the
fact that the Rampai area was just about to be flooded.
The
probabilities are in favour of the LHDA's evidence. I have not lost
sight of the fact that it was hinted that the diamonds
might be
removed before the flooding. If that was the case why grant a mining
lease for a very long period of between ten and fifteen
years? Again
this is improbable. The Mining Board and the Principal Chiefs as well
as local chiefs would not prejudice the gigantic
water project that
was to bring about great economic benefits to this country.

54

Mr.
Edeling submitted that the evidence shows that it was the general
view, both in government and among the chiefs and governmental

advisors, that mining rights are granted by the King acting on the
advice of the Military Council without any necessary role being

played by the Chiefs. That might have been the general view but
section 6 (1), (2) and (3) of the MRA is very clear that the
recommendation
by the Mining Board ought to go to the Principal Chief
who shall consult the local chiefs under whose area the application
falls
and if the chiefs approve the Principal Chief shall grant the
application. The grant or approval shall be referred back to the
Mining Board and the lease documents shall be prepared and signed by
the authorities. Any practice which was inconsistent with the

provisions of section 6 of the MRA renders such a lease invalid.

It is
true that concurrences were made by certain Ministries including the
Ministry of Law which was signed by the Honourable Attorney-General,

Mr. K.A. Maope (as he then was). The problem I have with the SDM's
case is that Mr. Sello who was the Minister of Law at the relevant

time denies that he ever concurred. He did not sign the concurrence,
it was prepared and signed by Mr. Maope. It would have been
very
convenient to have called Mr. Maope as a witness to contradict Mr.
Sello and to explain under what circumstances the concurrence
was
made. The Court would be in a position to evaluate their

55

evidence.

CONSPIRACY

It was
submitted on behalf of SDM that there was conspiracy to deprive SDM
of its lawful rights. It was submitted that the parties
involved in
the conspiracy were GOL, South African Government and LHDA. It was
the duty of SDM to prove this allegation on a balance
of
probabilities especially against LHDA which is trying to set aside
the SDM's Rampai lease on the ground that certain procedures

prescribed by law were not followed when the application for the
lease was granted. I have already found that there is overwhelming

evidence that the chiefs under whose jurisdiction the Rampai area
falls were not consulted and that the recommendation by the Mining

Board was never submitted to them.

SDM did
not lead any evidence to show that the chiefs were in fact consulted.
Mr. Makhakhe's evidence did not establish that fact.
His evidence was
to the effect that the Minister of Water and Energy repeatedly
emphasised that consultation with the chiefs was
absolutely
necessary. He apparently assumed that because there was a concurrence
by the Minister of the Interior consultation with
the Chiefs must
have taken place. Unfortunately we now know through the evidence of
such chiefs that there was no consultation.

56

General
Lekhanya and Mr. Makhakhe who were star witnesses of SDM denied when
they were cross-examined by counsel on behalf of LHDA
that there was
any conspiracy to deprive SDM of its lawful rights. Mr. Putsoane and
Mr. Labuschagne also denied any conspiracy.

The
following is what General Lekhanya said under cross-examination: Mr.
Viljoen: "Let us turn now to the topic that has been
raised here
by our learned friend, Mr. Edeling, in an address in which he set out
the case to be made on behalf of Swissbourgh
(in) cross-examination,
and that is that there was a conspiracy, that there is a conspiracy
between the governments of Lesotho
and South Africa against
Swissbourgh, and that in fact LHDA, and as I understand the argument,
the government of Lesotho are really
puppets of the South African
government. Did you ever encounter anything to convince you that the
government of Lesotho was a puppet
of the South African government in
your time in power? - -I did not believe our government to be a
puppet of South Africa about
all the pressure that at times were
exerted on the government of Lesotho. Were you not acting, General,
as a puppet of the South
African

57

Government at that time? - - No, I was not. Would you be surprised if
anyone suggested that you were? - -I would not be surprised,
there
were a lot of fingers being pointed at our Military Government that
even the coup was as a result of pressure from South
Africa which was
not.

Would
that be an untrue and a reckless allegation about you? - -I think it
would be."

Mr.
Viljoen: I want to know from you.......did you ever experience any

dishonesty, any under-handedness when you were chairman of

LHDA in the dealings of the South African Government - -

No,.... (inaudible)

Or of the
Lesotho Government? - - No.

Or of
LHDA?--No."

Mr.
Labuschagne said:

Mr. Viljoen: "Now I have summarised what is at that passage.
But these are the questions I want to ask you. Is, to your knowledge,

South Africa the real person or the real body before this Court?
--No.

58

Is LHDA a
puppet of South Africa? - - No.

My
question is, is the gist of that statement: "You [Putsoane] are
not the real person before the Court, the South Africans
are running
it".......is what is said there correct? - - No, it is not".

I want to
ask you, have you ever been part of the secret plan, illegally and
dishonestly, - that is what was put, - to deprive SDM
of its rights
here in Lesotho unlawfully? - - No, I have not.

Do you
know of any such plan? - -I do not

Have you
had any part in presenting evidence to mislead this

Court? -
- No."

All three
witnesses were SDM's witnesses but they had no knowledge of

such
conspiracy.

ABUSE OF
STATE POWER

Mr.
Edeling submitted that in the main application in case 394/91, SDM

59

established
a strong case of abuse of government power in purporting to cancel
SDM's mining leases for the ulterior motive of assisting
LHDA and the
two (governments to avoid the consequences of their unlawful
activities, and to evade payment of compensation.

It is
common cause that both the High Court and the Court of Appeal came to
the conclusion that the revocation of Specified Mining
Leases Order
(No.7 of 1992) is declared to be void and of no force or effect in
law.

Paragraphs
1-5 of the Order of the Court of Appeal read as follows:

1. The
   revocation of Specified Mining Leases Order (No.7 of 1992) is
   declared to be void of no force or effect in law.

   
   

2. The
   first and second respondents are directed to ensure that the
   proceedings under Civil Application No.198 of 1991 and Civil

   Application No. 206 of 1991 are properly enrolled forthwith and
   expeditiously prosecuted in terms of the relevant Rules of Court.

   
   

3. All
   the respondents are directed to enrol the proceedings under Civil
   Application No. 394 of 1991 forthwith and expeditiously
   to prosecute
   the said application in terms of the Rules of Court.

   
   

4. Should
   the respondents referred to in paragraphs 2 and 3 fail to enrol and
   prosecute the applications referred to in these sub-paragraphs
   as
   directed herein, the relevant respondents in the said applications
   shall be so entitled (after notice to the relevant applicants)
   to
   enrol the said applications for determination by the Court.

   
   

60

5. During
   the period commencing from the date of this order and expiring at
   midnight on the 31st of July 1995 the appellants are
   interdicted and
   restrained from interfering with, obstructing or impeding any agent,
   employee or expert engaged by or in the
   employment of the
   respondents (and who is lawfully entitled to be in Lesotho).

   
   

1. from
   conducting any tests or investigations in the areas identified in
   Schedule A hereto, for the bona fide purposes of estimating
   and
   quantifying any damages suffered by the respondents or any of the,
   in consequence of any unlawful acts perpetrated by or
   on behalf of
   or at the instance of the appellants.

   
   

2. from
   using equipment, machinery or materials to conduct such tests or
   investigations, in the said areas, whether such equipment,

   machinery, or materials already exist within the areas are covered
   by Schedule A or is introduced for that purpose after the
   date of
   this Order."

   
   

The
revocation of Specified Mining Leases Order (No.7 of 1992) was
declared to be void and of no force or effect in law. The declaration

has nothing to do with the present proceedings which are based on an
entirely different cause of action. After some investigations
LHDA
found that the procedures prescribed by section 6 of the MRA had not
been complied with when the mining application by SDM
regarding
Rampai area was considered and finally granted. It has been submitted
on behalf of LHDA that such non-compliance renders
the lease in
question null and void. This cause of action cannot be regarded as
abuse of power

61 by the
LHDA, which is admittedly a public body. It has nothing to do with

whatever
previous abuse of power was used by GOL by passing statutes which
allegedly attempted to assist the LHDA not to comply
with its
obligations. It is a cause of action based on a point of law. There
is no suggestion that section 6 of the MRA was passed
with any
ulterior motive involved. It was passed several years before the
present litigation was even contemplated.

The case
of abuse of State power is altogether irrelevant in the present
proceedings and ought not to have been raised at all.

COSTS

It is
common cause that when this case started the parties were in
agreement that it would occupy about five court days. In fact
the
case ran for a total of fifty-nine days. From this total must be
deducted 9 days in respect of which the court has already
granted
costs orders. That leaves 50 days.

By far
the greater part of this period of 50 court days was occupied with
the conspiracy issue. The same can be said of the thousands
of pages
of documents with which the court was flooded by SDM.

62

The
following witnesses only were relevant to the issue raised in the
counter -application.

1. Mr.
   Putsoane who was called simply in order to define the area of the
   Rampai lease to show that it fell within both the Butha
   Buthe and
   Leribe districts. That evidence, including cross-examination, could
   not have taken more than half a day. The rest of
   Putsoane's evidence
   (which occupied a total of 8 days) was taken up with the allegations
   of conspiracy.

   
   

2. The
   Chiefs and members of Chieftainess Motsoene's staff. They gave
   evidence on 24 and 25 September, 1996 and 12 November, 1996
   for 3
   days.

   
   

3. The
   three members of the Council of Ministers. They gave evidence on 12
   to 14 November, 1996 for 3 days.

   
   

4. General
   Lekhanya - He gave evidence for 8 days. His evidence is allowed
   under the issue raised in the counter - application.

   
   

Some time
was also allocated to Mr. Makhakhe.

63

Mr.
Viljoen submitted that making liberal provision for the time spent on
the issue which should have occupied the Court time (namely
whether
the Rampai lease has granted with the approval of the Chiefs and the
Council of Ministers) fourteen days were spent on
that topic, leaving
36 days which were devoted to the conspiracy. In respect of this
Court time, whatever the outcome of the Court's
decision on the legal
argument addressed above and the question as to whether the chiefs
and the Council of Ministers gave their
approval to the registration
of the Rampai lease, LHDA is entitled to costs, including the cost of
two counsel.

He
submitted that as to the scale of such costs order it should be on
the scale as between attorney and own client for the following

reasons; As has been pointed out in the section above dealing with
allegations of conspiracy, no evidence whatever was presented
to
justify conspiracy. It follows that it was reprehensible to make the
far-reaching and defamatory statements mentioned above,
in that
regard. Such behaviour is sufficient to justify a punitive costs
order such as that now sought.

He
referred to the following authorities:

"An
order is asked for that he pays the costs as between attorney and

64

client.
Now sometimes such an order is given because of something in the
conduct of a party which the Court considers be punished,
malice,
misleading the Court and things like that, but I think the order may
also be granted without any reflection upon the party
where the
proceedings are vexatious, and by vexatious I mean where they have
the effect of being vexatious, although the intent
may not have been
that they should be vexatious. There are people who enter into
litigation with the most upright purpose and a
most firm belief in
the justice of their cause, and yet whose proceedings may be regarded
as vexatious when they put the other
side to unnecessary trouble and
expense which the other side ought not to bear. That I think is the
position in the present case."
In re: Alluvial Creek Ltd 1929
CPD 532 at 535 "In my opinion these attacks made upon Jordaan,
on the evidence placed before
the Court in Mr. Eiser's affidavit, are
scurrilous. It is unjustified by anything stated or done by Mr.
Jordaan. If attorneys,
as officers of the Court, behave in such a
fashion towards each other such conduct can only reflect upon the
dignity of the whole
legal profession. Furthermore, such conduct
brings not only the profession into contempt but indeed the whole
system of justice
and the Court.

65

In my
view it is at least highly arguable that Mr. Eiser, part from having
acted unfairly and in an excessive fashion both the plaintiff
and his
attorney, has committed contempt of court. He is fortunate in my view
that Mr Selvan, for the reason I have mentioned,
withdrew the
application for costs de bonis propriis. In my view, however, having
regard to the seriousness of the attack which
Mr Eiser made upon the
plaintiff, who is a professional man, and against Mr Jordaan, an
officer of this court, it is proper that,
as a mark of the court's
extreme displeasure at this conduct, an award of an attorney and
client costs should be made. Insofar
as this might be unfair upon the
insurance company for whom Mr. Eiser acts, that is a matter to be
settled between Mr. Eiser and
his client." Goldstone J. (as he
then was) in Protea Assurance Company Limited v.Januskeewics 1989 (4)
SA 292 (W) at 298D-299B.

"Applying
the principles laid down in decisions such as Nel v. Waterberg
Landbouwers Ko-operatieve Vereening 1946 AD 597

at 607,
it seems to me that the present case is one in which it would work an
injustice were a special order as to costs not to
be given. The
conduct on the part of the respondents outlined above is

66

reprehensible.
As I have indicated, the defences advanced, in the main application
in my view bordered on the trifling. At that
time, however, it seemed
to me that the resistance, although its founded, might have been no
more than misconceived. Since then,
it has become quite clear that
the respondents have been determined by a resort of procedural
stratagems and dilatory tactics to
achieve the 'practical course* I
was repeatedly asked at various stages to accept, and which I have
found myself unable at each
stage to accept (for reason which I have
been concerned at each stage to explain without delay). Overall I
have been obliged to
reach the conclusion that this conduct (viewed
in its full context) is vexatious, at the very least in the objective
sense contemplated
In re Alluvial Creek Ltd 1929 CPD 532 at 535 (and
see the further authorities collected in Cilliers Costs 2nd ed (1984)
para 4.13
at 54).....

It
further seems to me that in all the circumstances, the request that
costs be awarded on the scale as between attorney and own
client, and
not attorney and client, would be appropriate (as to the distinction,
see Cambridge Plan Ag v. Cambridge Diet (Pty)
Ltd and others 1990 (2)
SA 574(T); Malcolm Lyons and Munro v.

67

Abro and Another 1991 (3) SA 464(W) at 469D-E)."

Gauntlett AJ in belfante v. Delta Electrical Industries Ltd 1992(2)
SA 221(C) at 238 B-G."

He
submitted that the manner in which the case was conducted, the
allegations of dishonesty and impropriety levelled at LHDA and
the
members of its legal team which appear from some of the quotations
set out hereinabove, and the sheer waste of time and money
occasioned
by the manner in which the litigation has been conducted on behalf of
SDM and its associate companies, justifies an
order of costs on the
scale between attorney and own client, including the costs of two
counsel.

Mr.
Edeling submitted that LHDA's request for special order as to costs
arising from SDM's challenge to the bona fides of LHDA and
those
controlling it, is preposterous. To its credit, LHDA has not argued
that a common purpose abuse of power would be legally
irrelevant. It
seems to suggest that simply because on its submission the abuses of
power have not been established, that SDM must
be penalised for
having raised the issue. Such an attitude is difficult to reconcile
with the challenge by LHDA's counsel that
SDM should try and prove
conspiracy relied on. In any event, as set out above, there is an
abundance of

68

evidence
to support the finding contended for SDM.

He
submitted in the alternative that even if the Court should decide in
SDM's favour on another basis thereby relieving it of the
necessity
to make findings on all the other issues it has been indicated above
that SDM was fully entitled to challenge the conduct
of LHDA and
those behind it, and there can be no proper basis for denying SDM of
any portion of its costs. It may be noted that
at any early stage in
the trial the relevance thereof was argued and the Court ruled that
the conspiracy issue is properly before
the Court and may be
investigated.

He
submitted that the delays can certainly not be laid before SDM's door
and were caused by a combination of factors including the
complexity
of the case, the availability of the Court in Lesotho, availability
of witnesses, the other duties of the Chief Justice
and the
conspiracy of silence which forced SDM to exhaust every remedy in its
attempts to have the facts and documents placed before
the Court.

I agree
that a very insignificant time was taken up by some of my other
duties. It is unfortunate that no one kept a record of such
time when
the Court adjourned or started late because of my other duties. But
as I say that was a very

69

insignificant
time which cannot make any much difference. Be that as it may I will
be generous and allocate four (4) days for that.
This is a very
arbitrary decision based on no actual facts. The time will be divided
equally between the times spent on conspiracy
and that time on the
evidence of the chiefs and the Council of Ministers.

Although
the issue of conspiracy was relevant I am of the view that the manner
in which the case was conducted the issue of conspiracy
became
vexatious in the objective sense as the trial went on.

I order
that on the issue of conspiracy which was allocated 36 days I shall
deduct 2 days and then order SDM to pay LHDA costs on
the scale as
between attorney and own client for 34 days such costs to include
costs of two counsel.

On the
issue of whether the approval of Chiefs and Council of Ministers was
necessary I order SDM to pay costs to LHDA for 12 days
on the scale
as between party and party and such costs to include costs of two
counsel.

As far as
the costs in CIV/APN/198/91 and CIV/APN/206/91 are concerned the
order of the Court of Appeal was that the 1st and 2nd
respondents

70

were
directed to ensure that the proceedings in those two applications are
properly enrolled forthwith and expeditiously prosecuted
in terms of
the relevant Rules of Court. It seems to me that there has been no
compliance with that order I am therefore unable
to make any order of
costs in those two applications. They have not been properly
enrolled.

In
summary the Counter-Application is granted in terms of prayers 1 and
2. SDM shall pay LHDA's costs as stated above.

J.L.
KHEOLA

CHIEF
JUSTICE

28th
April, 1999

For
Applicants

For
Respondents