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NOT REPORTABLE

IN THE HIGH COURT OF SOUTH AFRICA

(EASTERN CAPE LOCAL DIVISION, PORT ELIZABETH)

 

In the matter between:                                                                       Case No: CC36/2017

Date heard: 17 – 22 October 2018

Date delivered: 26 October 2018

THE STATE

And

MORNE BLIGNAULT                                                                                   Accused 1

JACOB JOHANNES JACOBUS NAUMANN                                               Accused 2

MORNE STEVEN BLIGNAULT                                                                    Accused 3

JAN DANIEL CHRISTOFFEL PRINSLOO                                                    Accused 4

PAUL BEZUIDENHOUT                                                                                Accused 5

JUDGMENT

Goosen J:

Introduction

[1]        The accused were charged with several offences arising from their alleged participation in the illegal trade of abalone. Count 1 (preferred against all the accused) is an alleged contravention of s 2(1)(e) of the Prevention of Organised Crime Act (POCA)[1]. Count 2, (preferred against accused 1 and 2 only), relates to    s 2(1)(f) of POCA. These are counts of alleged racketeering activity. Count 3 (preferred against all the accused), relates to the conduct of a fish processing establishment in the period November 2016 to January 2017 without being in possession of a permit to do so, as prescribed by s 58(1)(a)(i) of the Marine Living Resources Act[2]. Counts 4 to 14 concerns several separate contraventions of Regulation 36(1)(a) of the Regulations promulgated under the Marine Living Resources Act i.e. fishing, collecting, keeping, storing and transportation of abalone on specific dates between 29 November 2016 and 26 January 2017. Count 15 (preferred only against accused 2, 3 and 4) involves a contravention of Regulation 36(1)(a) on 8 February 2017. Count 16 (preferred only against accused 1, 2 and 4) is a charge of theft, relating to the possession of a red Isuzu double cab which is the property of a Mr O. Caires, which was stolen on 20 January 2017.

[2]        At the commencement of the trial Mr Le Roux, for the state, handed up the written authorisations of the National Director of Public Prosecutions to prosecute the accused, as required by s 2(4) of POCA. Accused 1 pleaded guilty to counts 1, 2, 3 and 16. A plea statement tendered in terms of s 112(2) of the Criminal Procedure Act (hereinafter the Act)[3] sets out the factual basis of the pleas. Save for the plea in respect of count 3, the prosecution did not accept the factual basis of the plea. Accused 1 pleaded not guilty to the balance of the charges. Accused 2 pleaded guilty to counts 1, 3 and 15. Similarly, the prosecution accepted only the factual basis as pleaded in respect of count 3. Accused 2 pleaded not guilty to the remaining charges. Accused 3 pleaded guilty to count 15 and not guilty to the remaining charges. Accused’s 4 and 5 pleaded guilty to counts 1 and 3. Accused 4 also pleaded guilty to count 15. The pleas in respect of count 3 were accepted. They pleaded not guilty to the remaining charges. At the close of the state case the accused elected to close their cases without testifying.

[3]        It was agreed by defence counsel that the admissions contained in the accused’s respective pleas be entered as admissions made in terms of s 220 of the Act. Based on their plea of guilty to count 3, a conviction was entered in respect of accused 1, 2, 4 and 5. The state proceeded to adduce evidence in respect of the remaining charges. The prosecution called five (5) witnesses including three (3) accomplice  witnesses, each of whom was warned in terms of s 204 of the Act.

 

The Factual Background

[4]        The keen eye of Captain Stephen Erasmus and the quick response of members of the Directorate of Priority Crimes on 8 February 2017 led to the dismantling of the illegal abalone trading enterprise which is the subject of this case. On that evening Capt. Erasmus was in the company of his son, a member of the Anti-Poaching Unit. They had completed a patrol and had stopped to buy food. They were in the vicinity of Disa Avenue, Newton Park near the N2 on-ramp, when Capt. Erasmus saw a red Golf GTI travelling towards the freeway. It was being followed at close range by a red Isuzu double cab. Erasmus recognised the Golf GTI and its driver, accused 3.

[5]        Erasmus followed the vehicles onto the N2, heading in the direction of Grahamstown. The Golf GTI drove ahead. Near the Kempston Road off-ramp he caught up with the Isuzu. He noticed luggage on the rear seat. This struck him as odd since the Isuzu had a secure roller door type of compartment fitted on the load body. He suspected that the vehicle was transporting abalone

[6]        Erasmus called Capt. Swanepoel of the Organised Crime Unit and informed him. Members of the Unit were mobilised and set off along the N2 in pursuit of the Isuzu. Somewhere on the road towards Paterson the police undertook what was referred to as a “rolling stop” in which they forced the Isuzu to come to a halt. The driver of the Isuzu, accused 4, was arrested at the scene when it was discovered that the Isuzu was transporting abalone. The Isuzu and accused 4 were taken to the Kinkelbos police station where the vehicle was searched and members of the Department of Environmental Affairs were summoned to seize the abalone. Some 6013 abalone were seized, weighing approximately 700kg. The vehicle, to which was fitted false Gauteng number plates, was identified as a vehicle which had been stolen during a hijacking in Port Elizabeth on 20 January 2017.

[7]        As a result of information obtained following the arrest of accused 4, Capt. Erasmus obtained a search warrant to search the premises of an attorney, Brendan Weldrick, in Cape Road, Port Elizabeth. The search was conducted on 15 February 2017. Upon arrival Capt. Erasmus recognised a vehicle parked outside of the attorneys’ offices as one belonging to accused 1. He introduced himself to the receptionist and explained why he was there. He was told by the receptionist that the attorney was in consultation. Captain Erasmus went into the consultation room. Inside he found accused 1 and accused 2 in discussion with attorney Brendan Weldrick. Captain Erasmus explained that he was in possession of a search warrant and requested the attorney to accompany him during his search of the premises. He went out the back of the property to a garage/storeroom located on the premises. He asked attorney Weldrick for a key to the locked door. He was told that he did not have a key and that the storeroom had been let to a company called Hoya. Capt. Erasmus broke open the lock and entered the storeroom. In it he found two (2) freezers. On inspection of the freezers he suspected that they had recently contained abalone. The rest of the contents of the storeroom consisted of boxes of files and paperwork which emanated from the practice of attorney Weldrick. A police forensic team later inspected the freezers and took samples which were sent for DNA testing. These test results established that the freezers had indeed contained abalone.

[8]        Warrant officer Eksteen, who was stationed at the Directorate of Priority Crime Investigation is part of a team investigating Environmental Organised Crime. He is the investigating officer in this matter. He explained that on 8 February 2017 a total of 700 kg of abalone was found in the possession of accused 4 whilst being transported in the Isuzu LDV. On investigation of the vehicle it was established that it had false registration plates and that it was a stolen vehicle which had been stolen during an armed hijacking which had taken place on 20 January 2017 in the vicinity of Disa Avenue and Burt Drive in Newton Park. According to the case docket in that matter the owner of the vehicle, Mr Caires, was driving from his home at approximately 4:45 a.m. when he was accosted by six (6) men, one of whom was armed, and was robbed of his vehicle.

[9]        During the search of the vehicle at the Kinkelbos police station warrant officer Eksteen found two (2) bags which accused 4 identified as his property. The large bag contained clothing and other personal items. A smaller bag contained accused 4’s identity document, five (5) licence discs of various motor vehicles and a piece of paper on which was written a CA registration number. Inspection of the licence discs indicated that some were falsified. This included a false licence disc for the Isuzu reflecting the false registration plate numbers. There were two (2) licence discs for a VW Touran and a Golf. These were vehicles that the police had encountered in the vicinity of Paterson on that night. The licence disc for the Golf GTI was one related to the red Golf GTI driven by accused 3.

[10]      Warrant officer Eksteen confirmed that the tests which were done on the freezers found at the premises of attorney Weldrick, established that the freezers had contained abalone. He stated that after speaking to attorney Weldrick he was directed to a Mr Sam Lottering who was apparently the person renting the storage room. On 21 February 2017 he interviewed Lottering. As a result of information obtained from Lottering he was directed to a Mr Grobler, the owner of Auto Body Concepts, a panel beating firm in North End, Port Elizabeth. Both Lottering and Grobler gave detailed police statements relating to their involvement in this matter. Warrant officer Eksteen was also put in contact with a Mr Mark van Rensburg. He was informed that attorney Weldrick had approached van Rensburg on behalf of accused 1 to carry out lie-detector tests on certain persons involved in the panel beating business known as Auto Body Concepts. Copies of the audio recordings which were conducted in respect of four persons, namely Grobler, Mark Adams, accused 4 and accused 5 were made available to warrant officer Eksteen. He had these recordings transcribed and copies of the transcriptions relating to accused 4 and 5‘s interviews with van Rensburg were handed in as exhibits.

[11]      Warrant officer Eksteen also testified that he had obtained detailed cell phone data relating to the cell phone of accused 4 and that he was able to trace a pattern of communications between accused 2, 3 and 4. This data, he explained, was such that it is possible to trace the movement of the relevant handsets as they move from one cell phone reception tower to another on the network. It was accordingly possible to trace the movement of these handsets relevant to one another on various dates and at certain times. He also explained that he had undertaken a similar exercise in relation to the calls made between both Grobler and Adams. These communications established a pattern of calls taking place, mostly at night, followed immediately thereafter by the movement of the relevant handsets from their respective homes to the vicinity of Auto Body Concepts situated in North End, Port Elizabeth.

[12]      Warrant officer Eksteen’s analysis of the movements of the cell phone handsets belonging to accused 3 and 4 established that on two occasions at the end of January 2017 they had travelled in the direction of Cape Town on the N2 highway. He sought the assistance of colleagues stationed in Cape Town and requested them to access the video surveillance cameras located on the highways in Cape Town. According to him the video surveillance cameras are capable of number plate recognition and it is accordingly possible to identify vehicles passing particular camera points. He provided a Col. Jooste with the number plates of the Golf GTI and the Isuzu double cab. He was subsequently provided with information by Col Jooste which established that on 19 January 2017 the Golf GTI had entered Cape Town. The analysis of the cell phone data confirmed that the handsets of accused 3 and 4 were in the same area. Col Jooste also provided information regarding 26 January 2017. On that occasion video surveillance cameras identified both the Golf GTI and the Isuzu double cab passing various camera points approximately a minute or two apart. The movement of these vehicles corresponded with the cell phone analysis of the movements of the handsets of accused 3 and 4.

[13]      The prosecution presented the evidence of three (3) witnesses (Lottering, Grobler and Adams) who, by their own admission, were involved in aspects of the illegal trade in abalone which forms the subject matter of the pattern of racketeering activities which are the subject of counts 1 and 2. Each of these witnesses was warned in terms of section 204 of the Act.

[14]      Sam Lottering explained that he and accused 1 had been friends for a number of years. They had lost contact with one another when accused 1 had relocated to live in Johannesburg. However, when accused 1 returned to Port Elizabeth in or about June or July 2017 he and Lottering rekindled their friendship. They were both active in motor racing circles and motorcycling. Lottering explained that he conducted business as a motor vehicle mechanic. He also traded by buying and selling used vehicles. These he would purchase at vehicle auctions. For some time he and Grobler, who owned a panel beating business, had individually been involved in buying and selling vehicles. He explained that he would do the mechanical repairs to those vehicles which he had purchased and then send the vehicles to Grobler’s body shop for body work that was required. Grobler did the same in reverse.

[15]      At some stage after the middle of 2017 he and Grobler agreed to collaborate as partners in this business. They would accordingly buy vehicles together and then effect the repairs to those vehicles before selling them. They decided to look for a property which they could purchase and where they could build a large workshop at which this business could be conducted. A premises in Mangold Street, Newton Park was identified.

[16]      Lottering explained that accused 1 had approached him expressing a desire to become involved in the purchase and sale of motor vehicles. He and Grobler and accused 1 met at his house in Port Elizabeth. According to Lottering they agreed that accused 1 would make available the sum of R200, 000 which would be used to purchase vehicles. At that stage the offer to purchase the identified property in Mangold Street, Newton Park had already been made. Lottering and Grobler however were unable to raise the finance to purchase the property. Accordingly the property was purchased by Grobler’s father and it was agreed that the two of them would repay him the purchase price.

[17]      According to Lottering, accused 1, whom he knew to have been involved in the abalone trade, made a proposition of a business venture which would enable them to make easy money. The proposition involved the purchasing of and the selling of abalone to buyers in the market. He and Grobler agreed to this.

[18]      Lottering explained that accused 1 was essentially in control of the abalone enterprise which they had agreed to enter. Lottering’s responsibility was to furnish and maintain motor vehicles used for this enterprise. Grobler, on the other hand, was to provide a storage facility at his business premises, Auto Body Concepts. According to Lottering accused 1 introduced him to accused 2. Accused 2 was the person responsible for purchasing the abalone from the divers. Lottering explained that accused 2 would wait for a call to be made by the divers. Accused 2 would confirm that a purchase could be made and he would then contact accused 4 and 5 to meet the divers. The abalone would be weighed and the weight confirmed. An arrangement would be made to pay the divers and accused 4 and 5 would transport the abalone to the storage facility at Auto Body Concepts. Lottering explained that he occasionally was required to hold the cash used to pay the divers.

[19]      Grobler confirmed that he and Lottering had agreed to buy and sell motor vehicles in partnership. According to him he was introduced to accused 1 who wanted to be involved in this business. Grobler said that accused 1 had provided R200, 000 to Lottering for the purpose of buying vehicles at the auctions.

[20]      In regard to the venture involving the purchase of the property, accused 1 was not involved. Grobler stated that Lottering had advised him that accused 1 proposed involvement in the abalone trade. The money they earned would assist them to build their business and pay for the purchase of the property. According to Grobler the establishment of an enterprise to conduct an illegal trade in abalone was discussed at a meeting held at Lottering’s house in Port Elizabeth. He agreed to provide a storage facility at his business premises. He said there was a freezer at his premises which had been moved there from a takeaway business that he operated and later more freezers were installed. Grobler was introduced to accused 2. The arrangement was that accused 2 would contact him, usually at night, to inform him that abalone would be delivered for storage. Grobler would travel to the business to unlock it and deactivate the alarm. He would be present when abalone was off loaded and placed in the freezers.

[21]      This arrangement continued for a while but it proved to be too onerous for Grobler. As a result Grobler informed a trusted and longtime employee of his, Mark Adams, about the enterprise. He arranged that accused 2 would contact Adams to open the premises for deliveries. Grobler was however still contacted by the Security Company for clearance and this occurred.

[22]      Adams confirmed the evidence of Grobler. He stated that when he first became involved he would be contacted by accused 2 regarding a delivery. The abalone would then be delivered by a certain Simphiwe. At a certain stage however Simphiwe was no longer involved, as the deliveries were made by accused 4 and 5. He stated that on two (2) occasions accused 3 was present at the premises when deliveries were made. On one of these accused 3 paid him approximately R800, 00. He stated however that he could not recall dates. He was only able to assist with reference to his cell phone records from which he could work out when he had received calls and gone to open the premises. I shall return to a discussion of this evidence hereunder.

[23]      In order to complete the narrative it is necessary to focus on a sequence of events which occurred at the end of January 2017. These events are common cause. Lottering said that he received a telephone call from accused 1 towards the end of January 2017. Accused 1 told him that there was a problem with the weight of abalone which had been transported to the buyer. It appeared that abalone was missing. Accused 1 was angry and said they needed to find out who was responsible. Lottering informed Grobler. Shortly thereafter a meeting was called at Auto Body Concepts. The following people attended: accused 1, 2, 3, 4, 5, Lottering, Grobler and Adams. According to Lottering and Grobler accused 1 wanted to know who was responsible for the loss of the abalone. He was clearly angry. So too was accused 2 who allegedly said the culprit “should be killed”. Accused 1 gave those present until 3:00 p.m. to own up. When no-one did, accused 1 insisted that a lie detector test be taken by those involved. Lottering contacted his attorney, Brendan Weldrick, to arrange this.

[24]      According to Lottering he explained to Weldrick why it was required. Weldrick arranged for a certain Mark van Rensburg to conduct the tests. A meeting was arranged for this purpose at the office of Weldrick in Cape Road. The same persons attended. Four (4) persons underwent the lie-detector test – apparently a voice analysis – based on questions formulated by accused 1, van Rensburg and Lottering. The four (4) persons were accused 4, 5, Adams and Grobler.

[25]      A few days later the test results were made available and a further meeting was called. Adams was confronted with his test results. After initially denying having stolen abalone, he confessed. Accused 2 assaulted him and had to be removed from the room. Accused 1 demanded compensation. An agreement was brokered by Weldrick between accused 1 and Grobler in terms of which Grobler paid accused 1 R200, 000 and gave him a Ford Ranger which he owned. As a result of this the use of Auto Body Concepts as a storage facility ceased.

[26]      Lottering testified that he had earlier acquired use of the storage garage on Weldrick’s property apparently for the purpose of storing parts for Mercedes Benz motor vehicles. Following the termination of the use of Auto Body Concepts he gave accused 1 the key to the garage. It was common cause that the abalone which was seized at the arrest of accused 4 on 8 February 2017, had been stored in the garage at Weldrick’s premises. Lottering claimed not to be aware of this, although he did state that on the night in question he had been driving in the area keeping a lookout for police while the abalone was loaded.

 

Evaluation

[27]      The accused closed their cases without testifying.  Accordingly the evidence adduced by the state was uncontradicted. The plea explanations, as already indicated, contained admissions which were formally made in terms of s 220 of the Act.  Mr Le Roux, on behalf of the state, submitted that on the strength of these admissions and the uncontradicted evidence of the state witnesses this court ought to return a verdict of guilty in respect of those charges for which the accused pleaded guilty. Mr Griebenow, for accused 1 and 3, accepted that this is so. He argued though that the factual basis ought to accord with the plea explanation tendered. Mr van der Spuy, for accused 2, 4 and 5, adopted a similar stance.

[28]      There is no room for such finding. As indicated the accused adduced no evidence. Although the admissions made therein were formerly recorded as admissions, the plea explanations do not constitute a version in the form of evidence, the veracity of which is to be determined. The factual basis upon which the matter is determined is that set out in the uncontradicted evidence of the witnesses. Such differences or discrepancies as exist between Lottering and Grobler are of no consequence and do not impugn the credibility of either of them or the reliability of their evidence.

 

Count 1: Contravention of s 2(1)(e) of POCA

[29]      S 2(1) provides that: -

“(1) Any person who-

   (a)   . . .

   (b)   . . .

   (c)   . . .

   (d)     . . .

   (e)   whilst managing or employed by or associated with any enterprise,          conducts or participates in the conduct, directly or indirectly, of such             enterprise's affairs through a pattern of racketeering activity;

   (f)   . . .

or

   (g)   . . .

within the Republic or elsewhere, shall be guilty of an offence.”

 

[30]      The offence consists of the participation in the affairs of the enterprise through a pattern of racketeering activity. In S v Eyssen[4] it was held that:

“[5] The essence of the offence in ss (e) is that the accused must conduct (or participate in the conduct) of an enterprise's affairs. Actual participation is required (although it may be direct or indirect). In that respect the subsection differs from ss (f), the essence of which is that the accused must know (or ought reasonably to have known) that another person did so. Knowledge, not participation, is required. On the other hand, ss (e) is wider than ss (f) in that ss (e) covers a person who was managing, or employed by, or associated with the enterprise, whereas ss (f) is limited to a person who manages the operations or activities of an enterprise. 'Manage' is not defined and therefore bears its ordinary meaning, which in this context is: '1 be in charge of; run. 2 supervise (staff). 3 be the manager of (a sports team or a performer).'2

[6] The word 'enterprise' is defined in s 1 as follows:

'Enterprise' includes any individual, partnership, corporation, association,     or other juristic person or legal entity, and any union or group of individuals associated in fact, although not a juristic person or legal entity.

It is difficult to envisage a wider definition. A single person is covered. So it seems is every other type of connection between persons known to the law or existing in fact; those which the legislature has not included specifically would be incorporated by the introductory word 'includes'. Taking a group of individuals associated in fact, which is the relevant part of the definition for the purposes of this appeal, it seems to me that the association would at least have to be conscious; that there would have to be a common factor or purpose identifiable in the association; that the association would have to be ongoing; and that the members would have to function as a continuing unit. There is no requirement that the enterprise be legal, or that it be illegal. It is the pattern of racketeering activity, through which the accused must participate in the affairs of the enterprise, that brings in the illegal element; and the concepts of 'enterprise' and 'pattern of racketeering activity' are discrete. Proof of the pattern may establish proof of the enterprise, but this will not inevitably be the case”

 

See also S v Roberts and Others 2013 (1) SACR 369 (ECP) at par [10].

 

[31]      In this instance we are dealing with an enterprise in fact constituted by agreement between accused 1, Lottering and Grobler. The purpose of the enterprise was to engage in the procurement, processing, storage, transportation and sale of abalone. The evidence of Lottering and Grobler establishes this beyond any doubt. Both Lottering and Grobler testified that accused 1 was the central driving force of the enterprise. According to them he proposed the activity. He introduced them to accused 2 whose role and function was to procure the abalone by buying it from the divers and to arrange for its storage and transportation.  Accused 1 admitted the existence of the enterprise; its purpose; the employment of accused 2, 4 and 5 and their participation in the affairs of the enterprise. He also admitted the pattern of racketeering activity as established by the activities which form the subject of counts 3 to 15.

[32]      Accused 2, 4 and 5 similarly admitted all of the elements of the charge in count 1 and their direct involvement in the affairs of the enterprise through a pattern of racketeering activities constituted by the activities which form the subject of counts 3 to 15. Importantly, the commission of the individual offences set out in counts 4 to 14 was admitted. They admitted their involvement in the predicate offences. Their pleas of not guilty in relation to these charges were based on them having no knowledge of their involvement on the specified dates.

[33]      The only issue in relation to count 1 is whether the state has proved the guilt of accused 3. Accused 3 pleaded not guilty on the basis that he was not employed by the enterprise and that he therefore had no relationship with the enterprise. Mr Le Roux argued, correctly, that accused 3’s admission in respect of count 15 was insufficient. In order to establish accused 3’s direct or indirect participation in the affairs of the enterprise through a pattern of racketeering activities it is, however, not necessary to prove facts sufficient to establish the guilt of the accused on two (2) or more predicate offences. He argued that what is required is evidence which establishes a pattern i.e. on-going, continuous and repeated conduct which characterises the accused’s relationship to the enterprise.

[34]      It was submitted that the admitted facts and uncontroverted evidence in relation to count 15 established a modus operandi. This involved accused 3 driving his vehicle, a red Golf GTI, ahead of the vehicle transporting the abalone in order to keep a lookout for police activity so as to warn the driver of the transport vehicle.

 

[35]      According to Eksteen, evidence was obtained which pointed to similar conduct two (2) weeks prior to 8 February 2017. On that occasion cell phone data gathered in respect of the movement of handsets belonging to accused 3 and 4 indicated that they had travelled along the N2 to Cape Town. Photographs obtained from traffic surveillance cameras near Cape Town indicated both the Golf GTI and the same red Isuzu travelling past a camera point approximately 1 minute apart. This correlated with the data relating to the handsets. It was argued that this evidence entitled the court to draw the inference that the trip also involved the transportation of abalone.

[36]      In addition, Mr Le Roux relied on the fact that accused 3 had attended the meeting which was convened at Auto Body Concepts to discuss the suspected theft of abalone and that accused 3 had attended the lie-detector meetings held at the office of Weldrick. Mr Le Roux also pointed to the evidence of Adams which was that on two (2) occasions when abalone was delivered to Auto Body Concepts accused 3 had been present. On the one (1) occasion accused 3 had paid Adams and on the other he had parked his vehicle nearby when the abalone was offloaded.  The submission was that in the light of accused 3’s failure to offer any explanation for this conduct, it must be found that he was at least indirectly participating in a pattern of racketeering activities.

[37]      Mr Griebenow argued that in the absence of evidence sufficient to convict on two (2) or more of the predicate offences upon which the state relied, a conviction on count 1 cannot follow. He submitted that the evidence relating to the movement of accused 3’s handset along the N2 and the presence of the Golf GTI along the route together with the Isuzu was insufficient to allow the inference to be drawn that accused 3 was involved in the illegal transportation of abalone.    

[38]      In relation to Adams’ testimony Mr Griebenow submitted that it was unreliable. He pointed out that Adams’ testimony must be approached with caution in accordance with the cautionary rule to be applied to the testimony of an accomplice who had been warned in terms of s 204. Since Adams had made no mention of seeing accused 3 at Auto Body Concepts in the detailed statement he made to the police his viva voce evidence to this effect ought to be accorded no weight. It was also pointed out that Adams had claimed, in his statement, not to have been paid. Yet in his evidence he averred that accused 3 had paid him an amount of R800, 00. These discrepancies, it was argued, suggest a belated fabrication which taints the reliability of his evidence.

[39]      In order to secure a conviction for contravention of s 2(1)(e) of POCA the state must prove (a) that an enterprise existed; (b) that the accused managed, was employed by or associated with the enterprise; (c) that a pattern of racketeering activity existed and (d) that the accused directly or indirectly conducted or participated in the affairs of the enterprise through a pattern of racketeering activity. In S v De Vries and Others[5] it was held that the offence in terms of s 2(1)(e) is separate and distinct from its underlying predicate offences. Leach JA stated at par [48] that:

“[48] In order to secure a conviction under s 2(1)(e) of POCA, the State must do more than merely prove the underlying predicate offences. It must also demonstrate the accused's association with an enterprise and a participatory link between the accused and that enterprise's affairs by way of a pattern of racketeering activity.”

[40]      In S v Dos Santos the interrelationship between the so-called ‘umbrella’ offence (of racketeering) and the ‘predicate’ offences which establish the pattern of racketeering activity was considered.  It was held that the state is at liberty to charge an accused with these separate offences in separate indictments or in a single indictment.

[41]      In addressing argument advanced in that case about the necessity for a conviction on the predicate offences the court, per Ponnan JA, stated at par [40][6]:

“[40] In my view, whether to prosecute and what charge to file or bring before a court are decisions that generally rest in the prosecutor's discretion. Nor would it be necessary, it seems to me, for the court to return a verdict of guilty in respect of the predicate offences for the POCA racketeering charge to be sustained. It may well suffice for the court to hold that the predicate charge has been proved without in fact returning a guilty verdict. But that need not be decided here.”

 

 [42]     Whilst the Supreme Court of Appeal left open the question as to what would constitute proof of the predicate offences, it clearly expressed the view that a verdict of guilty in respect of the predicate offences was not necessary to sustain the racketeering charge. This manifestly must be so since the racketeering charge (either s 2(1)(e) or s 2(1)(f)) can be prosecuted without first prosecuting the predicate offences.

[43]      Mr Griebenow sought to suggest that where the state elects to prosecute both the racketeering charge and the predicate offences it is bound thereby and must, in those circumstances, prove the commission of the substantive predicate offences in order to secure a conviction on the racketeering charge. There is no reason or logic why that should be so. In any event, different evidentiary rules apply in respect of the separate charges. Indeed it is this very fact which gave rise to the arguments in Dos Santos that the combined indictment may give rise to an unfair trial. An argument which was rejected. S 2(2) of POCA specifically provides that a court trying a charge under s 2(1),

“(2) . . . may hear evidence, including evidence with regard to hearsay, similar facts or previous convictions, relating to offences contemplated in subsection (1), notwithstanding that such evidence might otherwise be inadmissible, provided that such evidence would not render a trial unfair.”

 

[44]      Such evidence as may therefore be admissible to establish participation or involvement in ‘racketeering activity’ may very well not be admissible in relation to the substantive offence, which constitutes the predicate for establishing racketeering activity.  This much was said in Dos Santos where it says, “may well suffice for the court to hold that the predicate charge has been proved”. That is the situation in this instance. The evidence presented by the state to establish the pattern of racketing activity may indeed be inadmissible in relation to the substantive charges set out in counts 4 to 14 or may be insufficient to found a conviction on those substantive charges. The admissible evidence however establishes the pattern of racketeering activity.

[45]      In my view, the question of accused 3’s participation in the affairs of the enterprise through a pattern of racketeering activities can be determined without reference to the evidence of Adams relating to accused 3’s presence at Auto Body Concepts.  

[46]      It is not in dispute that accused 3 attended the meeting convened at Auto Body Concepts when the missing abalone was to be discussed. This meeting took place towards the end of January. The purpose of the meeting was to establish who was responsible for the loss of abalone. This meeting occurred after the last load of abalone was collected from the body shop. According to Adams he had assisted accused 4 and 5 to load the abalone into a red Isuzu double cab. He was instructed to fit false GP number plates to the vehicle, which he did.

[47]      The undisputed evidence of Eksteen was that on 26 January the Golf GTI and the red Isuzu double cab travelled to Cape Town, as previously described. The Golf GTI, subsequently used by accused 3 on 8 February 2017, was in convoy. If, as accused 3 would have it in his plea explanation, he only agreed to assist his father, accused 1, on 8 February 2017, the question that arises is what he was doing at the meeting relating to the lost abalone two (2) weeks earlier. Accused 3 gave no explanation. In my view, the only reasonable inference to be drawn from the known facts, namely

-     that the Isuzu double cab was used by accused 4 and/or 5 to transport abalone;

-     that both the Isuzu and the Golf GTI travelled into Cape Town along the N2 in convoy;

-     that accused 3 and 4’s handsets were tracked moving along the same route at the same time;

-     that abalone transported to the market at about that time was found to be missing; and

-     that accused 3, inter alia, attended the meeting to enquire into the loss,

is that accused 3 had participated, directly or indirectly, in predicate offences of the enterprise which constitute racketeering activities.

 

[48]      There can be no doubt that accused 3 was aware that the activities of the enterprise were illegal. The fact that a verdict of guilty on one or more of the predicate offences cannot be entered based on the available evidence does not alter the fact that the admissible evidence on the charge of racketeering establishes that he participated in the enterprise through a pattern of racketeering activity. In the circumstances, I am satisfied that accused 3 is guilty of the offence set out in count 1.

 

Count 2

[49]      S 2(1)(f) provides that any person who:

“(f)   manages the operation or activities of an enterprise and who knows or           ought reasonably to have known that any person, whilst employed by    or associated with that enterprise, conducts or participates in the   conduct, directly or indirectly, of such enterprise's affairs through a   pattern of racketeering activity;

within the Republic or elsewhere, shall be guilty of an offence.”

 

[50]      The offence consists in the accused’s knowledge (actual or imputed) that another person participated in the conduct of the affairs of the enterprise through a pattern of racketeering activity. 

[51]      Accused 2 pleaded not guilty on the basis that he was merely an employee of the enterprise and played no role in the management of the enterprise or its activities.

[52]      Lottering’s evidence was that accused 2 was the person responsible for buying the abalone from the divers and was responsible for arrangements to have the abalone weighed (by accused 5) at rendezvous points arranged with the divers, and relaying the amount to be paid for the abalone. Accused 2 would also make arrangements to transport the abalone to and from Auto Body Concepts. It was he who contacted Grobler and Adams to open the premises both for delivery and collection of the abalone.

[53]      It was argued by Mr van der Spuy that accused 2 fulfilled no management role and that control of the enterprise vested in accused 1. On this basis it was submitted that the requirements of s 2(1)(f) were not met inasmuch as it was not established that accused 2 held any management authority.

[54]      As noted in Eyssen s 2(1)(f) is more limited than s 2(1)(e). It applies to a person who ‘manages the operation or activities’ with knowledge that another person participates in the affairs of the enterprise. The word ‘manage’ must be accorded its ordinary meaning. It must also be understood in the context in which it is used, namely in relation to the conduct of operations or activities of an ‘enterprise’.

[55]      As indicated in the Eyssen matter the definition of ‘enterprise’ is very wide. It includes any form of arrangement between persons known to the law. What the term envisages is a form of organisation which fulfils a purpose. That purpose is fulfilled through activities which comprise a pattern of racketeering activity. This activity, which may involve a wide variety of separate and diverse transactions involving one or more (and even a multitude) of persons or entities, must necessarily be managed or controlled in some way in order to achieve its purpose.  It is this process of management which s 2(1)(f) addresses. If the term ‘manage’ is to be given its ordinary meaning then it must be recognised that management of the operations or activities can occur at different levels within the enterprise. Common sense suggests that this must be so. The managerial control posited by s 2(1)(f) cannot, in my view, be equated with only the highest level of control. 

[56]      In developing the argument in support of this Mr Le Roux referred to a decision of the United State Court of Appeals of the 8^th Circuit Court in Reves et al v Ernst & Young [1993] USSC 26; 507 US 170 in which consideration was given to the concept of participation in the ‘operation or management’ of the enterprise as required by provisions of the Racketeer Influenced and Corrupt Organisation Act (RICO) 18 U.S.C. In that matter it was held that a ‘liberal construction’ (as required by the Act) would suggest that ‘operation and management’ is not confined to upper management.

[57]      This would, in my view, accord with the ordinary meaning to be attached to the word ‘manage’ and would, furthermore meet the purpose of the provision within POCA read as a whole. That approach leads me to conclude that ‘management’ of certain activities, even under superior authority within the enterprise, would render the person so found to be ‘managing’ liable in terms of s 2(1)(f). In each instance the factual circumstances will need to be evaluated to determine the role of the person concerned.  

[58]      In this case the evidence points to the fact that accused 2 played a key role in the control of operations of the enterprise. He was responsible for contact with the sellers of abalone; he organised the purchasing; and exercised control over the transportation of the abalone to and from the storage facility. The fact that he may have done so under the overall control of accused 1 does not absolve him of management responsibility for those operations of the enterprise. There can be no doubt that he carried out these responsibilities with the knowledge that other persons, in this case accused 3, 4, 5 and Adams, were directly or indirectly involved in affairs of the enterprise through a pattern of racketeering activity. In the circumstances accused 2 is guilty of count 2.

 

Count 3

[59]      As indicated at the outset, a conviction was entered in respect of accused 1, 2, 4 and 5 on count 3, based on their pleas of guilty. All that need be considered is the position of accused 3 who pleaded not guilty. The only evidence implicating accused 3 on this charge is that of Adams, referred to above. Mr Le Roux submitted, properly in my view, that the evidence of Adams, even if accepted, is insufficient to found a conviction on the charge. I agree. In the circumstances accused 3 stands to be acquitted on count 3.

 

Counts 4 – 14

[60]      Mr Le Roux conceded that in relation to counts 4 to 14, the so-called predicate offences which establish the pattern of racketeering, the evidence does not meet the standard of proof required to found convictions for the substantive charges. Although Adams and Grobler testified to the pattern of transportation of abalone to and from Auto Body Concepts and the storage of abalone at the premises and could confirm the dates when this had occurred on the basis of cell phone data, neither was able to testify to the presence and/or involvement of any of the accused on a specific date. In the circumstances the concession made by Mr Le Roux was properly made. It follows that the accused stand to be acquitted on counts 4 to 14.

 

Count 15

[61]      This count relates to the incident on 8 February 2017 when accused 4 was arrested and found to be in possession of 6013 abalone. Accused 2, 3 and 4 each pleaded guilty to this count. In accordance with the admitted facts and the uncontested evidence of Erasmus and Eksteen, a conviction on this count must follow.

 

Count 16

[62]      It was not in dispute that the Isuzu double cab was stolen during a hijacking which occurred on 20 January 2017. Accused 1 pleaded guilty to theft of the Isuzu double cab on the basis that he had suspected that the vehicle, which he had requested accused 2 to acquire, was stolen. Accused 1 thereafter requested Lottering to modify the rear suspension by strengthening it. Accused 2 and 4 pleaded not guilty. In explanation of their plea it was stated that neither had knowledge that the vehicle was stolen and had no reason to suspect that it was stolen. The evidence of Lottering was that accused 2 and 4 brought the vehicle to him at some stage in late January so that he could do the modifications.  

[63]      Adams testified that the vehicle was used by accused 4 and 5 to collect abalone from the body shop and that he was told to fit false registration plates and discard the original number plates. When accused 4 was arrested he was found in possession of several false licence discs including one for the Isuzu reflecting the registration details in the false number plates attached to the vehicle.

[64]      During cross-examination Eksteen had agreed that false registration plates are attached to vehicles occasionally used in the transport of abalone. Based on this, and his evidence that accused 1 was in possession of many vehicles, Mr van der Spuy argued that it is reasonably possibly true that accused 2 and 4 did not know that the vehicle was stolen.

[65]      The argument, however, loses sight of the fact that the accused put up no version, the veracity of which falls to be considered. The only evidence presented points to knowledge on the part of accused 2 and 4, that the vehicle was stolen. The fitting of false number plates and the creation and use of a false licence disc point to concerted effort to obscure the true identity of the vehicle. There is no evidence to suggest that these steps were routinely undertaken even in respect of vehicles lawfully in possession of the accused. In the circumstances accused 1, 2 and 4 are guilty of theft

[66]      Finally there is the question as to the indemnification of the s 204 witnesses. It was not suggested on behalf of the accused that either Lottering, Grobler or Adams had not frankly and honestly answered all questions addressed to them relating to their involvement in the commission of these offences.  The discrepancies between Lottering and Grobler regarding the formation of the enterprise and its relation to other business activities are, in my view, minor and of no moment. Insofar as Adams is concerned, his evidence implicating accused 3 was subjected to criticism. I have addressed this in the context of the cautionary rule that applies and placed no reliance upon this aspect of his evidence. Apart from this, I consider that he was frank and honest in relation to all aspects bearing upon his involvement in criminal activity. In the result each of Lottering, Grobler and Adams is entitled to indemnification from prosecution in respect of the offences set out in the charge sheet. In the case of Adams this extends also to a charge of theft of abalone and possession of abalone arising therefrom.

[67]      The following order will issue:

            1.         Accused 1 is found guilty on counts 1, 2, 3 and 16.

            2.         Accused 2 is found guilty on counts 1, 2, 3, 15 and 16.

            3.         Accused 3 is found guilty on counts 1 and 15.

            4.         Accused 4 is found guilty on counts 1, 3, 15 and 16.

            5.         Accused 5 is found guilty on counts 1 and 3.

            6.         The accused are acquitted on the remaining counts for which                           there were charged.

             

 

G.G. GOOSEN

JUDGE OF THE HIGH COURT

 

 

 

 

Appearances:                     For the State:

                                                Adv M.L. Le Roux

                                                NDPP, Uitenhage Road, North End, Port Elizabeth

                                                Tel: (012) 842 1400

           

                                                For Accused 1 and 3

                                                Mr A Griebenow

                                                157 Cape Road, Mill Park, Port Elizabeth

Tel: (041) 373 5530

 

For Accused 2,4 and 5

Mr van der Spuy

Legal-Aid, South Africa

Uitenhage Road, North End, Port Elizabeth

(041) 408 2800

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