THE SUPREME COURT OF APPEAL
REPUBLIC OF SOUTH AFRICA

JUDGMENT

Not Reportable
Case no: 268/06

In the matter between:

SHEILA DEVI SINGH

Appellant

and

THE NATIONAL DIRECTOR OF PUBLIC PROSECUTIONS

Respondent

CORAM:   HARMS, CAMERON, LEWIS, CACHALIA JJA AND THERON AJA

DATE OF HEARING:
21 MAY 2007
DATE OF DELIVERY:
1 JUNE 2007

Summary:  Criminal Law – Application for preservation order in respect of immovable property in terms of s 38
of the Prevention of Organised Crime Act 121 of 1998 – The NDPP bears the onus of establishing reasonable
grounds to believe that the property is ‘an instrumentality of an offence’ – Property must play a real or
substantial role in the commission of the offence.

Neutral citation: This case may be cited as Singh v National Director of Public Prosecutions
[2007] SCA 82 (RSA).

THERON AJA/

[1] This appeal concerns a preservation order in respect of immovable property
consisting of land and buildings situated at 21 Bell Grove, Berea, Durban (‘the
property’), in terms of s 38(2) of the Prevention of Organised Crime Act 121 of 1998
(‘POCA’).1 The question is whether or not it has been established that the property
was an instrumentality of an offence as envisaged in POCA.2

[2] The National Director of Public Prosecutions (‘the NDPP’) applied, on an ex
parte basis, to the Durban High Court for a preservation order in respect of the
property. The NDPP alleged that the property was an instrumentality of the offence of
drug dealing in contravention of s 5(b) of the Drugs and Drug Trafficking Act 140 of
1992 (‘the Drugs Act’).3 The offence of contravening s 5(b) is listed in item 22 of
schedule 1 of POCA. The court granted the preservation order.

1 Section 38 of POCA reads:
‘Preservation of property orders
(1) The National Director may by way of an ex parte application apply to a High Court for an order prohibiting any
person, subject to such conditions and exceptions as may be specified in the order, from dealing in any manner with any
property.
(2) The High Court shall make an order referred to in subsection (1) if there are reasonable grounds to believe that the
property concerned-
(a) is an instrumentality of an offence referred to in Schedule 1;
(b) is the proceeds of unlawful activities; or
(c) is property associated with terrorist and related activities.
(3) A High Court making a preservation of property order shall at the same time make an order authorising the seizure of
the property concerned by a police official, and any other ancillary orders that the court considers appropriate for the
proper, fair and effective execution of the order.
(4) Property seized under subsection (3) shall be dealt with in accordance with the directions of the High Court which
made the relevant preservation of property order.’
2 In s 1 of POCA ‘instrumentality of an offence’ is defined as ‘any property which is concerned in the commission or
suspected commission of an offence at any time before or after the commencement of this Act, whether committed
within the Republic or elsewhere’.
3 Section 5(b) provides that ‘no person shall deal in any dangerous dependence-producing substance or any undesirable
dependence-producing substance’ subject to a number of exceptions which are not relevant for present purposes.
Section 1(1) of the Drugs Act defines ‘deal in’ to include ‘performing any act in connection with the transshipment,
importation, cultivation, collection, manufacture, supply, prescription, administration, sale, transmission or exportation
of the drug’.

[3] The evidence relied on by the NDPP is this. Singh (the appellant) is the owner
of the property and her son administered the property on her behalf. The property
comprises a main building with six bedrooms and three bathrooms, a wooden shed
and an outhouse consisting of two rooms and a bathroom. The property was let to a
tenant, Ms Joan Cele, who runs an unlicensed boarding establishment on the property,
offering accommodation at hourly and daily rates.

[4] The property has, during the period 1996 to 2003, been the subject of sporadic
continuous police action. As a result of this police action, 36 arrests have been made
on the property for drug-related offences. Arising from these arrests, nine persons
have been convicted of dealing in a substance prohibited in terms of the Drugs Act,
and four of them gave the property as their residential address. According to the
evidence, there were two outstanding warrants of arrest for persons charged with
dealing in drugs on the property, who had also given the property as their residential
address.

[5] During these police raids, drugs such as dagga, mandrax and cocaine were
found on the property.  It is alleged by the NDPP that some of the drugs found were in
quantities that exceeded the needs of one person, thereby suggesting that the drugs
were being sold from the property. Based on the aforegoing, the allegation is made
that drug dealers resided on the property and were using the property to sell drugs. In
addition, the NDPP relied on the admission by Cele, that she, as well as a previous
tenant, had, at some stage, sold dagga from the property.

[6] The NDPP makes the following allegations: That despite several warnings by
members of the South African Police Service (SAPS), neither Singh nor her son took
reasonable steps to ensure that the property did not become a haven for drug dealers
looking for a secure environment from which to ply their trade. Singh’s and her son’s
inaction resulted in a lack of diligent care, administration and supervision of the
property. The property played an integral role in facilitating drug dealing in that: (a) it
provided a safe house for drug dealers seeking refuge from the law; (b) it provided a
protected and secluded environment for drug dealers to ply their trade; (c) drugs are
easily stored on the property; (d) the property’s long history of association with drugs
made it a well known drug den which attracted drug dealers and (e) the running of an
unlicensed lodge perpetuated drug dealing on the property.

[7] Singh initially sought to have the preservation order set aside on the basis that
the ex parte procedure was unconstitutional but later abandoned this course as a result
of subsequent judgments.4 Singh then sought to have the preservation order
reconsidered and rescinded, first, on the basis that immovable property could never be
an instrumentality of the offence of dealing in drugs and alternatively, that the
property was not an instrumentality of an offence. In light of the decisions in National
Director of Public Prosecutions v R O Cook Properties (Pty) Ltd,5 Prophet v National

4 National Director of Public Prosecutions v Mohamed NO 2003 (4) SA 1 (CC) and National Director of Public
Prosecutions v R O Cook Properties (Pty) Ltd;  National Director of Public Prosecutions v 37 Gillespie Street, Durban
(Pty) Ltd; National Director of Public Prosecutions v Seevnarayan [2004] 2 All SA 491 (SCA); 2004 (2) SACR 208
(SCA).
5 [2004] 2 All SA 491 (SCA); 2004 (2) SACR 208 (SCA).

Director of Public Prosecutions6 and National Director of Public Prosecutions v
Mohunram,7 to the effect that immovable property can be an instrumentality of the
offence of dealing in drugs, Singh has abandoned the first ground as well.

[8] The high court dismissed the application for reconsideration, finding that the
frequency and extent of the drug dealing was so overwhelming that the conclusion
that the property was an indispensable part of the activity of drug dealing, and thus an
instrumentality, was inescapable. Singh sought leave to appeal against the refusal to
rescind the preservation order but this was refused on the basis that a preservation
order is not appealable. Singh is before us with the leave of this court.

[9] In Phillips v National Director of Public Prosecutions8 this court held that a
restraint order granted in terms of Chapter 5 of POCA is appealable. Howie P, writing
for the court, accepted that whilst a restraint order is only of interim operation and has
no definitive or dispositive effect as envisaged in Zweni v Minister of Law and
Order,9 it nevertheless has final effect because:
‘Absent the requirements for variation or rescission laid down in s 26(10)(a) [of POCA] (and
leaving aside the presently irrelevant case of an order obtained by fraud or in error) a restraint order
is not capable of being changed. The defendant is stripped of the restrained assets and any control or
use of them. Pending the conclusion of the trial or the confiscation proceedings he is remediless.

6 2006 (1) SA 38 (SCA); 2006 (2) SACR 525 (CC).
7 2006 (1) SACR 554 (SCA); 2007 (6) BCLR 575 (CC).
8 2003 (6) SA 447 (SCA).

9 1993 (1) SA 523 (A). Zweni set out the general requirements for determining the appealability of a judgment or order.

That unalterable situation is, in my opinion, final in the sense required by the case law for
appealability.’10

[10] In light of the decision in Phillips, counsel for the respondent conceded, and
rightly so, that the grant of a preservation order is ‘final’ in the sense required for
appealability - in the case of both restraint and preservation orders the court making
the order may only rescind or vary it in accordance with the provisions of POCA.11

[11] As I have already indicated, the NDPP’s case is that the property is an
instrumentality of the offence of dealing in drugs in contravention of s 5(b) of the
Drugs Act. As appears earlier, ‘instrumentality of an offence’ is defined as ‘any
property which is concerned in the commission or suspected commission of an
offence at any time before or after the commencement of this Act, whether committed
within the Republic or elsewhere’.  In Cook Properties12 this court held that it is
inappropriate to interpret this definition with ‘unbounded literalism’ and that the
Constitution required a narrower interpretation for a number of reasons. Section 25(1)
of the Constitution provides that ‘no law may permit arbitrary deprivation of
property’. Considering that deprivation of property is arbitrary when there is

10 Para 22.
11 In general, a restraint order granted in terms of Chapter 5 of POCA may only be varied or rescinded in accordance
with s 26(10)(a) which provides that a high court which made a restraint order:
‘may on application by a person affected by that order vary or rescind the restraint order or an order authorising the
seizure of the property concerned or other ancillary order if it is satisfied-
(i) that the operation of the order concerned will deprive the applicant of the means to provide for his or her reasonable
living expenses and cause undue hardship for the applicant; and
(ii) that the hardship that the applicant will suffer as a result of the order outweighs the risk that the property concerned
may be destroyed, lost, damaged, concealed or transferred.’
Section 26(10)(a) is, in substance, replicated in the context of Chapter 6 of POCA by section 47(1)(a).
12 [2004] 2 All SA 491 (SCA); 2004 (2) SACR 208 (SCA) para 13 per Mpati DP and Cameron JA.

insufficient reason for the deprivation,13 Cook Properties held that a literal
interpretation of the definition might lead to arbitrary deprivation of property and, in
order to avoid such an outcome, the definition must be interpreted in light of the
purposes of chapter 6 of POCA, which include: removing incentives for crime;
deterring persons from using or allowing their property to be used in crime;
eliminating or incapacitating some of the means by which crime may be committed;
and advancing the ends of justice by depriving those involved in crime of the property
concerned.14 Cook Properties also held that forfeiture would be unconstitutional if it
did not rationally advance the objectives of POCA because such forfeiture was ‘not
contemplated by or permitted under the Act’.15 It accordingly held that: (a) there must
be a reasonably direct link between the property and its criminal use and (b) the use of
the property must be functional to the commission of the crime and that the property
must substantially facilitate, make possible or be instrumental in, and not incidental
to, the commission of the offence.16

[12] This matter, in my opinion, bears a striking similarity to that of the Gillespie
Street Hotel in Cook Properties,17 where this court was faced with the question
whether a hotel was an instrumentality of an offence because drug and prostitution
offences were being committed on the property. In that case, too, during police raids
conducted on the property various narcotic substances and drugs were found and

13 First National Bank of South Africa Ltd t/a Wesbank v Commissioner of SARS 2002 (4) SA 768 (CC) paras 61-66, 97-
100.
14 Para 18.
15 Para 29.
16 Para 31.
17 [2004] 2 All SA 491 (SCA); 2004 (2) SACR 208 (SCA).

suspects arrested. The court had regard to the fact that the hotel was situated in an area
where drug offences were rife and that in the circumstance the hotel was likely to
attract a clientele who may possess drugs. The court also took into account that
members of the public could rent a room or rooms at the hotel for any length of time
and concluded:
‘The mere fact that drug dealers may frequent the hotel does not make it a “drug shop”. There is no
evidence that the persons arrested in the various raids and searches were the same people. There is
no suggestion that rooms were rented out or equipped for the purpose of drug dealing. Nor is there
any evidence that the premises themselves were used to manufacture, package or distribute drugs, or
that any part of the premises was adapted or equipped to facilitate drug dealing.’18

[13] Counsel for the NDPP contended that there were three factors that
distinguished this matter from Cook Properties. First, the property is not a hotel – it is
a single compact unit and Singh and her son, as owner and administrator of the
property, respectively, could reasonably be expected to have acted vigilantly and
exercised sufficient control over the property in order to prevent crimes being
committed thereon.19 I do not agree that this difference is material. The property had
been let to Cele who in turn rented out rooms to various tenants including persons
wishing to have casual sex - it is in the nature of a hotel such as the Gillespie Street
Hotel in Cook Properties.

18 Para 49.
19 This was the reasoning adopted by Nkabinde AJA in National Director of Public Prosecutions v Parker [2006] 1 All
SA 317 (SCA); 2006 (3) SA 198 (SCA) para 17.

[14] Secondly, it was argued that this court is enjoined to consider the broader
picture which emerges from the evidence regarding the raids on the property and this
includes the incidents of arrest, convictions, recovery of prohibited substances, and
the links between the arrested and suspected persons and the property – all of which
were indicative of a regularity which goes beyond mere incidental use of the property.
It was submitted that against the background of the police raids, combined with the
numerous complaints lodged by members of the community regarding the property
(complaints were lodged by a local councillor, a neighbour and the headmaster of a
nearby school who suspected that pupils from his school had purchased drugs from
the property), the inference can be drawn that the property had acquired a reputation
as a place where drugs were freely available. Relying on National Director of Public
Prosecutions v Parker,20 it was further submitted that even though the property had
not been specifically adapted for criminal purposes, as it was not necessary to adapt
the property in order to sell drugs, this court should find that the NDPP has
established (a) that the property was a well known drug haven and (b)
‘instrumentality’ on the basis of repeated use of the property as a venue for purposes
of concluding drug deals.
[15] In Parker the court found that the NDPP had established that the property was
not merely an incidental venue from which drugs were obtainable, but was in fact a
‘drug shop’. There is insufficient evidence to support such a finding in this matter.
The evidence as to the arrests, convictions and recovery of drugs from the property
must be considered in context. Having regard to the fact that the police action spanned

20 [2006] 1 All SA 317 (SCA); 2006 (3) SA 198 (SCA) para 22.

a period of seven years, this evidence is certainly not indicative of ‘regularity’ as
contended by counsel for the NDPP. The convictions of drug dealing amount to a few
per year and are more indicative of sporadic incidents of transgression.

[16] Thirdly, it was contended that this matter is distinguishable from Cook
Properties by reason of the evidence suggesting that the property was used for the
preparation of drugs for sale. In support of this contention counsel placed reliance on
photographic evidence indicating that small plastic packets as well as newspaper
wrappings, both of which contained dagga, were found on the sidewalk opposite the
property.  A similar plastic packet containing dagga was found in the outhouse on the
property. Newspaper containing dagga pips was found at the rear of the property. It is
alleged by the NDPP that pips are removed from the dagga leaves in the course of the
preparation of the dagga for sale. It is further alleged that the dagga had been prepared
on the property and then stored on the sidewalk as the property was subject to regular
police action. To link items found beyond the boundaries of the property with items
recovered from the property, and to draw an inference, based on speculative evidence,
that dagga was prepared for sale on the property is not justified on the totality of the
evidence.

[17] Property only qualifies as an instrumentality if it is used to commit the offence
and its use must be such that it plays a real and substantial part in the actual
commission of the offence. The fact that a crime is committed at a certain place does
not by itself make that place an instrumentality of the offence. A closer connection is

required. In this matter the link between the property and the offences is largely
incidental or fortuitous. The NDPP had to prove facts giving rise to reasonable
grounds for believing that the property is an instrumentality of the offence of dealing
in dependence producing drugs. The evidence had to demonstrate the role the property
played in the commission of this offence. The analysis of the evidence provides no
more than that persons who from time to time reside on the property either possessed
or dealt in drugs. There is no evidence that these persons were identified as drug
dealers or how often the same persons were involved in drug dealing or that they
permanently resided at the premises or did so for any extended period of time. The
drug dealing appears to have been committed by a number of different people acting
independently from each other. The linking of the property and the offences is in the
most general terms. These are, inter alia, that the boarding establishment has made it
possible for drug dealers to ply their trade in a protected environment and for
members of the public to enter the premises and purchase drugs on the pretext that
they were seeking accommodation. There is no evidence that the use of the property
was per se important or relevant to the success of the illegal activity.21 The evidence
established no more than that the property was a venue for dealing in drugs.

[18] For these reasons the following order is made:
(a)
the appeal is upheld with costs, such costs to include those consequent upon the
employment of two counsel;
(b)   the order of the court a quo is set aside and replaced with the following:

21 Prophet v National Director of Public Prosecutions 2006 (1) SA 38 (SCA) para 27.

‘The preservation order is set aside and the NDPP is directed to pay the costs of
the application.’

L V Theron
Acting Judge of Appeal

CONCUR:
HARMS DP)
CAMERON JA)
LEWIS JA)
CACHALIA JA)
THE SUPREME COURT OF APPEAL
REPUBLIC OF SOUTH AFRICA

MEDIA SUMMARY – JUDGMENT DELIVERED IN THE SUPREME COURT OF APPEAL

From:
The Registrar, Supreme Court of Appeal

Date:
Friday 1 June 2007

Status:
Immediate

Please note that the media summary is intended for the benefit of
the media and does not form part of the judgment of the Supreme
Court of Appeal

Singh v National Director of Public Prosecutions

In a judgment today the Supreme Court of Appeal has upheld an
appeal by a property owner (Singh) relating to a preservation order
granted in terms of s 38 of POCA in respect of her immovable
property.

The NDPP had alleged that the property was an instrumentality of
the offence of drug dealing in contravention of s 5(b) of the Drugs
and Drug Trafficking Act 140 of 1992.

Singh (the appellant) is the owner of the property and her son
administered the property on her behalf. The property has been let
to a tenant, Ms Joan Cele, who runs an unlicensed boarding
establishment on the property, offering accommodation at hourly
and daily rates. The property has, during the period 1996 to 2003,
been the subject of sporadic police action. As a result of this police
action, 36 arrests have been made on the property for drug related
offences. During these police raids, drugs such as dagga, mandrax
and cocaine were found on the property.  Based on the aforegoing,

the allegation was made by the NDPP that drug dealers were
resident on the property as well as using the property to sell drugs.
It was alleged by the NDPP that despite several warnings by
members of the South African Police Service (SAPS), neither
Singh nor her son, took reasonable steps to ensure that the
property did not become a haven for drug dealers looking for a
secure environment from which to ply their trade.

The SCA, in a judgment by Theron AJA in which Harms JA,
Cameron JA, Lewis JA and Cachalia JA concurred, held that the
analysis of the evidence provides no more than that persons who
from time to time reside on the property either possessed or dealt
in drugs on occasion. There is no evidence that these persons
were identified as drug dealers or how often the same persons
were involved in drug dealing or that they permanently resided at
the premises or did so for any extended period. The drug dealing
appears to have been committed by a number of different people
acting independently from each other.

--ends--