New rule for wine sales in grocery stores

© Luca Bertolli – 123RF.com

This is after the Constitutional Court dismissed, on Tuesday, an application to confirm a judgment by the Grahamstown High Court that provisions of the Eastern Cape Liquor Act which came into effect in 2004 were constitutionally invalid.

The province's Liquor Board had granted Shoprite Checkers grocer's wine licences which allowed the supermarket group to sell table wines with groceries in its 27 shops throughout the Eastern Cape between 1989 and 2003.

However, in 2004, the province introduced a new law that banned the sale of table wines inside grocery stores.

They were given 10 years to comply, after which they could apply for a new licence to sell liquor, but on separate premises.

Shoprite Checkers challenged the provisions and the high court found in favour of the supermarket group last year.

It held that Shoprite's wine licence constituted property under Section 25 of the constitution, and that the new law arbitrarily deprived the food retailer of this property.

In its judgment, the Constitutional Court held that although the licence constituted property, the termination of the licence did not amount to arbitrary deprivation of property as the retailer was allowed to apply for a new licence that would enable it to sell all kinds of alcohol, albeit in separate premises.

The main judgment by Justice Johan Froneman noted that change in the regulatory regime did not extinguish any fundamental rights of the holders of grocer's wine licences.

In a concurring judgment, Deputy Chief Justice Dikgang Moseneke agreed that the application for constitutional invalidity of the legislation be dismissed, but disagreed that a licence constituted property.

He said licences were subject to administrative withdrawal and change.

"They are never absolute, often conditional and frequently time-bound," he said.

In a dissenting judgment, Justice Mbuyiseli Madlanga agreed that the grocer's wine licence was definitely property, but said the deprivation was without reason. He would have upheld the high court judgment, he said.