Business Maverick

HAZY LAW

Cannabis grow clubs want High Court to decide if customers can ‘sit back, relax and enjoy the fruits’ of their joint labour

(Photos: Facebook / The Haze Club)

In September 2018, the Constitutional Court decriminalised the private cultivation of cannabis by adults for personal private consumption. This created an opportunity for businesses to ‘privately’ grow and prepare cannabis for clients. But recent police action has nipped their operations in the bud, so they want legal clarity.

In October this year, police in the Western Cape announced that provincial detectives had arrested two suspects on drug trafficking charges during a raid at a business park in the suburb of Ottery.

Members of the Detectives Narcotic Unit and Flying Squad “uncovered a hydroponic cannabis laboratory comprising dagga-drying equipment and various dagga plants valued at around R82,200,” police spokesperson Colonel Andrè Traut had said.

He added: “Four cooling units transformed into hot houses, fully equipped with plants in various stages of cultivation, were found. The equipment, the plants and a substantial amount of dried cannabis were confiscated.”

It turned out the target of this clampdown had been The Haze Club (THC), described on its website as “South Africa’s first 100% Legal Premium Growing Service”.

This service is what is known as a cannabis grow club – there are apparently several in South Africa – and involves a business leasing to clients what it deems to be private space, in an appropriate facility, where it cultivates clients’ cannabis on their behalf.

It is aimed at those who do not have the personal space, know-how or time to properly grow and cure quality cannabis.

In other words, viewed via the lens of a meal service, it would be like renting an equipped plot and kitchen for a farmer to grow your own vegetable seeds and a chef to eventually cook the resultant produce. The readymade meal is then delivered to you, or you can fetch it.

Police and prosecuting authorities appear to have classified the cannabis version of these services as illegal.

Lawyers, on behalf of THC, are now preparing to turn to a court to determine the legality of the cannabis grow club model, as implemented by THC.

If this matter proceeds, the outcome will have far-reaching implications – it will either mean South Africans can effectively outsource their cannabis growing and preparation, or will be forced to find ways and resources, in some cases space, to grow their own.

Cannabis plants at The Haze Club, a premium cannabis grow facility. Two of the company’s directors were arrested during a raid in Ottery, Cape Town, in October 2020. (Photo: SAPS)

Andrew MacPherson of law firm Cliffe Dekker Hofmeyr is representing THC.

Paul-Michael Keichel of Schindlers Attorneys, who was among those involved in a pivotal Constitutional Court case relating to cannabis use, is assisting Cliffe Dekker Hofmeyr on a pro bono basis.

They provided comment to Daily Maverick this week ahead of their exact legal plan being finalised and confirmed.

The two THC directors arrested during the raid in Ottery in October, whose names have not been publicised, are expected in the Wynberg Magistrates’ Court in Cape Town towards the end of January 2021 on charges relating to dealing in, or possessing, cannabis.

MacPherson explained: “We intend to stay the criminal prosecution, pending the hearing of a declaratory application in respect of the grow club model. 

“The declaratory order [may] be launched in the Western Cape High Court. We are busy finalising the application and hope to launch it as soon as possible.”

Taking into consideration the court’s break until mid-January and possible Covid-19 repercussions, it was expected that if this legal avenue was indeed pursued, the application relating to the declaratory order would be launched and heard within the first seven months of next year.

This legal strategy is still subject to potential change.

The Cape Cannabis Club (also known as C3), a grow business that suspended operations last week to avoid police potentially targeting them, plans to join the possible legal proceedings relating to THC as amicus curiae (friend of the court).

In September 2018, in a landmark case, the Constitutional Court effectively ruled it was not illegal for adults to use and cultivate cannabis in private spaces. (This is the case that Keichel was also involved in.)

“An example of cultivation of cannabis in a private place is the garden of one’s residence,” a section of those court papers stated.  

“It may or may not be that it can also be grown inside an enclosure or a room under certain circumstances. It may also be that one may cultivate it in a place other than in one’s garden if that place can be said to be a private place.”

The government was given two years to amend the relevant legislation.

The Cannabis for Private Purposes Bill was subsequently passed in August 2020 and is expected to be further discussed and analysed in Parliament in 2021.

But it is the Constitutional Court case that the THC-based matter is likely to hinge on.

The Haze Club premises in Ottery, Cape Town. (Photo: SAPS)

THC’s website – the home page which shows an unfolding gold cannabis leaf – explained how the business operated:

When a member signed up, they were assigned a fixed space “within THC’s state-of-the-art facility, the lease of which is included in the membership fee”.

A monthly fee could be anything from R485 for a plant shared between three members, to R1,320 per month over three months for the cycle of a single plant.

Members could choose a clone of a mother plant being kept for others or “supply the club with your feminised seeds of choice”.

Professional growers looked after a member’s plant from seed to harvest and every few weeks a member was sent updates on the plant’s growth.

“Once we’ve dried, cured, and hand-trimmed your plant, your premium flower is packaged in our sealed THC box and is ready for collection or delivery. Sit back, relax and enjoy the fruits of our joint labour,” the THC website said.

Under a section about its legality, it stated: “To comply with the law, individual areas in the club’s grow facility are demarcated and leased to its members – thereby making it their private space. The club simply assists members in exercising their constitutional right to grow cannabis in their own private space.”

MacPherson further explained that “the cannabis (from seed to dry bud) is always the property of the member, and by their rental of the private space, they are also always in possession of their cannabis with the club and staff acting in an agency role tending to the plants”.

However, police and prosecuting powers seemed to view this type of operation as dealing in a prohibited substance – a crime.

Keichel said: “We disagree and hope to convince a court to declare that this is not so and that the model, if done within strict parameters, corresponds with the spirit and purport of the judgment of the Constitutional Court.”

He explained that there was no direct exchange of cannabis for money as a client’s cannabis was grown for them in a private rented space.

“A bespoke ‘gardening service’ is then provided, whereby that person’s cannabis is tended to by people who know how to grow cannabis,” Keichel said.

 “The Justices of the Constitutional Court would not [in our opinion] have intended to limit the right to grow cannabis to those with enough private space and green-enough fingers to do so [thereby discriminating against the rest of us]. Thus, the grow club model does no more than to extend the right to grow one’s own cannabis to all who wish to exercise it.”

Cannabis plants being cultivated at The Haze Club, a premium cannabis grow club. (Photo: SAPS)

A Schindlers Attorneys’ media release said it was hoped that “legal certainty in respect of the grow club model” would be achieved.

It also said that, together with Cliffe Dekker Hofmeyr and THC, it intended to eventually “call for support from members of the public who may have an interest in the aforesaid”.

Jack Stone, the alias used by the Cape Cannabis Club’s director, said the business has been operating since early 2020, but due to factors including lockdown, formally launched at the end of June with 50 founding members. By the first week of December, it had grown to just under 3,000 members across South Africa.

Cannabis was grown at an independent growing facility, the location which Stone did not want to divulge.

The business involved “millions of rands worth of capital equipment”.

“Everything was organic, and everything was controlled,” Stone said.

The Cape Cannabis Club’s website explained that the service it offered was legal because the Constitutional Court judgment said adults were entitled to grow and personally use cannabis in private.

“The court also acknowledges that ‘private spaces’ exist outside of the home,” it said.
“You’ll still be growing for your personal use, in private, simply by renting out or leasing a private, demarcated piece of land from us on which to grow that plant.”

But on 9 December, after consultations with lawyers and due to worries about the October raid at THC, the Cape Cannabis Club decided to immediately suspend its operations.

“We destroyed thousands of plants, it was heart-breaking,” Stone said.

“We were VAT-registered, a business trying to do it by the book. But the authorities are not prepared to look at the grow club model… Now we sit back and wait for a court of law to decide whether this business model is legal or not.”

Stone was confident the grow club model would be permissible by law.

A notice published on the Cape Cannabis Club’s website last week referred to the arrests of THC’s directors in October.

“Clearly our legal team’s interpretation of the law as it now stands is completely different to that of the SAPS and the NDPP [National Director of Public Prosecutions],” it said.

“Our legal team and the directors believe that we will be successful in a court of law and that a judge will uphold the constitutional rights of all adults in South Africa to cultivate, possess, and consume cannabis in this country in private. 

“This constitutional right would also involve paying a membership fee to a grow club to grow, harvest, cure, store and deliver the final cannabis product to the member’s private address anywhere in South Africa.” DM/BM

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All Comments 3

  • Let’s hope that THC wins this case, not just for all of us as private citizens, but also for the economy as a whole. The Bad Old Days of the heavy hand of the law in private affairs should be long gone by now, as the ConCourt rightly said in September 2018.

  • Those poor vulnerable soles who cannot manage without some sort of drug support, whether it is dagga, alcohol, tic, heroin or any of the many others will always be up for exploitation by profit hungry, unscrupulous leaches of our society whether in the guise of horticulturalists, medical experts, attorneys and advocates or just criminals (to use an appropriate collective noun). Donald Moore.

  • The frequent reference to ‘Stone’ makes me wonder if it is not supposed to be stoned ? However…it is important that we realise that ‘they’ have done their ‘homework’ with the assistance of unscrupulous legal minds (and there are many out there)… and thus it would not surprise me if they ‘win’ this case on a ‘technicality’. However what it will fail to address are ‘other’ social issues such as what the guy/gal (apologies to the transgender) with limited resources does to get… stoned ?! Based on the figures in this article, this is an ‘option’ which only the well heeled will be able to access. In many respects … not very different to the ability of ‘poor’ countries to access the covid vaccinations !