Government’s duty to be a model litigant

May 1st, 2012
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By Ian Gough

The commencement, defence and conduct of litigation by the government or its departments constitute the exercise of public power (A Dodek ‘Lawyering at the intersection of public law and legal ethics: Government lawyers as custodians of the rule of law’ (2010) 33 (1) Dalhousie Law Journal at 18). This power must therefore be exercised by the government’s representatives in a manner consistent with the public interest. This article examines what that duty entails in the context of litigation.

Public power and the public interest

The accounting officer of a department, its head, is responsible for the control and management of the funds allocated to his department in terms of the Public Finance Management Act 1 of 1999 (PMFA). He is also responsible for the effective, efficient and economic use of the department’s resources, the collection of debts, the settlement of contractual and other obligations and the payment of all money owing by the department (s 38(1)(b)(c) and (d) of the PFMA).

In terms of s 76(1)(b) and (f) of the PFMA, treasury has published regulations relating to litigation against the state. In terms of reg 12(1) and (2) of the treasury regulations for departments, trading entities, constitutional institutions and public entities, the state, subject to certain exceptions, will pay any claim arising from the activities of an official carrying out his duties or otherwise in the course and scope of his employment. Thus, insofar as contractual and other claims for damages are concerned, the accounting officer is responsible for the department’s litigation. The head of the department’s control over litigation is further evidenced by reg 12.2.4, in terms of which the state attorney may not obligate the funds of the department without the head’s written approval. This would include the briefing of counsel, the payment of experts, the appointment of correspondents, payment of other disbursements and the settlement of any claim.

However, even in matters not involving pecuniary interests, the head of the department in his capacity as such is responsible for litigation involving his department.

In Chirwa v Transnet Ltd and Others 2008 (4) SA 367 (CC) Ngcobo J stated at para 138:

‘[W]hat makes the power in question a public power is the fact that it has been vested in a public functionary, who is required to exercise the power in the public interest. When a public official performs a function in relation to his or her duties, the public official exercises public power.’

Further, in Hughes Aircraft Systems International v Airservices Australia (1997) 76 FCR 151 it was said that the state or a government may only litigate in the public interest.

Any decision relating to litigation involving a department made by its head will therefore amount to the exercise of public power.

What the government’s duty entails

Exercising public power has certain constitutional consequences, including:

  • Any decision of the head of the department relating to litigation must be reasonable and rational (Pharmaceutical Manufacturers Association of SA and Another: In re Ex Parte President of the Republic of South Africa and Others 2000 (2) SA 674 (CC)).
  • The decision must be fair (Masetlha v President of the Republic of South Africa and Another 2008 (1) SA 566 (CC)).
  • The decision must satisfy the requirements of legality. It must be intra vires and must not be made for an improper purpose (the Pharmaceutical Manufacturers and Masetlha cases).

Where the claim has a bearing on the department’s resources, the decision must be made with due regard to the provisions of the PFMA and its regulations. The Constitution will at all times have an overriding and overarching effect.

In terms of s 34 of the Constitution, everyone has a right to a fair hearing before a court or other tribunal and every organ of state is bound to comply with this right. As part of the state, every department must respect, promote and fulfil the rights in the Bill of Rights, including the right to a fair trial. Accordingly, a government or department involved in litigation not only has a duty not to hinder its opponent in any litigation but must also actively ensure that litigious fairness occurs.

The notion of fairness is fluid and flexible (the Masetlha case). In the context of litigation, fairness would be influenced by its nature; complexity; importance, political or otherwise; and the identity and nature of the department’s opponent. It would also be influenced by whether the opponent is represented and, if so, the expertise of such representation.

Being fair, which is equivalent to the Australian Commonwealth’s duty of fair dealing, would include the following:

  • Not harassing the other party to litigation and not conducting litigation as if it were war (Permanent Secretary, Department of Welfare, Eastern Cape, and Another v Ngxuza and Others 2001 (4) SA 1184 (SCA) at para 15).
  • Respecting a judgment and not acting contrary thereto (the Ngxuza case and Njongi v MEC, Department of Welfare, Eastern Cape 2008 (4) 237 (CC)).
  • Not taking advantage of impecunious litigants (Ngxuza and Njongi).
  • Not failing to comply with the time limits within which litigation could reasonably be finalised.
  • Preparing for trial. The court could well award attorney and client costs to the party seeking an adjournment where there has been failure to prepare for trial (Steenbergen and Others v Minister of Safety and Security (FB) (unreported case no 1071/2003, 1027/2003, 21-7-2011) (Fischer AJ)).

Settlement and costs orders

In addition, there is a duty to attempt to settle a dispute prior to litigation or to limit the issues in the dispute so that only the actual issues in dispute are on trial. In Nyathi v MEC for the Department of Health, Gauteng and Another (TPD) (unreported case no 26014/2005, 30-3-2007) (Davis AJ) attorney and client costs were awarded against the first respondent, which did not agree on an interim payment in an action for damages and the impecunious applicant was compelled to apply for such an order.

In Leboho v Premier of Limpopo and Others (GNP) (unreported case no 37898/07, 28-1-2011) (Raulinga J) costs on an attorney and client scale were awarded against the first and second respondents because common cause facts were unnecessarily disputed in the pleadings. As a consequence of the dispute created on the papers, a review application was referred to oral evidence. The first respondent had advised that it would be calling witnesses, who were not ultimately called. This conduct justified the costs order.

In Borain and Another v Minister of Safety and Security (KZD) (unreported case no 16735/06, 28-11-2011) (Murugasen J) the court stated at para 67:

‘There is a responsibility to the public at large, from whose contributions the awards and costs of applications of this nature are paid, that matters in which an organ of state is sued be adjudicated in a court of law to establish liability and the degree thereof, and for a fair and equitable assessment of quantum.’

This statement as a general rule cannot be accepted as correct. There will be cases where a matter should be adjudicated. However, this approach will not apply in matters where there should be settlement and where the facts are not in dispute. The statement in the Borain case is contrary to the decisions of Ngxuza and Njongi.

In Quinella Trading (Pty) Ltd and Others v Minister of Rural Development and Others 2010 (4) SA 308 (LCC) Meer J stated at para 34:

‘Respondents have in my view conducted this case in a manner deserving censure, by means of a special order for costs to be taxed as between attorney and client. Respondents’ disregard for their financial obligations under the contracts, their attempts to escape same by disputing the validity of the agreements, and their resort to spurious and unsubstantiated allegations of lack of funds, can be characterised as vexatious, reckless and reprehensible, and deserving of censure.’

Applying fairness to questions of the quantum of settlements is difficult. On the one hand, it is in the state’s interests to settle for an amount as low as possible. On the other hand, there is a possibility of the state’s opponent being deprived of what is fair or due (JB Weinstein and GA Crosthwait: ‘Some reflections on conflicts between government attorneys and clients’ [1985] 1(1) Touro Law Review at 1). A balance between the two interests must be maintained. Thus the approach taken where an opponent is represented by an experienced representative would be different to the situation where the representative is clearly inexperienced or where the other party is undefended.

Professional ethics

Moral and policy considerations must be taken into account in all aspects of litigation involving the state (Njongi at para 64).

In Australia it has been held that the model litigant guidelines, contained in Appendix B of the Legal Services Directions 2005 made under s 55ZF of the Judiciary Act 1903, do not affect substantive rights such as the right to recover costs. It has also been argued that they do not have external effect and a failure to act as a model litigant is not a basis for refusing the Commonwealth or any of the Australian states their costs (see C Peadon ‘What cost to the Crown a failure to act as a model litigant?’ (2010) 33 Australian Bar Review 239).

I submit that the position in South Africa is not the same. The duty to act fairly applies, in my view, both substantively and procedurally. The duty does not relate merely to an internal mechanism to ensure compliance therewith. By virtue of the constitutional principles involved, the duty to act fairly is enforceable by both the court and the litigant involved in litigation against the state.

Certain provisions of s 195(1) of the Constitution also affect the role of the state or department of state in litigation (Botha at para 11).

In terms of s 195(1)(a), a high standard of professional ethics must be promoted and maintained. In terms of s 195(1)(b) and (f), the promotion of efficient, economic and effective use of resources is required and the public administration must be accountable. Unnecessary litigation is therefore excluded by these provisions.

The court in MEC for Social Development v Mdodisa (SCA) (unreported case no 578/09, 22-9-2010) (Navsa JA) stated at para 1:

‘This appeal is a tale of maladministration and wasteful expenditure.’

And, at para 20:

‘[C]ounsel for the [member of the executive council (MEC)] properly conceded that the court below correctly delivered their decision to terminate the grant to be invalid and of no force or effect. In the light of that concession we inquired from counsel why the MEC persisted in the appeal.’

At para 23 the court further stated:

‘The department for which the MEC is responsible has behaved peculiarly, both in relation to the manner in which the disability grant was dealt with and in the litigation that followed. The present appeal was as unnecessary and unmeritorious as the preceding litigation. Both, it must be added, at huge cost to the South African taxpayer, with no prospect, as the MEC’s counsel conceded, of ever recovering any of the costs from a lay litigant who was asserting her right to fair administrative action.’

In Naude v MEC, Department of Health, Mpumalanga (2009) 30 ILJ 910 CJ Musi AJ stated at para 115:

‘The applicant has been successful. The litigation could have been avoided. The applicant tried in various ways to avoid the litigation. The applicant went through considerable lengths to affirm his rights not to be discriminated against. The respondent as a representative of the people has a duty to adhere to the tenets of the Constitution. She has not done so. She has frequently violated the Constitution and [the Labour Relations Act 66 of 1995]. It would only be fair and equitable that the respondent pay the applicant’s costs’ (my emphasis).

In terms of s 165(4) of the Constitution, organs of state, which include a department as a party to litigation, must assist and protect the court to ensure the independence, impartiality, dignity, accessibility and effectiveness of the courts. By virtue of the duty to ensure accessibility of the courts, the department has a duty to ensure that other parties to litigation have such access.

In Von Abo v Government of the Republic of South Africa and Others (TPD) (unreported case no 306/2007, 29-7-2008) (Prinsloo J) the court held that the failure of the respondents to file affidavits personally and the reliance on hearsay allegations amounted to a failure to comply with s 165(4).

Notwithstanding a department conceding the unconstitutionality of a law, the Constitutional Court still requires the assistance of such department or relevant organ in order for it to come to a proper decision and also requires reasons why such a concession was made. This, according to the Constitutional Court, constitutes a duty in terms of s 165(4) of the Constitution (South African Liquor Traders’ Association and Others v Chairperson, Gauteng Liquor Board, and Others 2009 (1) SA 565 (CC)).

In Cele v South African Social Security Agency and 22 Related Cases 2009 (5) SA 105 (DCLD) the state attorney was commended for assisting the court in arriving at an appropriate order with regard to applications brought to court by beneficiaries of social grants that clogged court rolls over time.

A higher standard for government attorneys?

While legal practitioners in private practice have duties to both the court and their opponents, such duties do not go as far as the duties owed by the government in litigation.

The government has a duty to be fair to its opponent, and honest and forthright with the court, even to the extent of advising of shortcomings in its case.

Certain American and Canadian courts have held government attorneys to a higher ethical standard than their counterparts in private practice. In Freeport-McMoran Oil and Gas Company v Federal Energy Regulatory Commission 962 F. 2d 45 Mikva CJ stated at para 10:

‘A government lawyer “is the representative not of an ordinary party to a controversy”, the Supreme Court said long ago in the statement chiselled on the walls of the Justice Department, “but of a sovereignty whose obligation … is not that it shall win a case, but that justice shall be done”. The Supreme Court was speaking of government prosecutors … but no one, to our knowledge … has suggested that the principle does not apply with equal force to the government’s civil lawyers.’

The same view was expressed in Douglas v Donovan 704 F.2d 1276, where the court stated that ‘government attorneys … have special responsibilities to both this court and the public at large’.

In Silverman v Ehrlich Beer Corporation 687 F. Supp 67 (1987) a higher ethical standard for government lawyers was suggested to offset the potential for government attorneys to wield the enormous power behind their positions to the detriment of justice. At pages 69 and 70 the court stated:

‘[A]n attorney in the employ of the government is not on the same footing as a private attorney … . [T]he economic power in the hands of some individual government lawyers can wreak total devastation on the average citizen. As a result, the attorney representing the government must be held to a higher standard than that of the ordinary lawyer.’

However, in Lybbert v Grant County State of Washington, the Supreme Court of Washington 141 Wn.2d 29, 1 P.3d 1124 (2000) stated:

‘While we agree with the basic proposition that the government should be just when dealing with its citizens, we do not believe that an attorney representing the government has a duty to maintain a standard of conduct that is higher than that expected of an attorney for a private party.’

In the Canadian case of Everingham v Ontario 84 DLR (4th) 354, at 359H to 360D, Borins J stated that government attorneys must be particularly sensitive to the rules that govern professional conduct as they have a higher obligation than other lawyers; they assume a public trust as a government is responsible to the people. Each part of the government has the obligation to carry out in the public interest its assigned responsibility in a manner consistent with the applicable laws and regulations and the Charter of Rights. While private lawyers represented their clients’ personal or private interests, the government lawyer represented public interests. He was required to take into account the public interest sought to be served by the respective government department or agency. However, the court on appeal specifically did not agree with this statement (Everingham v Ontario (1992) 88 DLR (4th) 755 at 760F to 761C).

A higher standard was also expressed in 178 4049 Ontario Ltd (Lob Alpha Care Studio 45) v Toronto (City) 2010 ONSC 1204 at para 39.

In the Australian case of Kenny v South Australia [1987] 46 SASR 268 at 273 the court stated that the Crown Solicitor’s office must set an example to the legal profession as to ‘conscientious compliance with procedures designed to minimise cost and delay and to make maximum use of resources’. The model litigant policy also emphasises a higher standard for government lawyers than that required of private practitioners. In terms thereof, acting for the government might ‘require more than merely acting honestly and in accordance with the law and the court rules. It also goes beyond the requirement for lawyers to act in accordance with their ethical obligations.’

There is not, I suggest, a higher ethical duty on state attorneys than on their counterparts in private practice. While state attorneys are subject to the same common law and law society ethical rules, they are, by virtue of being public officials and part of an organ of state (the Office of the State Attorney), subject to rules that are not applicable to private practitioners. It is these that can be enforced by the courts. This is not to say, however, that by virtue of these additional duties a higher standard is expected of them. A high standard is expected of all attorneys.

Ian Gough BCom LLB (Rhodes) LLM (UKZN) is a state attorney in Bloemfontein.

This article was first published in De Rebus in 2012 (May) DR 42.