The law reports – July 2020

July 1st, 2020
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May 2020 (3) South African Law Reports (pp 1 – 323); May 2020 (1) South African Criminal Law Reports (pp 449 – 559)

This column discusses judgments as and when they are published in the South African Law Reports, the All South African Law Reports and the South African Criminal Law Reports. Readers should note that some reported judgments may have been overruled or overturned on appeal or have an appeal pending against them: Readers should not rely on a judgment discussed here without checking on that possibility – Editor.

 

Abbreviations:

ECG: Eastern Cape Division, Grahamstown
FB: Free State Division, Bloemfontein
GJ: Gauteng Local Division, Johannesburg
GP: Gauteng Division, Pretoria
LT: Limpopo Local Division, Thohoyandou
ML: Mpumalanga Local Division, Middelburg
SCA: Supreme Court of Appeal
WCC: Western Cape Division, Cape Town

 

Attorneys

Is work done by an attorney who lacks a Fidelity Fund Certificate at the time of doing the work null and void? The litigation in NW Civil Contractors CC v Anton Ramaano Inc and Another 2020 (3) SA 241 (SCA) stemmed from a dispute between the parties over legal fees that the first respondent attorneys’ firm maintained was owed to it by the appellant.

It appeared that the appellant’s attorney, one Nange, had prosecuted an application for the appellant, and obtained favourable orders against the first respondent in the LT. However, at the time of so acting, Nange was not in possession of a valid Fidelity Fund Certificate.

Relevant to the case was s 41(1) of the Attorneys Act 53 of 1979 (the Act), which provides that: ‘A practitioner shall not practise … unless he is in possession of a Fidelity Fund Certificate’.

The first respondent approached the LT, which set aside the judgment the appellant had obtained there. In the court’s view, absent a Fidelity Fund Certificate, all work done in the matter, including drafting of the notice of motion, was rendered null by the contravention of s 41(1). This meant that the notice of motion, and the orders based thereon, requiring setting aside.

The first respondent then appealed to the SCA. The SCA per Ponnan JA (Swain JA, Zondi JA, Mocumie JA and Dolamo AJA concurring) set aside the LT’s decision on the ground that its orders were impermissibly vague, and thus contravened the principle of the rule of law; and also on the basis that while a contravention of s 41(1) disentitled an attorney from getting his fee and rendered him guilty of an offence, the work done by the attorney was not rendered null since this was not what was contemplated by the Act. The SCA ruled that the legislature’s intention in enacting s 41 was no more than to punish attorneys who did not comply with it. It held that a contrary reading would undermine the primary purpose of the Act, which was to protect the public, and would have grave consequences for the administration of justice, the rule of law and legal certainty. The SCA accordingly upheld the appeal with costs.

 

Children

School admission policy excluding ‘undocumented’ learners: In Centre for Child Law and Others v Minister of Basic Education and Others 2020 (3) SA 141 (ECG), the matter concerned the validity of a 2016 policy change introduced by the Department of Education, Eastern Cape, to withhold funding for learners without valid identity or passport numbers. This decision effectively resulted in the exclusion of such ‘undocumented children’ from school and from being funded if they remained at school.

Various issues were touched on, however, on the issue of its constitutionality the ECG, per Mbenenge JP (Schoeman J and Mfenyana AJ concurring), held that the policy was inconsistent with, inter alia, the right to basic education, which extended to all within South Africa’s borders, irrespective of immigration status. A further issue was the ambit of Immigration Act 13 of 2002’s prohibition on training or instruction of illegal foreigners by learning institutions (in ss 39(1) and 42), more specifically whether it applied to illegal foreign children. The court held that it did not.

 

Contract

Clause in settlement agreement ruled contrary to public policy: In Standard Bank of South Africa Ltd v Bloemfontein Celtic Football Club (Pty) Ltd 2020 (3) SA 298 (FB) the facts were that, in July 2015, Standard Bank (the Bank) entered into six home loan agreements with Bloemfontein Celtic Football Club (the Club). Mortgage bonds were registered over all six properties and registered in favour of the Bank even though the Club had no assets, no bank account, no income tax registration number and no financial statements. Shortly afterwards the Club defaulted, and on 2 August 2018 the Bank instituted liquidation proceedings. The Club filed a notice of intention to oppose. The parties then entered into a settlement agreement under which they agreed that if the Club failed to make certain payments, the Bank would be entitled to re-enrol the liquidation application on an unopposed basis. When the Club subsequently defaulted on its obligations under the settlement agreement, the Bank proceeded with a liquidation application as foreshadowed in the settlement agreement. The Club argued that the term in question was contrary to public policy and, therefore, void.

The FB, per Musi JP, ruled that the disputed term fell squarely into the category of offensive and unconscionable agreements, while at the same time having the tendency to deprive the Club of its constitutional right of access to the courts. The FB further pointed out that it made no difference that the Club was a company, not a person, since both sequestration and liquidation involved a change of status. Since the disputed term was void for being contrary to public policy, the Bank was not entitled to fall back on the original notice of motion to seek the Club’s liquidation. The application was dismissed with costs.

 

Impossibility of performance:  In Frajenron (Pty) Ltd v Metcash Trading Ltd and Others 2020 (3) SA 210 (GJ) a lessee defended a lessor’s contractual claim for the return of leases premised, on the basis that it was impossible to do so because the party to whom it had been sublet refused to vacate it. In considering this defence, the GJ, per Valley J, discussed the development in South Africa of the principle that impossibility of performance was a legally permissible basis for discharging a party from performing its contractual obligation.

The court summarised the state of the law as follows: If a person was prevented from performing under their contract by certain events, vis major or casus fortuitus, they were discharged from liability as such events were not confined to acts of nature only, they included any event that may be caused by human agency, as long as it was ‘unforeseeable with reasonable foresight and unavoidable with reasonable care’. No party was allowed to rely on an impossibility caused by their own act or omission (there should be no fault or neglect on their part in the creation of the impossibility). The impossibility had to be absolute and not relative; and it had to be applicable to everyone and not personal to the defendant, therefore, it had to be objective.

The GJ ruled that the impossibility of performance rule did not rescue the defendant from the consequences of its breach. It was their own initial misconduct in subletting the property that prevented it from restoring possession to the plaintiff. It did not matter that the defendant took steps to evict the sub-lessee but had been stymied by the slowness of the legal process. The delay was foreseeable and avoidable, and did not entail impossibility of performance.

 

Credit agreements

Whether collections costs include legal fees: The background to University of Stellenbosch Law Clinic and Others v National Credit Regulator and Others 2020 (3) SA 307 (WCC) was the widespread problem affecting consumers – particularly those, who were often the poorest members of society, who had entered into small or microloans – of their debts under a credit agreement spiralling far beyond the initial debts incurred, owing to the credit provider’s escalating legal fees being passed onto them.

In terms of s 103(5) of the National Credit Act 34 of 2005, the various costs of credit, which are allowed to be charged under a credit agreement in terms of s 101(1)(b) – (g) cannot in aggregate exceed the unpaid balance of the principal debt as at the time the default occurred. Such allowable costs of credit include ‘collection charges’ (as defined in s 1) and amounts ‘that may be charged by a credit provider in respect of enforcement of a consumer’s monetary obligations under a credit agreement, but does not include a default administration charge’. Collection costs are subject to a further limitation as provided in s 101(1)(g), in that they cannot exceed ‘the prescribed maximum for the category of credit agreement concerned’.

The issue, on a more technical level, was whether ‘collection costs’, given the broad language used in the section, was to be read as including all legal fees incurred to enforce the monetary obligation under the credit agreement, whether charged before, during, or after litigation. If legal fees were subject to these caps, the problem of spiralling debts would potentially be alleviated. Such an interpretation, the applicants argued, was demanded given the purpose of the provisions in question, namely to protect the consumer, especially the poor, and would promote responsible lending practices (another of the purposes of the Act) by encouraging credit providers to vet clients properly.

The court, per Hack AJ, agreed and declared, inter alia, that legal fees, including fees of attorneys and advocates – in as much as they comprised part of collection costs as contemplated in s 101(1)(g) of the Act – may not be claimed from a consumer or recovered by a credit provider pursuant to a judgment to enforce the consumer’s monetary obligations under a credit agreement, unless they were agreed to by the consumer or they had been taxed.

 

Criminal law

Police refusal to prevent criminal activity during protest action without prior court order censured: The case of Impangele Logistics (Pty) Ltd and Another v All Truck Drivers’ Foundation and Others 2020 (1) SACR 536 (ML) concerned two separate applications, similar in nature, that emerged out of violent unlawful protest actions. The applicants approached the court seeking orders restraining the main respondents –

  • from unlawfully damaging, obstructing, and interfering in the business conducted by Imbali Coal Mine;
  • restraining and interdicting the respondents from impounding, detaining or obstructing in any manner whatsoever the vehicles belonging to Impangele Logistics; and
  • restraining the respondents from intimidating, harassing, threatening or attacking any of the applicants’ employees.

Six police stations were also cited as respondents and the applicants sought orders compelling the police to assist in the enforcement of the orders. The particular police stations were cited because when the applicants had sought assistance from them to prevent unlawful conduct by the various groups of protesters, they had refused to intervene until the court directed them to do so. The applicants had provided the court with clear evidence of the commission of criminal activities including assault, robbery, hijacking, malicious damage to property, unlawful detention of vehicles, blockage of public roads and inciting violence, in which the police had failed to intervene.

The relief was granted but the court was compelled to comment that this was not the first time that it had been confronted with such a response by the South African Police Service. It noted that when matters deserving the maintenance of public order by the police were reported, an immediate response was required.  It was entirely lacking on the part of the police not to act when criminal activity was reported to them. For parties to have to seek an order of court before action was taken on criminal activity would only serve to bring the criminal justice system into disrepute. In response to a request from the applicants that the station commanders ‘be encouraged by the Honourable Court to perform their duties’, the court cautioned of the need to be mindful of the separation of powers. It emphasised that it was not the responsibility of the courts to prevent, combat or investigate crimes and neither was it its function to maintain public order, secure the inhabitants and their property. That was a power and authority constitutionally bestowed on the police in terms of s 205 of the Constitution and it was for the police to ensure that they did what the Constitution obliged them to do. It was, however, the function of the provincial commissioner to encourage them to perform their duties. For this reason, therefore, the court instructed the registrar to bring the judgment to the attention of the Mpumalanga Provincial Commissioner who was to consider whether to institute an inquiry, to consult with the applicants’ legal practitioners for the purpose of fully addressing the complaints raised and to take measures to avoid recurrence of similar complaints in the future.

 

Damages – Road Accident Fund (RAF)

Should any heed be paid to the RAF’s liquidity in such an assessment? The matter of Malatji v Road Accident Fund 2020 (3) SA 236 (GP) involved a plaintiff who was a married woman who had a son. She was employed as a facility maintenance co-ordinator and was actively involved in her church. At the age of 40, her spine was injured in a motor vehicle accident, and she was rendered quadriplegic and incapable of living independently. She was permanently bound to her wheelchair, and suffered from incontinence, depressive episodes and a loss of sexual activity. According to the court, she had been rendered as a spectator of life.

The plaintiff sued the RAF for damages, and the issue before the GP was the amount of her general damages, which in this context referred solely to her non-patrimonial loss, the aim of which was said to be an attempt to neutralise that loss through the fact that a money payment might bring the plaintiff happiness, contentment or comfort or assist her in some other way to overcome the loss and trauma she had suffered as a result of the accident. The amount awarded was at the discretion of the court, but it had to be guided by awards made in comparable cases. The GP, per Van der Schyff AJ, pointed out, however, that no monetary award could undo the plaintiff’s loss, and that it was obliged to take judicial recognition of the fact that the RAF was for practical purposes insolvent. A responsible approach would, therefore, consider the plaintiff’s interests and the aim and purpose of the award with the public interest, which included the protection of the liquidity of the RAF. The GP proceeded to award an amount of R 2,65 million to the plaintiff.

 

Delict

Action for assault: Onus and duty to begin: In 1981 the Appellate Division in Mabaso v Felix 1981 (3) SA 865 (A) established the Mabaso principle that, in delicts affecting a plaintiff’s personality and bodily integrity, the onus was on the defendant to prove excuse or justification, such as for example, self-defence. Assault was one such delict.

In November 2019 the Mabaso principle came to the fore in Merryweather v Scholtz and Another 2020 (3) SA 230 (WCC). The facts were that Merryweather and Scholtz were in the early hours of 9 September 2006 involved in a group brawl between several young men and a subsequent altercation between Scholtz and Merryweather that left Merryweather paralysed. Merryweather sued Scholtz for damages, claiming that Scholtz had assaulted him by ‘grabbing and pushing, kicking and punching him and throwing and/or spear-tackling him against a stationary motor vehicle’. In his plea Scholtz denied the allegations but added, ‘without derogating from the [above] denial’, that Merryweather had ‘hit’ and ‘grabbed’ him, and that he had then ‘pushed [Merryweather] to get [Merryweather] off him’. Scholtz also specifically denied that he ‘threw or tackled [Merryweather] against a motor vehicle’ or ‘pushed [him] off his feet’ or ‘intended [him] to lose his footing’. The court was called to make a preliminary ruling on the duty to begin and the onus of proof.

Counsel for Merryweather argued that Scholtz’s plea was one of confession and avoidance and that he, therefore, attracted the onus, in accordance with the Mabaso principle, of proving self-defence. Counsel argued that the statement in Scholtz’s plea that he had ‘pushed [Merryweather] away’ was an admission of assault, and that the fact that he did not admit to the exact type of assault alleged in the particulars was irrelevant. Counsel for Scholtz in turn argued that since Scholtz did not admit material aspects of the assault alleged by Merryweather, his plea was not one of confession and avoidance that triggered Mabaso. Counsel for Scholtz further pointed out that Scholtz specifically denied kicking or punching Merryweather, that he threw or spear-tackled Merryweather against a car, or intended Merryweather to lose his footing. Counsel stressed that Scholtz had stated in amplification of his plea that contact between himself and Merryweather was not initiated by him and that he had acted to ward off acts directed against himself.

In its judgment the WCC, per Meer J, ruled that Scholtz’s admission in his plea that he had pushed Merryweather in self-defence was an admission to an assault, though not the precise assault described in the particulars. Meer J pointed out that this admission and invocation of self-defence put Scholtz within the ambit of the Mabaso principle as outlined above, notwithstanding the factual disputes as to the exact type of assault perpetrated by Scholtz. Therefore, the admission of assault was sufficient for the Mabaso principle to apply, even though the admitted assault did not mirror the details described by Merryweather. It did not matter that the assault described in the particulars was a spear-tackle and the assault admitted to in the plea was a push in self-defence to avert an attack. Since his plea was one of confession and avoidance, he bore the onus set out in Mabaso and had the duty to begin.

 

Immigration

May an asylum seeker marry a South African citizen, and may an individual conclude both a civil and customary marriage with another individual? The case of Mzalisi NO and Others v Ochogwu and Another 2020 (3) SA 83 (SCA) concerned an asylum seeker (first respondent) whose application for asylum had been refused. His appeal of that refusal was pending. The first respondent married a South African citizen under customary law, and he and his wife (second respondent), had approached the Department of Home Affairs (the Department) to register that marriage, as well as to solemnise a civil marriage. The Department refused the application on the basis of a circular, which provided that refugees ‘whose asylum seeker application status is pending cannot contemplate marriage’ and ‘should there be an inquiry [into] a refugee or asylum seeker status the marriage cannot be concluded’.

The first and second respondents then obtained a declaration from the GP that the paragraph containing these provisions was inconsistent with the Constitution and invalid to the extent that it barred them registering their customary marriage and solemnising a civil marriage. The GP set the paragraph aside. The Department appealed to the SCA. It confirmed that the provisions were invalid on the ground that they limited the rights to freedom and security of the person, and dignity. The SCA, per Petse DP (Tshiqi JA, Wallis JA, Mbha JA and Dlodlo JA concurring), also considered the assertion of the Department, that the High Court’s order was incompetent in declaring a right to conclude a civil marriage and directing registration of the customary union.

The SCA finally also rejected the Department’s contention that it was impermissible to be married both civilly and customarily at the same time, pointing out that, correctly interpreted, the Recognition of Customary Marriages Act 120 of 1998, s 10(1) and 10(4) allowed it.

 

Lease

The termination of a lease for an undetermined period: The case of Sharma v Hirschowitz and Another 2020 (3) SA 285 (GJ) answered the question whether, when a tenant remained on leased premises with the landlord’s consent after the expiry of the lease, they could orally agree to increase the further rental payable.

The facts were that the appellant, as tenant, had rented the property from the respondents. On the expiry on 27 February 2014 of a written renewal lease agreement entered into between them, the parties orally agreed that the appellant would be allowed to remain on the property at an increased monthly rental amount. The appellant paid the increased rent for the months March to October 2014. The respondents gave notice to the appellant to vacate the property effective, October 2014. The appellant, however, stayed on until 26 February 2015, having only paid further rent at the increased rate for the months of November and December 2014. The respondents proceeded to sue the appellant in the Randburg Magistrates’ Court for cancellation of the lease agreement and payment of damages for holding over, as well as payment of water and electricity consumption charges. The appellant counterclaimed for payment of his rental deposit plus interest. The magistrates’ court granted cancellation and found that the respondents were entitled to holding-over damages. It also dismissed the respondents’ claim for utilities, as well and the appellant’s counterclaim.

The appellant appealed to the GJ. While accepting that he had held over for the period claimed, he disputed the amount of damages to which the respondents were entitled. He also argued that the magistrate should have found that oral lease renewal agreement was invalid under s 5(5) of the Rental Housing Act 50 of 1999, which provides that ‘on the expiration of the lease the tenant remains in the dwelling with the express or tacit consent of the landlord, the parties are deemed, in the absence of a further written lease, to have entered into a periodic lease, on the same terms and conditions as the expired lease’.

The GJ ruled that s 5(5) was only an evidentiary tool aimed at facilitating the proof of matters in which there was no written agreement. Absent writing, the renewed lease was ‘deemed’ to be the same as the previous one. Such deeming was, however, rebuttable. Since it was common cause that the oral agreement was concluded and implemented, the deeming provision was thereby rebutted and the rental due under the oral agreement rendered an enforceable obligation. The GJ accordingly upheld the appeal.

 

Other cases

Apart from the cases and material dealt with or referred to above, the material under review also contained cases dealing with –

  • civil proceedings in magistrate’s court;
  • compensation claim against the road accident fund;
  • dismissal for operational requirements;
  • evidence – subpoena dues tecum;
  • instalment sale agreement;
  • production of documents and legal professional privilege;
  • rights and duties of attorneys; and
  • witness giving evidence via video link.

Gideon Pienaar BA LLB (Stell) is a Senior Editor, Joshua Mendelsohn BA LLB (UCT) LLM (Cornell), Johan Botha BA LLB (Stell) and Simon Pietersen BBusSc LLB (UCT) are editors at Juta and Company in Cape Town.

This article was first published in De Rebus in 2020 (July) DR 28.