The Law Reports – May 2023

May 1st, 2023
x
Bookmark

March 2023 (2) South African Law Reports (pp 1 – 319); March 2023 (1) South African Criminal Law Reports (pp 235 – 242)

This column discusses judgments as and when they are published in the South African Law Reports, the All South African Law Reports, the South African Criminal Law Reports and the Butterworths Constitutional 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

CAC: Competition Appeal Court
CC: Constitutional Court
CT: Competition Tribunal
ECEL: Eastern Cape Division, East London Circuit Court
ECMk: Eastern Cape Division, Makhanda
GJ: Gauteng Local Division, Johannesburg
GP: Gauteng Division, Pretoria
SCA: Supreme Court of Appeal
WCC: Western Cape Division, Cape Town

Competition

Inferential proof of cartel conduct: The Competition Commission referred a complaint to the CT that Aranda Textile Mills, a manufacturer of blankets, and Mzansi Blanket Supplies, which supplied blankets sourced from Aranda, had, contrary to s 4(1)(b)(i) and (ii) of the Competition Act 89 of 1998 (the Act), engaged in cartel conduct by submitting collusive bids in response to a government tender. Instead of relying on direct evidence, the Commission relied on the bid prices, which showed a consistent 7,25 % markup by Mzansi on Aranda’s prices. According to the Commission this was evidence of collusive tendering. The CT, adopting the same inferential reasoning, agreed with the Commission’s finding. Aranda and Mzanzi appealed to the CAC. They denied colluding and argued that their interactions were in pursuance of bona fide arm’s length business transactions.

In its judgment, reported as Aranda Textile Mills (Pty) Ltd and Another v Competition Commission 2023 (2) SA 182 (CAC), the CAC (per Victor JA, Mnguni AJP and Kathree-Setiloane AJA concurring) found that cartel conduct could be inferred in absence of direct evidence but not in disregard of it. The Tribunal had ignored most of the appellants’ direct evidence while cherry-picking the bits that supported its hypothesis of cartel conduct. The CAC emphasised that inferential reasoning required an evaluation of all the evidence, not merely selected parts, and that the inference sought to be drawn had to be consistent with all the proved facts. The CAC held that, since there had been no basis for the Tribunal to conclude that Aranda and Mzansi had fixed a price for the tender or that there had been collusive dealings between Aranda and Mzansi, the appeal had to succeed.

Criminal law

Sentencing: A cultural practice that involves criminal conduct is not per se mitigatory: In S v ZB 2023 (1) SACR 298 (WCC) the appellant appealed against her sentence of 12 years’ imprisonment for human trafficking for sexual purposes in contravention of s 71(1) of the Criminal Law (Sexual Offences and Related Matters) Amendment Act 32 of 2007 (the Act), of her 15-year-old niece.

The complainant lived with the appellant who had become her guardian on the loss of her father. The appellant arranged for the complainant to be sent away to live with a much older man where she was repeatedly raped, assaulted, and kept captive by her purported husband. The state contended that the appellant facilitated those offences, and she was convicted in accordance with the application of the overarching provisions set out in the Act.

The appellant’s argued for a reduced sentence on the ground that her cultural background was a strong mitigating factor in assessing her overall moral blameworthiness. She contended that, overall, a non-custodial sentence would be more appropriate.

The WCC (per Fortuin J and Wille J) noted that the sentence imposed on the appellant had in some measure to reflect censure on the appellant’s conduct and behaviour, and that it was unable to find any misdirection or irregularity on the part of the court in this regard. The appellant’s children were in the care of her sister and her husband, who was also their breadwinner, and they, therefore, would be adequately cared for if the appellant was incarcerated. A non-custodial sentence would also not be a good example to set in connection with the person who had been convicted of human trafficking of a minor for sexual exploitation, and to allow her to return home to her minor children would possibly in itself be detrimental to her children’s upbringing. As to the mitigating effect of the cultural practices alluded to by the appellant, the WCC was firmly of the view that cultural practices that constituted criminal conduct in the law did not per se mitigate the perpetrator’s conduct for sentencing purposes. It had to be so. To hold otherwise would undermine the equality of all individuals before and under the law, a crucial constitutional value. This was also of particular significance in the context of gender-based violence, and all women were entitled to the same level of protection from their abusers. The appeal, therefore, had to be dismissed and the sentence confirmed.

Other criminal law cases

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

  • arrest without warrant on reasonable suspicion;
  • duties of the presiding officer in respect of the trial record;
  • extradition;
  • housebreaking: composite charges;
  • murder: premeditated or planned murder;
  • murder: sentence of life imprisonment;
  • rape: sentence of life imprisonment;
  • sentence: proof of previous convictions;
  • sentence: the putting into operation of suspended sentences; and
  • the absence of the presiding officer from a trial.
Delictual damages

‘Once and for all rule’ again challenged: The tenth to 85 respondents in MEC for Finance, Eastern Cape and Others v Legal Practice Council and Others 2023 (2) SA 266 (ECMk) were successful plaintiffs in medical negligence claims against the third applicant, the Member of the Executive Council for Health, Eastern Cape Province (the MEC). When the judgments they had obtained remained unsatisfied, several of the plaintiff respondents caused writs of execution to be issued for the attachment of the rights, title, and interest of the MEC and the fourth applicant, the Head of Department for Health, Eastern Cape (the HOD Health), in its Paymaster General account.

The applicants, including the first applicant and the Premier of the Eastern Cape Province as fifth applicant, applied for relief amounting to an interim interdict staying execution pending finalisation of the application for variation of the orders in favour of the respondent plaintiffs. Citing financial constraints, they contended that payment of the existing judgment debts may lead to the total collapse of health services in the Eastern Cape. The requested variation was to amend the dates of payment in the court orders in favour of the plaintiff respondents, to provide for various amounts to fall due as set out in a proposed schedule of instalments. The applicants contended that they were entitled to this variation permitting for payment of the judgment debt in instalments, by the development of the common law in respect of the ‘once and for all’ rule.

The Full Bench of the ECMk (per Beshe J, Eksteen J and Laing J) – in holding that the application was ill-advised and would be dismissed on a number of grounds – held in respect of the once and for all rule, that while the CC had given a clear indication of the likely development of the common law in this field, the CC had also emphasised that ‘each [individual] must be afforded an appropriate remedy and compensated fairly for the loss suffered’. The prayer for periodic payments constituted a special defence to the ‘once and for all’ rule, which must be properly pleaded. Evidence must be led to substantiate the defence and the court must, after consideration of all the relevant evidence, craft an appropriate remedy for the individual plaintiff. The contended for development of the common law, was a matter for trial. It could not be raised after the issues had been finally decided, simply because the applicants were in a financial pinch.

Gambling

The legality of new Broad-Based Black Economic Empowerment condition imposed for renewal of licenses: Tsogo Sun Caledon (Pty) Ltd and Others v Western Cape Gambling and Racing Board and Another 2023 (2) SA 305 (SCA) concerned an appeal to the SCA against the High Court’s dismissal of the appellants’ application to review the respondent’s decision to impose a new condition under the applicable Broad-Based Black Economic Empowerment (B-BBEE) framework in respect of their casino licences.

The first to third appellants held casino licences authorising them to operate casinos in the Western Cape, and the fourth appellant held a route operator licence by which it was authorised to operate a limited-payout machine business in the Western Cape Province. The respondents were the Western Cape Gambling and Racing Board (the Board) and its chairperson.

The Board had adopted Codes of Good Practice, first in 2007 and then in 2013, under the Broad-Based Black Economic Empowerment Act 53 of 2003 (the B-BBEE Act) to which all gambling licenses in the province were subject. On 13 July 2017, licensees were notified of the new condition, requiring them to achieve an overall rating of level 4 and to submit documentation related to this to the Board.

It was uncontested that prior to the impugned decision, the appellants had voluntarily exceeded the level, which the respondent sought to impose in the new condition. What was challenged was whether the new conditions met the requirements of s 53(2)(b) of the National Gambling Act 7 of 2004 for the exercise of the power to impose conditions on the appellants.

Section 53(2)(b) provides that ‘[a]t least once every year after the issuance of a licence … the provincial licensing authority that issued that licence –

(b) may impose further or different reasonable and justifiable conditions on the licence to the extent necessary to address the matters referred to in subsection (1)(a) and (b).’ And subs 1)(a) provides that ‘[w]hen considering an application for a licence … a provincial licensing authority –

(a) must consider the commitments, if any, made by the applicant or proposed transferee in relation to –

(i) black economic empowerment’.

The SCA held that there was a four-stage process, which must take place in imposing further or different conditions under s 53(2), none of which was implemented by the Board. Instead, the Board had elevated what was really a policy into an immutable rule which it applied indiscriminately to all licence holders, regardless of their circumstances. Accordingly, the jurisdictional facts, which gave rise to the power of the Board to impose the conditions were not satisfied, and the imposition of the conditions was unlawful. The SCA accordingly upheld the appeal.

Government procurement

A delictual claim against a dishonest state organ? In October 2010, the Mopani District Municipality awarded a tender for the construction of a water pipeline. Esorfranki Pipelines (Pty) Ltd, an unsuccessful tenderer, having obtained the rescission of the tender on the ground of illegality, approached the GJ with a claim in delict for damages against the municipality but was rebuffed on the ground that it did not establish causation. Esorfranki’s subsequent appeal to the SCA was dismissed on the grounds, inter alia, that it did not establish factual causation or wrongfulness. It then applied to the CC for leave to appeal. In its judgment, reported as Esorfranki Pipelines (Pty) Ltd v Mopani District Municipality 2023 (2) SA 31 (CC), the CC delineated the issue before it as whether economic loss caused by intentional breach of s 217 of the Constitution – which requires fair, open, and cost-effective tendering processes – was recoverable in delict. The CC focused on the element of wrongfulness, pointing out that while some factors, such as the dishonesty of the municipality, went in its favour, another, namely that the Promotion of Administrative Justice Act 3 of 2000 (PAJA) provided for compensation as a species of just and equitable relief in such cases, went strongly against it. The CC emphasised that PAJA was constitutionally mandated legislation designed to give effect to the administrative justice requirement of s 33 of the Constitution in both substantive and remedial terms. A tenderer in the position of Esorfranki was, therefore, entitled, in appropriate circumstances, to recover its lost profits under PAJA. The CC concluded that the principle of subsidiarity – which provides that where legislation is enacted in order to comprehensively give effect to a constitutional right, a litigant cannot bypass the relevant legislation and rely directly on the Constitution or the common law – therefore, precluded it from allowing Esorfranki’s delictual claim.

Labour law

The legality of an ex post facto implementation of the ‘no work, no pay’ rule: Between 9 November and 15 December 2020, workers of the Amathole Municipality in the Eastern Cape went on an illegal (unprotected) strike. The municipality, under the mistaken impression that some of its workers had not joined the strike, paid them their full salaries despite the hiatus in services rendered. Having realised its mistake, the municipality belatedly (more than five months after the end of the strike) notified the workers in question that it would implement the ‘no work, no pay’ rule by deducting the mistakenly paid money from their future salaries. The affected workers (the applicants), complaining that they were afforded no hearing on the matter by the municipality, applied to the ECEL for an interim interdict prohibiting the municipality from making the deductions. The ECEL granted the interdict and the municipality paid back the sums it had already deducted. The applicants, however, insisted on final relief, which the municipality resisted on the ground that the payments were, in the light of the unlawfulness of the strike and the court-sanctioned implementation of the ‘no work, no pay’ rule, made in error and hence susceptible, without more, to set-off or deduction under s 34(5) of the Basic Conditions of Employment Act 75 of 1997 (BCEA). Section 34(5) states that: ‘An employer may not require or permit an employee to –

(a) repay any remuneration except for overpayments … resulting from an error in calculating the employee’s remuneration’.

In its judgment on the application for final relief, reported as Gqithekhaya and Others v Amathole District Municipality 2023 (2) SA 227 (ECEL) (Hartle J) ruled that the invocation of the ‘no work, no pay’ principle did not elevate a wage deduction for work not done to one ‘permitted in terms of a law’ as envisaged in s 34(1)(b) of the BCEA. The ECEL went to point out that the municipality should during the interim relief stage have asked the court for leave to deduct the renumeration it was entitled to withhold if the court found in its favour that the strike was unlawful. But mistaken payment would not entitle the municipality to recover the overpayment, five months after the fact, against present remuneration. Section 34 of the BCEA prohibited arbitrary deductions and s 34(5) could not be invoked without the employee’s consent or an order of court. The ECEL accordingly made an order declaring that the deductions effected against the applicants’ salaries amounted to unlawful self-help.

Motor vehicle accident claims

The legality of a Road Accident Fund (RAF) decision to cease paying medical claims if they were paid by a medical scheme: On 12 August 2022, the RAF issued an internal directive instructing its managers to reject all medical claims if a medical aid scheme had paid for them. The rationale behind the directive was that in such cases the claimants did not suffer any losses. Discovery Health, South Africa’s largest medical aid scheme, urgently approached the GP for an order rescinding the directive as unlawful. The directive was immediately implemented, resulting in a sudden and immediate cessation in settlements of all medical claims submitted by attorneys on behalf of member of medical schemes for the reimbursement of accident-related medical expenses. This was done without consulting or notifying medical schemes, their members, or attorneys.

In its judgment, reported as Discovery Health (Pty) Ltd v Road Accident Fund and Another 2023 (2) SA 212 (GP), the GP (per Mbongwe J) interdicted and restrained the RAF from implementing the directive. He pointed out that Discovery’s approach could not be more justified and that it was, in fact, coerced into litigation by the RAF, which had chosen to ‘go rogue’.

During his judgment Mbongwe J pointed out that the RAF functioned within the confines of the Road Accident Fund Act 56 of 1996, which obliged it to compensate, in full, the victims of vehicle accidents. Mbongwe J pointed out that the implementation of the directive would have driven medical schemes into bankruptcy forced claimants to abandon medical claims to avoid prescription and to settle their hospital bills out of funds received under other heads of damages.

Neighbour law

A nuisance claim concerning calls to prayer by an ‘extraordinarily sensitive complainant’: Madrasah Taleemuddeen Islamic Institute v Ellaurie and Another 2023 (2) SA 143 (SCA) concerned a nuisance claim pertaining to the issuing of five daily calls to prayer, the first at 3:30, by the appellant, the Madrasah Taleemuddeen Islamic Institute, a school for Islamic studies (the Madrasah) located in Isipingo Beach, south of eThekwini in the KwaZulu-Natal Province. The first respondent, Mr Ellaurie, resided approximately 20 metres away from the Madrasah and experienced the sounds as a detestable nuisance. He applied to the KZD for an interdict directing the Madrasah to stop issuing calls to prayer that were audible to him, alternatively that it ceases its operations altogether. He argued that the calls to prayer ‘invaded his personal space’ and robbed of the ‘quiet enjoyment of [his] property’ at an ‘unearthly time’. Other grounds he relied on reflected a detestation of the Islamic faith. He claimed that the sounds gave a ‘distinctly Muslim atmosphere to the area’ which many non-Muslim people allegedly found repugnant. The KZD (per Mngadi J) granted an order directing the Madrasah to ensure that the calls to prayer would not be heard in Ellaurie’s property. The Madrasah appealed to SCA.

The SCA, in a judgment penned by Dambuza ADP (Gorven JA, Hughes JA, Musi AJA and Daffue AJA concurring) held that under neighbour law only unreasonable interferences with the use and enjoyment of one’s property were prohibited. One factor in assessing the reasonableness of an interference would be the complainant’s sensitivity thereto: An interference would not be considered to be unreasonable when the harm or complaint about it arose from a special or extraordinary sensitivity on the part of a complainant: The first respondent’s profound dislike of Islam, the SCA held, made him an ‘extraordinarily sensitive complainant’, and accordingly the question of the reasonableness of the calls to prayer could not be judged by his standards. The SCA emphasised that he had placed scant evidence before the court to support a finding of unreasonableness according to the standards of the ordinary person living in Isipingo Beach.

The SCA deemed it necessary to address remarks made by the KZD to the effect that the freedom of religion guaranteed in the Constitution was no guarantee of the ‘practice or manifestations of religion’, and that, therefore, the Madrasah had to show that the calls to prayer were essential to its religion, and that all Ellaurie had to show was an interference with the enjoyment of his private space. The SCA disagreed, pointing out that the Constitution not only provided protection for different religious beliefs, but also guaranteed the freedom to observe and manifest those different religious beliefs. The rights of the appellant in this regard were relevant in an assessment of the interference of which the first respondent complained.

The SCA concluded that the appeal had to be upheld, and the judgment of the KZD set aside and replaced with an order dismissing the first respondent’s application.

SLAPP suits

Abuse of process? SLAPP, an acronym for Strategic Litigation Against Public Participation, was successfully raised as a defence in the WCC in Mineral Sands Resources (Pty) Ltd and Another v Redell and Others and Two Related Cases 2021 (4) SA 268 (WCC). There, defendants were environmental attorneys and community activists opposed to the mining activities of Australian mining company Mineral Sands Resources, which had sued the defendants for defamation. In their SLAPP defence the defendants successfully argued that the suit was aimed at intimidating them into silence and constituted an abuse of process. In an application for leave to appeal to the CC, now reported as Mineral Sands Resources (Pty) Ltd and Others v Reddell and Others 2023 (2) SA 68 (CC), the issue was whether such a species of abuse should be recognised in South Africa. Mineral Sands argued that motive should play no role in the inquiry whether the SLAPP defence could be accommodated in the abuse-of-process doctrine. Conversely, the respondents (the defendants in the WCC) submitted that the only criterion should be motive, and merits should play no role at all.

The CC held that both motive and merits played a role in the inquiry, and that ulterior purpose and a SLAPP defence ought not to be conflated. The CC pointed out that there were various kinds of abuse of process and that the characteristics of the SLAPP defence, which merited a place in our law, were more nuanced than that of ulterior purpose and also did not fall into the category of frivolous and vexatious proceedings, where the focus was on the nature of the case rather than the procedure employed. The CC held that the doctrine of abuse of process as it stood could accommodate the SLAPP defence. The respondents would have to prove at trial that the defamation suit brought by Mineral Sands –

  • was an abuse of process;
  • was not brought to vindicate a right;
  • amounted to the use of court process to achieve an improper end and to use litigation to cause the defendants financial and/or other prejudice in order to silence them; and
  • violated, or was likely to violate, the right to freedom of expression.

The CC emphasised that since a SLAPP defence required a consideration of both merits and motive, the respondent’s defence, based as it was on motive alone, lacked the averments necessary to satisfy the requirements of a successful SLAPP defence. The CC pointed out that while its finding that the SLAPP defence could be accommodated in the doctrine of abuse of process rendered it unnecessary to consider whether the common law ought to be developed, it was nevertheless up to Parliament to decide whether a more comprehensive, specific SLAPP-suit defence of the kind developed in Canada and the United States ought to be legislated for here. In its order the CC gave the respondents 30 days to amend their special plea to include the required averments.

Special execution

An application for the reconsideration of a reserve price: Can a court revisit the original order declaring residential property to be specially executable? In the matter of Nedbank Ltd v Mabaso and Another 2023 (2) SA 298 (GJ) the GJ (per Moultrie AJ) dealt with an application in terms of Uniform Rule 46A(9) for the reconsideration of a reserve price set in respect of immovable property declared to be specially executable. The applicant was Nedbank Ltd. It had obtained orders against the first respondent and the second respondent declaring their undivided shares in certain immovable property constituting their primary residence to be specially executable, and authorising execution thereon at a reserve price of R 596 305,99. A sale of the property by public auction was subsequently conducted by the Roodepoort South Sheriff. However, because the highest bid received was only R 300 000, namely below the reserve price, no sale took place. This fact prompted the applicant to approach the GJ in terms of r 46A(9)(c) for the variation of the previous orders to allow the property to be sold in execution without a reserve price. The second respondent opposed the application and sought to persuade the GJ to set aside the orders of special executability, being in a position since obtaining employment to make monthly payments of R 3 000 per month towards satisfying his debts to the applicant. In terms of the certificate of balance furnished by the applicant, the full (accelerated) amount of the respondents’ joint and several indebtedness to the applicant stood at R 681 543,18, including arrears amounting to R 212 614,49.

Importantly, the GJ confirmed that it was indeed open to a court hearing an application in terms of r 46A(9)(c) to revisit the underlying order of special executability against the respondents’ primary residence, should it come to light that the circumstances of the matter had changed to such an extent that such an order was no longer warranted. Such might be the case where there were other satisfactory means of satisfying the judgment debt. The GJ, however, declined to exercise its discretion in this case in favour of setting aside the order of special executability. There was no real prospect that the considerable arrears would be paid off in the absence of a sale of the property in execution.

The GJ held further that –

  • it was not appropriate that the sale in execution of the property should take place without a reserve price;
  • the applicant’s claims that such a course of action was necessary for a sale to take place was unfounded; and
  • the sheriff’s report showed that there had indeed been significant interest in the property at the unsuccessful auction.

The solution the GJ arrived at was to set the reserve price at the amount of the highest bid submitted at that auction, that is, R 300 000, which according to the GJ was the best indication of the property’s value.

Other civil cases

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

  • appeals against decisions of the Community Schemes Ombud Service;
  • capital gains tax on trusts;
  • curatorship for insurance companies;
  • determination of accrual in divorce cases;
  • execution pending appeal;
  • internal appeals in environmental law cases;
  • irregularities in government procurement;
  • pre-emption in land sales;
  • right of way;
  • summary judgment in magistrates’ courts; and
  • the constitutionality of the Executive Ethics Code.

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 2023 (May) DR 32.

X