I Heard It Through the Grapevine

THE SA ATTORNEYS’ JOURNAL

SEPTEMBER 2016 I HEARD IT THROUGH THE GRAPEVINE: THE DIFFERENCE BETWEEN LEGAL PROFESSIONAL PRIVILEGE AND CONFIDENTIALITY When is it appropriate for the sentencing court to interfere with parole?

Dying declaration – should the dead have a say in a matter?

Evictions – a sad reality in South Africa

On the relativity of property rights in the Constitution

NADEL NEC resolutions discussed at press conference

BLA strengthens relations with the NBA

Newly appointed judges acknowledged

Brie ng Pattern Task Team drafting brie ng protocol for the profession IA BUSINESS GLOBALrs IND ambe LAW JOURNAL chAND PARTNERS 2016 Managing

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ENSafricaAd210x297Mar2016_award_strip.indd 1 2016-07-12 12:56:24 PM THE SA ATTORNEYS’ JOURNAL THE SA ATTORNEYS’ JOURNAL CONTENTS

SEPTEMBER 2016 Issue 567 ISSN 0250-0329

Regular columns

Editorial 3 News NADEL NEC resolutions discussed at press conference 4 Black Lawyers Association strengthens relations with the National Bar Association 5 4 Newly appointed judges acknowledged 7 Pathway to progress: One small act can make an impact 8 2016 annual general meetings 8 Cape Town Candidate Attorneys’ Association update 10 LSSA News Briefing Pattern Task Team drafting briefing protocol for the profession 12 LSSA fields election observer team 12

People and practices 14 7 7 Practice management Applying for a Fidelity Fund Certificate 15 Trust account risk and risk to the practice’s business 17 Practice note The validity of a verbal antenuptial contract 18 Retirement funding – obligations on the employer 19 The Special Voluntary Disclosure Programme: Recent developments 20

Book for lawyers 21

10 The law reports 35

Case notes Lockout of members of trade unions not party to a bargaining council 41 Employer liable for damages caused to ex-employee due to non-compliance with debarment process 42

New legislation 44

Employment law update 45

28 30 Recent articles and research 47

DE REBUS – SEPTEMBER 2016 - 1 - EDITOR: FEATURES Mapula Thebe NDip Journ (DUT) BTech (Journ) (TUT) I heard it through the grapevine: The 22 PRODUCTION EDITOR: Kathleen Kriel – difference between legal professional BTech (Journ) (TUT) privilege and confidentiality SUBEDITOR: SUBEDITOR: n the context of legal professional ethics, the terms ‘con- Kevin O’ Reilly – Isabel Joubert – fidentiality’ and ‘privilege’ are often used interchangea- MA (NMMU) BIS Publishing (Hons) (UP) bly. While these two terms may overlap in some respects, I EDITORIAL SECRETARY: they remain two distinct concepts says Kristin Wagner and Shireen Mahomed Claire Brett. The distinction between confidentiality and legal EDITORIAL COMMITTEE: professional privilege is absolutely essential insofar as their Mohamed Randera (Chairperson), Denise Lenyai, differences ensure the proper functioning of the South African Giusi Harper, Peter Horn, Lutendo Sigogo legal system, which is dependent on freedom of communica- EDITORIAL OFFICE: 304 Brooks Street, Menlo Park, tion between legal practitioners and their clients. Pretoria. PO Box 36626, Menlo Park 0102. Docex 82, Pretoria. Tel (012) 366 8800 Fax (012) 362 0969. E-mail: [email protected] When is it appropriate for the 26 DE REBUS ONLINE: www.derebus.org.za sentencing court to interfere with parole? CONTENTS: Acceptance of material for publication is not a guarantee that it will in fact be included in a particular issue since this depends on n practice there are judicial officers who impose a sentence the space available. Views and opinions of this journal are, unless otherwise stated, those of the authors. Editorial opinion or comment is, unless other- that the accused will undergo a certain period of imprison- wise stated, that of the editor and publication thereof does not indicate the ment and will not be eligible for parole. Nicholas Mgedeza agreement of the Law Society, unless so stated. Con tributions may be edited I for clarity, space and/or language. The appearance of an advertisement in and Dumisani Masuku discuss whether the magistrates’ courts this publication does not necessarily indicate approval by the Law Society are vested with the powers to impose a sentence where parole for the product or service ad ver tised.

is denied? De Rebus editorial sta use online products from: • LexisNexis online product: MyLexisNexis. Go to: www.lexisnexis.co.za; and 28 Dying declaration – should the dead have a • Juta. Go to: www.jutalaw.co.za. say in a matter? PRINTER: Ince (Pty) Ltd, PO Box 38200, Booysens 2016. he dying declaration is based on the Latin maxim ‘nemo AUDIO VERSION: The audio version of this journal is available free of charge to all blind and print-handicapped members of moriturus praesumitur mentiri’. Literally translated it Tape Aids for the Blind. means ‘a man will not meet his maker with a lie in his T ADVERTISEMENTS: mouth’. This article written by Sherika Maharaj, discusses the Main magazine: Ince Custom Publishing history of the dying declaration and the legal principles prac- Contact: Dean Cumberlege • Tel (011) 305 7334 Cell: 082 805 1257 • E-mail: [email protected] tised in South Africa. Classi eds supplement: Contact: Isabel Joubert Tel (012) 366 8800 • Fax (012) 362 0969 PO Box 36626, Menlo Park 0102 • E-mail: [email protected] Evictions – a sad reality in South Africa 30 ACCOUNT INQUIRIES: David Madonsela Tel (012) 366 8800 E-mail: [email protected] adeleine Truter writes that South Africa’s history is CIRCULATION: De Rebus, the South African Attorneys’ Journal, is one where the majority of people have been deprived published monthly, 11 times a year, by the Law Society of South of land, and have experienced a lack of access to hous- Africa, 304 Brooks Street, Menlo Park, Pretoria. It circulates free of M charge to all practising attorneys and candidate attorneys and is ing and despite the progress made by the legislature and ju- also available on general subscription. diciary to ensure that no South African is left homeless, land ATTORNEYS’ MAILING LIST INQUIRIES: Gail Mason evictions are still rampant, and officials on the ground are Tel (012) 441 4629 E-mail: [email protected] finding ways to circumvent the overarching test of ‘justice and All inquiries and notications by practising attorneys and candidate attorneys should be addressed to the relevant law society equity’, introduced by the PIE Act. which, in turn, will notify the Law Society of SA. SUBSCRIPTIONS: General, and non-practising attorneys: R 920 p/a On the relativity of property rights in the Retired attorneys and full-time law students: R 710 p/a 32 Cover price: R 95 each Constitution Subscribers from African Postal Union countries (surface mail): R 1 465 (VAT excl) he very first founding provision of the Constitution de- Overseas subscribers (surface mail): R 1 790 (VAT excl) clares that the Republic is a state founded on values. NEW SUBSCRIPTIONS AND ORDERS: David Madonsela TOur social order is in the first place a value based soci- Tel: (012) 366 8800 • E-mail: [email protected] ety, and not rule based. This article, written by Johan van der Merwe, aims to consider briefly, and in very broad strokes, how the concept of property rights in a democratic constitu- © Copyright 2016: tion differs from the pre-constitutional dispensation, what the Law Society of South Africa 021-21-NPO values are that underlie the rules of constitutional property Tel: (012) 366 8800 rights, particularly vis-à-vis use rights, the impact on social

and environmental justice, and how the Constitutional Court Member of The Audit Bureau of is giving effect to these changes. Circulations of Southern Africa

DE REBUS – SEPTEMBER 2016 - 2 - EDITOR’S NOTE Free and fair elections?

n the heels of the the aftermath of the elections local government state that the African National elections held on 3 Congress (ANC) is consider- August, the Law So- ing changing the Electoral Act, ciety of South Afri- which it blames for benefiting Oca (LSSA) issued a press release, opposition parties at its ex- which states that ‘the elections pense. The ANC were to discuss were on the whole free and fair’. the electoral system and the Mapula Thebe – Editor The LSSA fielded a team of over calculation of allocated seats at 300 admitted attorney election its upcoming national executive observers during the local gov- committee meeting. The elec- ernment elections. tion results show that the ANC Would you like to write The press release goes on fur- received the most votes across for De Rebus? ther to state that there were the country; amongst others, it De Rebus welcomes article contri- some irregularities that were had to seek coalitions in three butions in all 11 official languages, especially from legal practitioners. observed during the elections. important metros in Gauteng Practitioners and others who wish The LSSA will investigate the after losing Nelson Mandela to submit feature articles, practice irregularities further; all the Bay, in the Eastern Cape to the notes, case notes, opinion pieces details regarding these will be Democratic Alliance. The sup- and letters can e-mail their contributions to [email protected]. noted fully in the final report, port of the ANC has fallen from The decision on whether to pub- which will be published during 62% of the national vote in 2011 lish a particular submission is that August. to 54% in the 2016 local govern- of the De Rebus Editorial Com- mittee, whose decision is final. In It goes without saying that ment elections. general, contributions should be free and fair elections are part Whether there are legitimate useful or of interest to practising and parcel of any thriving de- grounds to change the Electoral attorneys and must be original and not published elsewhere. For mocracy. Therefore any ob- Act, or whether this is just the more information, see the ‘Guide- served irregularities during case of the ruling party’s denial lines for articles in De Rebus’ on elections would go against the to its apparent lack of confi- our website (www.derebus.org.za). very reason elections are held in dence by the public remains to • Please note that the word limit is 2000 words. a democratic society in the first be seen. Either way, these are • Upcoming deadlines for article place. both signs of a healthy democ- submissions: 19 September and Meanwhile, media reports in racy. 17 October 2016.

De Rebus, The SA @derebusjournal Attorneys’ Journal www.derebus.org.za

DE REBUS – SEPTEMBER 2016 - 3 - NEWS NADEL NEC resolutions discussed at press conference

n 30 July the National Association of Demo- cratic Lawyers (NADEL) held a press conference to discuss the resolutions that were decided on at the National Ex- Oecutive Committee meeting held on the same day. The resolutions taken concerned five issues, namely: • NADEL’s statement on the local government elections. • The political killings associated with the local government elections and the likely impact on the question of fairness of the elections. • The harassment, threats and other ex- Secretary General of NADEL, Patrick Jaji (left), reiterated the senti- ternal influences, which seek to impede ments expressed by the President of NADEL and Co-chairperson of the the independence of press reporting, LSSA, Mvuzo Notyesi, during a press conference held on 30 July. editorial independence, including independence of the broadcasting institutions. This is subsequent to the chaos choice bearing in mind the history of Commenting on independent press that ensued at the South African Broad- revolution in South Africa. We encourage reporting, Mr Notyesi said that the is- casting Corporation (SABC), including members to vote for parties that fight sues that have unfolded at the SABC are the firing of journalists by African News for the aspirations of people that are suf- reminiscent of the Apartheid system Network 7 and any other institution. fering, however, we cannot dictate which and have no place in democratic South • The revival and opening of the Human party members should vote for,’ he said. Africa. ‘Our concern does not end with Rights Research and Advocacy Project Speaking about the recent political the censorship that is happening at the (HRRAP), which is a s 21 company of killings, Mr Notyesi said that the killings SABC, as this shows that there is poor NADEL that will specifically deal with the were a concern to NADEL. ‘Very recent- governance at that institution. We want issue of human rights, legal education ly a number of people have been killed independent reporting of events; we and possible litigations in defense of the in KwaZulu-Natal; a candidate was also want journalists to be able to write arti- Constitution. killed in Port Elizabeth. While we are not cles without any threat. We will join forc- • NADEL’s 30th Anniversary. sure of the motives, the fact that the kill- es with other bodies in defense of jour- In his address, President of NADEL ings are directed at people that belong nalists. The public has a right to know, if and Co-chairperson of the Law Society to certain parties, it tells us that the that right is taken away we are treading of South Africa (LSSA), Mvuzo Notyesi, killings have a political motive. We urge on dangerous ground. We are not satis- said that elections must be free and fair citizens to show their displeasure by fied that the journalists were merely re- while reflecting the views of the people. casting their vote and not through vio- instated at the SABC; we want the matter ‘We undertake to participate fully in the lence. We condemn the killings; we can- to be taken further so that there are clear observer missions of the LSSA, where we not go back to the situation in 1994 of checks and balances. If need be, we will can, in all voting stations. As NADEL is killings before the elections. The killings take the matter further with the Minister an organisation founded on the princi- have a potential to effect the elections of Communications,’ he said. ples of revolution, we would encourage on whether they were free and fair,’ Mr Mr Notyesi said that to show NADEL’s members to vote for parties of their Notyesi noted. commitment to the protection of human

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DE REBUS – SEPTEMBER 2016 - 4 - rights, it will revive the HRRAP. ‘We will yers to do something. There is no need Moseneke playing an active role to lead open an office under a section 21 compa- for grandstanding and sleeping outside, the human rights movement,’ Mr Notyesi ny in Johannesburg. The office will start we do not need to sympathise with the said. operating in August and will be accessi- plight of the indigent, we need to act. Mr Notyesi concluded by saying that ble to members of the public to deal with Sleeping outside does not resolve the is- NADEL will pronounce a candidate, all matters that relate to the protection sues,’ Mr Notyesi added. which they will support for the Public and realisation of human rights. This ‘We are now embarking on document- Protector position, not to influence the will ensure that we uphold the values of ing the work of the organisation over appointment but to ensure that a strong the Constitution. After 22 years of the the past 30 years. We will be holding an candidate is appointed. advent of democracy, we cannot have international event next year where our a situation where there are still people members will be called to be present. Mapula ebe, who do not have proper housing, water … Soon the public will see the likes of [email protected] or sanitation. This calls upon us as law- former Deputy Chief Justice Dikgang

Black Lawyers Association strengthens relations with the National Bar Association

he National Bar Association Over the years BLA delegations, led by Where the Executive Committee ac- (NBA) is the oldest and larg- BLA Presidents, attended the NBA Con- counts to the general membership of est bar of African-American vention in the US. This year a delegation the activities, which they undertook and Attorneys, legal students and of ten BLA members, led by President of those which they plan to fulfil in the fu- judges in the United States of the BLA, Lutendo Sigogo, attended the ture. The review of the year that was by TAmerica (US), with a membership of over NBA Convention, which was held at St the president, as well as the election of 60 000. It was established in 1925 when Louis, Missouri. The high number of the the new leadership; and the presentation some African-American lawyers were de- delegation to the convention came as a of various mandatory Continuing Legal nied membership in the American Bar result of the sterling work and call by the Education (CLE) seminars. Members who Association (ABA). NBA life members and stalwarts, Leroy attend the CLE seminars are credited In the week of 16 to 22 July 2016, the Wilson Jr, Herbert Moreira-Brown and points as a prerequisite of their contin- NBA hosted its 91st Convention under Donald Watson who attended the BLA ued registration as lawyers. the leadership of NBA President, Benja- annual general meeting (AGM) in Octo- The manner in which the NBA CLE min Lloyd Crump. Mr Crump was one ber 2015 (see AGM news ‘BLA AGM: Black Committee arranges and presents semi- of the delegates who attended the NBA lawyers can handle complex matters’ nars is something which should be international affiliates meeting in South 2015 (Dec) DR 6). The three emphasised looked at in SA. In the future all South Africa (SA) in May 2015. He was the then the need to revitalise the relationship be- African legal practitioners will, in terms President-Elect, and this delegation was tween the two organisations and place it of ss 5 and 6 of the Legal Practice Act led by President Pamela Meanes, the on the next level of mutual respect and 28 of 2014 (LPA), be required to attend 72nd NBA President. benefit in terms of sharing of common compulsory Post-Qualification Profes- The relationship between the BLA and experiences and points of divergence. sional Development (PPD) to earn points NBA dates back to the Apartheid era. The NBA members were thrilled by the size for them to continue to practice. In this NBA assisted in establishing the Black of the BLA delegation and undertook to regard, the BLA found the convention Lawyers Association – Legal Education attend the BLA AGM during October in to be highly informative and showcased Trust, which is commonly known as the Kimberley. BLA members were warmly model organisations such as the BLA, Legal Education Centre (BLA-LEC), in the welcomed at the convention and felt at through its Legal Education Centre, can mid-1980s. The purpose of the BLA-LEC home with the hospitable treatment af- remain relatable to the profession and was to empower the SA black lawyers forded to them throughout the conven- empowering to its members and the pro- who did not get much assistance from tion. They constituted the majority of fession at large. The BLA may apply to be the statutory law societies and Associa- the affiliate members out of the US. accredited by the Legal Practice Council tion of Law Societies. The BLA-LEC also The business of the convention is re- to provide PPD in terms of s 6(5)(g) of the established litigation centres throughout garded as a national affair. The official LPA to benefit its members and the pro- the country. These centres in conjunc- opening of the convention was preceded fession in general. Accreditation of BLA tion with the BLA-LEC played a vital role by ‘colours of change’ hosted by the St will strengthen the relationship with the in representing the interests of the dis- Louis Metropolitan Police Department NBA even more, as both BLA and NBA advantaged people, mainly those who and the singing of the National Anthem members may get PPD or CPD points in were arrested or harassed by the secu- as well as ‘Lift Every Voice and Sing’. attending each other’s CLE seminars dur- rity agencies for their stance against the Members of the judiciary received a ing AGMs. As a result there will be more Apartheid regime. The first director of standing procession in their welcome. value for members of the two organisa- the BLA-LEC was the late Godfrey Pitje The convention showcased the profes- tions in attending each other’s events (see news ‘Founding President of the sionalism in the legal profession. and thereby bolster the relationship be- Black Lawyers Association honored’ The convention’s two main functions tween the two. 2015 (Nov) DR 6). are to execute the business of the AGM. The week long convention hosted a to-

DE REBUS – SEPTEMBER 2016 - 5 - NEWS tal of just over 60 seminars. These semi- of the pain they endured as a result of minority. However, the main and pecu- nars were lined up in such a way that the killing of their sons and how they liar challenge facing the African-Ameri- each and every attendee could attend expect the public to support them. They cans is discrimination meted out to them a maximum of four seminars per day emphasised that the deaths of their sons in a form of police brutality wherein a depending on the area of participant’s should never be in vain and that people number of them are being killed by po- practice. The NBA has about 24 perma- should stand-up together and fight the lice under questionable circumstances. nent and ad hoc divisions ranging from continued injustice by voicing their con- The other lesson that may be learnt government lawyers, Judicial Council cerns and also by taking positive actions. from the NBA is how they conduct their (taking into account that NBA member- They said this can be done through regis- elections. Nominated candidates are in- ship also includes judges), law profes- tering to vote and to vote in all elections, terviewed by the nominations committee sors, in-house counsel, small firms/solo, from local to presidential. They spoke to establish if they meet the minimum female lawyers, young lawyers, law stu- about the meaning of being a mother of set requirements. Those who are found dents and labour and employment law a black son in America today. The mod- to be illegible to be voted into the office lawyers, to name a few. Almost all the erators of this symposium were Ed Gor- are recommended to the convention dur- fields of practice were covered in the don, a journalist and television host and ing the opening plenary session. Thereaf- seminars. For example, judges held their Mr Crump. Reverend Jesse Jackson was ter, the floor is opened for nominations own seminars under topics such as – among the attendees, he led the conven- to take place and those nominated will • judging while black: An analytical, sta- tion in prayer and called for a stop in the once again be subjected to the scrutiny tistical and anecdotal examination of the violence and killing of black children. of the nominations committee. If suc- black judicial experience; and The theme, which was a topical dis- cessful, their names are included in the • crisis of confidence in the courts: What cussion to the BLA members, was ‘doing ballot paper. This is very relevant when can judges do? business in emerging markets’. The pan- taking into account the provisions of Topics of seminars are proposed by ellist for this seminar was Kendal Tyre, s 7(2)(e) of the LPA in that a committee the CLE committee and at times are Esq and moderated by Vicky McPherson, like the nominations committee will then adopted through advice by members or Esq. Discussions in this seminar fo- assess if the LPC contestants meet the by presenters. cussed on Africa as an emerging market. requirements espoused in the section. Resolutions and motions are present- Emphasis was placed on the gateways to During the closing session and awards ed by the chairpersons of the resolutions the economic communities in their re- banquet ceremony, President-Elect, and motions committees. There was a gions. During the discussion, BLA mem- Kevin D Judd together with the new ex- first reading of the resolutions and mo- bers emphasised that when US law firms ecutive committee and board members, tions at the opening plenary session and do business with SA firms, in their due were confirmed and sworn in as the new the second reading at the closing ses- diligence, they must look out for pos- President and leadership of the NBA for sion. After the second reading, the mo- sible fronting so that they may partner the 2016 – 2017 term of office, respec- tions and resolutions were debated and with firms, which empower black practi- tively. Juan R Thomas was elected as the adopted. tioners rather than those that use them new President-Elect for the same period. The highlight of the convention was for window dressing for the sake of It was in this session where BLA mem- the recollection and reflection of the compliance with the Broad-Based Black bers were officially recognised and wel- ‘criminal case of the 20th century’, the Economic Empowerment legislation. It comed. OJ Simpson trial, 20 years after the trial. was further emphasised that when in- NBA stalwarts undertook to investi- The session was moderated by Joey Jack- structing South African law firms, such gate the manner through which they can son, the CNN legal analyst and criminal firms must also twin or do work with meaningfully assist in the development defence attorney. The presenter was at- small black law firms so that there may of the black legal practitioners in SA. torney, Carl Douglas, Esq, member of be skills transfer, empowerment and This convention positively assisted in the OJ Simpson legal ‘dream team’. Mr gaining of appropriate experience. The strengthening the relationship between Douglas emphasised that the Ameri- International Law Forum of the NBA wel- BLA and NBA. We believe that this rela- can Constitution was the winner in that comed developments in SA particularly tionship will continue to grow. case because the false evidence planted in respect of prospects for their mem- The 2017 NBA Convention shall be by the police was exposed and was not bers to have opportunities to be admit- held in Toronto, Canada. accepted by the court. Mr Douglas pre- ted and enrolled as legal practitioners in The following BLA members attended sented details and shared his insight to SA in terms of s 24(3) of the LPA. The the convention: Lutendo Sigogo; Mike the strategies used by the ‘dream team’ International Law Forum division under- Chauke; Penelope Magona; Mafori Ed- during the trial. took to develop rules of engagement in ward Lesufi; Mashudu Netshitungulu; The other highlight was the issue of this matter. These rules will include, but Zintle Ngogodo; Stanley Boikanyo; Me- police brutality and killings of black not limited to, requesting big law firms latong Ramushu; Velile Tinto; and Siya males. The convention condemned kill- to enter into joint ventures with small Wotshela. ings of police and by police. This sub- law firms and encourage coaching and ject reached climax on Wednesday when mentorship with observable deliverable the President of the NBA hosted Moth- outcomes. ers of the Movement symposium under This convention also made us realise the theme ‘Transforming tragedy into that black legal practitioners in America triumph in and out of the courtroom.’ are facing, to some extent, similar chal- The symposium was preceded by the lenges as those faced by black legal prac- emotive visit to the scene where Michael titioners in SA, in terms of access to lu- Brown was killed and his memorial site. crative legal work. What, however, makes The mothers of the police victims, Tray- our situation more untenable is that Lutendo Sigogo, von Martin, Jordan Davis, Michael Brown, black people in our country are in the President of the Black Lawyers Association Robbie Tolan and Clinton Allen, spoke majority whereas in the US they are the

DE REBUS – SEPTEMBER 2016 - 6 - Newly appointed judges acknowledged

he KwaZulu-Natal Law Soci- ety (KZNLS) in liaison with the office of the Premier KwaZulu-Natal held a cel- ebratory dinner to acknowledge the appointment of TJustice Mjabuliseni Isaac Madondo as Deputy Judge President of the KwaZulu- Natal High Court and the appointment to the judiciary of Judge Pieter Bezuiden- hout and Judge Thokozile Masipa. The dinner, held on 22 July, was well attended by representatives from the judiciary, KZNLS and the premier’s office. The President of the KZNLS, Lunga Peter, welcomed delegates, while the The Premier KwaZulu-Natal, Chairperson of the Attorneys Fidelity Willies Mchunu, said that his Judge President of the KwaZulu- Fund, Nonduduzo Khanyile-Kheswa, was office saw it fit to congratulate Natal Division, Achmat Jappie’s the programme director. Delivering his Deputy Judge President Madondo speech focused on giving advice address, the Premier of KwaZulu-Natal, on his appointment. to the appointed judges. Willies Mchunu, said that his office saw it fit to congratulate Deputy Judge Presi- dent Madondo on his appointment. Mr new justices that are now on the Bench, was appointed as Deputy Judge Presi- Mchunu added that the importance of I say congratulations. We look forward dent. Some of those who have under- the role of judges in the country was one to the interactions that will happen be- mined Justice Madondo are surely now that needed to be highlighted. tween the two arms of the state. Justice seeing his worth. Democracy has an im- ‘On behalf of government, to all the Madondo has come a long way before he portant role to play to ensure a balance between the past and the present. Jus- tice Madondo will have all the support he needs to fulfil his role as Deputy Judge President,’ Mr Mchunu concluded. Judge President of the KwaZulu-Natal Division, Achmat Jappie’s speech focused on giving advice to the appointed judges. Justice Jappie noted that the job of a judge is to do what others avoid doing, which is making decisions that are difficult at times. He added that recent developments of enabling the media to live record proceedings of court have put Deputy Judge President Madondo the decisions of judges on the spotlight. expressed his gratitude to have ‘Judges should not be surprised; peo- been seen to be fit to be The President of the KZNLS (left), ple will run to the appeals court to ap- appointed as the Deputy Judge Lunga Peter, welcomed delegates, peal decisions. Whatever you do as a President and that the KZNLS while the Chairperson of the judge will make an immense impact on and government organised an Attorneys Fidelity Fund, Nondu- society. … As far as I am concerned there event to acknowledge his duzo Khanyile-Kheswa, was the is no better job than being a judge,’ Jus- appointment. programme director. tice Jappie noted.

DE REBUS – SEPTEMBER 2016 - 7 - NEWS

Speaking on the importance of the re- pointed judges, Justice Madondo ex- and sentencing of those who have com- lationship between the judiciary and the pressed his gratitude to have been seen mitted crimes,’ Justice Madondo added. KZNLS, KZNLS council member Praveen to be fit to be appointed as the Deputy Justice Madondo noted that he has a Sham said that attorneys assist the ju- Judge President and that the KZNLS vision of change for the division he will diciary at times by being acting judges and government organised an event to be presiding over and hopes that others, to ensure a smooth running of the court acknowledge his appointment. Justice in the division, will be able to follow his systems. ‘This is something that is es- Madondo said that the job of a judge vision. sential for the public at large. The Kwa- is to ensure justice is conveyed on the Zulu-Natal Law Society acknowledges citizens, especially the vulnerable. ‘Jus- what the judiciary has done, and contin- tice needs to be seen as effective and ef- ues to do for the public,’ Mr Sham added. ficient. Justice is the resolution of civil Mapula ebe, [email protected] Speaking on behalf of the newly ap- disputes and the prosecution, conviction

s long as poverty, injustice and gross inequality per- Pathway to progress: sists in the world, none of ‘Aus can truly rest’ – Nelson Mandela (www.mandela.gov.za, accessed One small act can 27-7-2016). Children are the future of South Africa and bring joy and hope into the world. make an impact Some are born into loving and advanta- geous homes, whereas others are not. children. Many firms shared the Bloem- ets for the children, giving them warmth This fact alone however, should not fontein School’s vision and made numer- and something to call their own. shape the life of a young and aspiring ous donations. The Bloemfontein School was truly child and spoil their hopes and dreams. With the help of these generous dona- fortunate to have had the opportunity It is with this in mind that the class from tions, the Bloemfontein School was able to have had the support and donations the School for Legal Practice in Bloem- to purchase a large quantity of paint and from – fontein (Bloemfontein School) decided to together with their man-power, began • Symington & de Kok Attorneys; reach out and embark on a journey with to paint the school buildings. The idea • Phatshoane Henney Attorneys; a less fortunate group of young children. behind the newly painted buildings, was • Etienne van Zyl; On 9 July, the Bloemfontein School made not only to bring joy to the children, but • Webbers Attorneys; it their mission to bring renewed aspira- also to bring a sense of pride. For the • Spangenberg Zietsman & Bloem Attor- tions to these children and give them a Bloemfontein School, it is important to neys, sense of belonging in society. The group strive for more than just justice in the • Nick’s Electrical Northern Cape; travelled to Lebone House in Bloemfon- legal world, but also to give back to a • Kloppers Interstate Bus Lines; tein for a community engagement task. community that was in need of a helping • BBS Developers; and The orphanage was established in May hand and some kindness. To give back • the Free State Law Society. 2000 by the AIDS Mission Outreach to the community brings with it a sense Without these generous donations, Trust and opened its doors as a day care of fairness towards those who were dealt the Bloemfontein School would not have facility for HIV/AIDS infected and af- unfair setbacks in life. been able to make their vision a reality. fected children. The painting of the school buildings The Bloemfontein School made con- was not the only task chosen. It was im- tact with a number of law firms, as well portant for the Bloemfontein School to as other businesses in the Bloemfontein also do something more personal for the Janine Heggenstaller is a student at the School for area and shared their ideas on how they children. The Bloemfontein School fur- Legal Practice in Bloemfontein. can contribute to Lebone House and the ther purchased blankets and winter jack-

2016 annual general meetings

The six constituent members of the Law Society of South Africa will have their annual general meetings on the following dates:

Province Date Venue Contact person KwaZulu-Natal Law 14 October Durban – Coastlands Hotel, Umhlanga commencing Riona Gunpath Society at 2 pm. Time and venue may change. (033) 345 1304.

Black Lawyers 21 – 22 October Kimberley – Venue to be confirmed. Lutendo Sigogo Association (015) 962 0712. Free State Law 20 – 21 October Clarens – Protea Hotel. Christina Marais Society (051) 447 3237/8.

Cape Law Society 4 – 5 November Cape Town – Century City Conference Centre com- Thergesari Roberts mencing at 8.30 am. (021) 443 6700.

Law Society of the 19 November Sun City commencing at 9 am. Hester Bezuidenhout Northern Provinces (021) 338 5949.

The National Association of Democratic Lawyers has provisionally set its meeting for the end of February 2017.

DE REBUS – SEPTEMBER 2016 - 8 - AFRICA’S TIME WAITS FOR NO ONE ADAMS & ADAMS – HELPING YOU TO WRITE YOUR CLIENTS’ AFRICAN SUCCESS STORY

Take advantage of the Adams & Adams ONE-THIRD applications lets you benefit from our expertise and ALLOWANCE on all South African trade mark filing world-class systems, while you retain exclusive contact instructions – offered exclusively to our South African with your client. The allowance typically amounts to colleagues. The allowance for all referred trade mark around R1600 per application per class.

ATTORNEYS Patents | Trade Marks | Copyright | Designs | Commercial | Property | Litigation www.adamsadams.com he Cape Town Candidate Attorneys’ Association (CT- Cape Town Candidate CAA) is a dynamic and di- verse body of candidate attorneys (CAs) practising law Attorneys’ Association in the greater Cape Town Tarea. Forming part of this group of CAs, the CTCAA is served by a small commit- update tee of individuals who aim to provide the young professionals in the field with a platform for networking, as well as opportunities to be involved in community initiatives, both directly and indirectly. The CTCAA is fortunate in that it has strong affiliations with the Cape Law So- ciety – as well as the Cape Bar – a dual function of our field on which it prides itself. The CTCAA committee hosts a vari- ety of events throughout the year, with all money raised being donated to de- serving charities. In 2015, the CTCAA committee raised R 65 000, which was allocated towards social donations. Its events include – • pub quiz nights; • education days; • a young professionals evening; • a charity auction; and Grade 9 learners from Maitland High School participating • a closing function. in the CTCAA Take a Child to Work Day. These events enable its sponsors to be part of its networking and social responsibility commitments, while provid- with a group that provides pub quiz ser- importance of knowing ones rights, as ing them with an ideal platform to form vices to various Cape Town based pubs. well as the inner workings of busy law long standing relations with young pro- The CTCAA committee hosted two pub practices. Learners were advised on the fessionals within Cape Town. quizzes in 2016, the first of which was prerequisites of studying law and possi- Ultimately, the CTCAA committee held in May and the second, in August. bly other disciplines that might enhance aims to facilitate networking between The first event of the year took the form their career in law. CAs, prominent members of the legal of a pub quiz held in Cape Town. The Participating law firms showed their fraternity and other young professionals evening was well attended and guests hospitality by treating the learners to in the greater Cape Town area, while re- were asked to answer questions on a var- lunch. The programme was not all fun maining mindful and dedicated towards ied selection of interesting topics. The and games, learners were tasked with its social responsibilities with regard to winners walked away with complimen- conducting preliminary research on those less fortunate. For this reason the tary prizes from the partnered brands relevant matters such as evictions and CTCAA committee’s activities in 2016 and sponsors. consumer protection related issues. consist primarily of involving CAs in so- Through the media, many young people cial events, social responsibility projects Take a child to work day have a skewed perception of the legal and fund raisers, with the aim of raising In May, as part of our Community De- profession; and the CTCAA provided funds for its main charity, The Home- velopment Programme, the CTCAA in- clarity by ensuring that the learners were stead Projects for Street Children (The troduced a programme called ‘Take a taken on tours of the various courts and Homestead). Child to a Law Firm Day.’ The CTCAA judicial offices around the city. focused on working in conjunction with The CTCAA is fortunate to be working The CTCAA pub quiz Maitland High School that has children in an ever changing profession, and it is from disadvantaged areas. Several Grade through these initiatives that it is able nights 9 learners were welcomed into the of- to share the lessons it has learnt along The CTCAA committee has in the past fices of various firms across Cape Town. the way. The CTCAA looks forward to supported a vibrant local partnership The programme aimed to highlight the hosting more learners in the future and hopes to encourage more firms to open their doors to eager high school learners. The young professionals evening The CTCAA, in partnership with the South African Institute for Chartered Accountants, as well as the Trainee Ac- countant Society, invites young professionals annually in various fields for a Young Professionals Evening. Candidate attorneys attending the Young Professionals The first Young Professionals Evening evening held by the CTCAA. (YPE) was held on 15 June at the BMW

DE REBUS – SEPTEMBER 2016 - 10 - NEWS

curing employment within their desired try will be R 500 per team. Expectedly, field of employment. all proceeds raised will be going towards its partnered charity and upcoming so- Mandela day cial responsibility projects. The CTCAA In line with the vision of Mandela day looks forward to receiving entries and actions being focused on the realisation being the first group of candidate attor- and restoration of dignity and empower- neys to participate in this initiative. ment through contributions in areas of Candidate Attorneys and firms can civic need, the CTCAA supported by its e-mail Darren Hanekom at darren.hane- main partners, BMW and PPS, arranged [email protected] to enter. for a fun day out at The Homestead, the CTCAA’s charity for 2016. Charity auction The work done by the CTCAA throughout The 2016 Candidate the year is only made possible through Attorney Moot Court the kind donations received from sponsors. The Charity Auction is the CTCAA’s Paul Hooper, Director of The Competition biggest event and has in the past been Homestead Projects for Street The CTCAA committee will be launching very successful in raising funds and at- Children, addressing YPE guests. the very first inter-firm Candidate Attor- tracting attendees from various profes- ney Moot Competition in November. As sional spheres. The CTCAA envisages an new entrants to the legal profession, the even more successful auction this year, Auto Atlantic venue in Cape Town. The CTCAA believes that every CA should be which can only be achieved with the help YPE is one of the CTCAA committee’s equipped with skills to confidently navi- from their invaluable sponsors. Guests events, which are specifically aimed at gate their way around the district level are treated to three course meals and providing young professionals with a motion and criminal courts. Taking place funds are raised through the auction- pleasant and unique networking experi- at the Wynberg Magistrate’s Court, par- ing of unique sponsored items such as ence. ticipants will have a choice of competing F1 racing experiences and one of a kind This year’s YPE centred on the theme in either a Criminal Court bail applica- collectables. of selflessness, with Paul Hooper of The tion or arguing an opposed prevention of The charity auction will take place on Homestead speaking to attendees about illegal eviction (PIE) application. Matters 4 November 2016. their work in taking homeless children will be presided over by magistrates and off the streets of Cape Town and social- senior practitioners. Top litigators will Conclusion ising them back into schools. be selected on a points based system. In conclusion, the CTCAA is conscious The life of CAs can become isolated; The winning firm and their selected of the challenges which exist within the hence the CTCAA committee continually CAs will have their names engraved into profession. Scarce CA placement oppor- strives to provide the body with social the CTCAA trophy. This will be an annual tunities create competitive law students, initiatives to counter this. event, which aims to foster the tradition who in turn look to compete rather than of cooperative learning and camaraderie. cooperate with their peers. This culture Education day Winning firms will be encouraged to de- of competiveness only hinders oppor- Due to the ever increasing unemploy- fend their titles in subsequent years. tunities to learn from each other and ment levels among the youth within The CTCAA understand that many further exacerbates fragmentation and South Africa, the CTCAA tries to allevi- CAs are not afforded with the opportuni- isolation within the profession. Rather ate the burden put on high schools and ty to gain experience within litigation. To than digging our heads in the sand, one learners in preparing learners for the aid participants in building their skills should look to take small strides in cre- workplace. During the CTCAA education within this space, the CTCAA committee ating an inclusive fraternity. Due to the days, hosted at Maitland High School, will be hosting two workshops, the first dreary salaries offered to aspirant at- the CTCAA invited professionals from workshop will be led by one of the coun- torneys, the growing consensus among industries ranging from drama and film try’s top criminal defence attorneys and many CAs is that practice is not for eve- to medicine and construction and gave the second will be led by Senior Council ryone, and that the tenure of articles is learners the opportunity to ask ques- behind landmark Constitutional Court just another way to make ourselves more tions relating to their area of interest. judgments relating to housing and mass marketable to the corporate world. The Not only are learners given an introduc- evictions. CTCAA believes that practice is indeed tion to various job opportunities, learn- Each firm, regardless of size will be for everyone, we did not study all these ers are also taken through a CV writing allowed to enter two teams of two CAs, years to become yet another cog in the course to increase their chances of se- one per category (criminal and civil), en- machine. The CTCAA challenges CAs to join it in their journey in growing, learning and sharing what it means to practice law in this country we call home.

• Find the CTCAA Facebook at www. facebook.com/capetowncaa/ or e-mail: [email protected]

Darren Hanekom, Cape Town Candidate Attorneys’ Association Chairman q

DE REBUS – SEPTEMBER 2016 - 11 - LSSA NEWS

Compiled by Barbara Whittle, communication manager, Law Society of South Africa, [email protected]

Briefing Pattern Task Team drafting briefing protocol for the profession

Briefing Pattern Task Team, The advocates and Mr Scott have been • Briefing patterns at local government chaired by Johannesburg at- delegated to prepare a draft briefing pro- level should also be investigated by both torney and former Law So- tocol. the task team and the DoJ&CD. ciety of South Africa (LSSA) The task team resolved the following: • The task team would approach the Co-chairperson, Busani Ma- • The role of the DoJ&CD is pivotal judiciary for its perspective, as well as to bunda,A is drafting a briefing protocol for to the process as it needs to coordinate discuss concerns that have been raised attorneys and advocates. The task team, briefing instructions through the Office at various levels of the judiciary regard- which was constituted as an outcome of of the State Attorney. There should be ing briefing issues. Mr Mabunda, Mr the LSSA Summit on Briefing Patterns close cooperation with the new Director- Masher and Ms Platt would arrange to held at the end of March this year (see General of Justice, Vusi Madonsela, as meet Judge President Dunstan Mlambo 2016 (May) DR 6), meets on a monthly the task team would need to also con- of the High Court Gauteng Division, who basis to discuss and implement the reso- sider the policies being drafted by the had attended the summit and who had lutions taken at the summit. department as they related to briefing. offered his cooperation in this regard. Besides Mr Mabunda, the task team • The LSSA would continue to seek in- • The various mentorship initiatives includes attorneys Mvuso Notyesi and formation on briefing and the distribu- Richard Scott (respectively the current tion of legal work generally from state- on the attorneys’ and advocates’ profes- and a former LSSA Co-chairperson), as owned enterprises and government sion would be taken into consideration well as Dion Masher – who represents departments to build on the report that as they impacted on skills development the large firms – advocates Ish Semenya was produced for the summit. and briefing. SC, Anthea Platt SC and Thandi Norman • The task team expressed its grave • Various funding opportunities would SC represent the advocates’ profession concern at the apparent lack of coop- be explored as the task team members and Varsha Sewlal from the Department eration from business organisations and were of the view that the initiative of Justice and Constitutional Develop- undertook to seek the active participa- should be a properly resourced and ment (DoJ&CD). Dr Tsili Phooko is the tion of various business and industry funded transformation initiative by the LSSA facilitator for the project. bodies with the work of the task team. profession. LSSA fields election observer team

he Law Society of South The week before the elections, on Africa (LSSA) fielded a 27 July, LSSA Co-chairpersons Jan team of over 300 attorney van Rensburg and Mvuso Notyesi election observers at the attended the launch of the National local government elec- Results Operations Centre for 2016 Ttions on 3 August 2016. The LSSA Municipal Elections at the Tshwane was to provide a preliminary report Events Centre in Pretoria. Later that to the Electoral Commission (IEC) evening they addressed a network- within 48 hours of the close of the ing session of the National Press polls and then a full report by 12 Club on the LSSA election observer August. mission. q

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#ThingsThatReallyMatter

15697 15697 NB PRB Generic A4.indd 1 PEOPLE & PRACTICES People and practices Gildenhuys Malatji in Pretoria has ap- Compiled by Shireen Mahomed pointed Sayi Nindi- Tshiani as a senior associate in the commercial litigation and public law department.

Roodt Inc in Johannesburg has two Webber Wentzel has two new appointments. promotions.

Natashua Coetzer Kathryn Gawith Alexia Christie has has been promoted has been appointed been welcomed as a senior associate. as a partner in Jo- back as a partner She specialises in hannesburg in the in Cape Town in mergers and acquisi- dispute resolution the growth and tions, commercial department. development de- contracts, competi- partment. tion law, company law and corporate governance. Hogan Lovells in Johannesburg has two new appointments.

Johan Dawid Beyers Carl Stein has Julia Sham has has been promoted been appointed been appointed as a senior associ- as a partner in as an associate in ate. He specialises in the corporate and the competition mergers and acquisi- commercial depart- department. She tions, commercial ment. He specialises specialises in com- contracts, competi- in stock exchange petition law. tion law, commer- transaction, corpo- cial litigation, copy rate and structured infringement, corpo- finance and drafting rate governance, and complex commercial gambling law. agreements.

Mothle Jooma Sabdia Inc in Pretoria has seven new promotions.

Teboho Makwati has been promoted as an associate.

Advertise for free in the People and practices column. E-mail: [email protected]

Please note, in future issues, five or more people featured Front from left: Nicolene Komar has been promoted as a senior associate, Thipe from one firm, in the same Mothle is a director, Ebrahim Jooma is a director, and Adéle van der Merwe has area, will have to submit a been promoted as a senior associate. Back row, from left: Sian Butterworth has group photo. Please also note been promoted as an associate, Mohammad Mamod has been promoted as an as- that De Rebus does not in- sociate, Michelle Gioia has been promoted as an associate, and Telana van Niekerk clude candidate attorneys in has been promoted as an associate. this column. q

DE REBUS – SEPTEMBER 2016 - 14 - PRACTICE MANAGEMENT – LEGAL PRACTICE

By the financial forensic unit of Applying for a the Attorneys Fidelity Fund Fidelity Fund Certificate

ection 41 of the Attorneys Act 53 of 1979 requires a • 1 April – 30 June; and practitioner to be in possession of a Fidelity Fund Cer- • 1 July – 30 September. tificate (FFC) in order to practice on his or her own ac- In order for the practitioner to report these balances per count or in partnership. The section further states that trust account, the practitioner needs to go to ‘manage bank ac- should a practitioner practice or act in contravention counts’, assign the accounts to s 78(1) where it says ‘assign to Sof the requirement, the practitioner shall not be entitled to any section’. Should any of the trust accounts opened in the name fee, reward or disbursement in respect of anything done by of the firm not appear on the list of trust accounts, the practi- him or her while so practising or acting. FFCs are issued by the tioner can add the missing trust account and also assign it to Attorneys Fidelity Fund (AFF) through its appointed agencies, the section. namely, the four statutory law societies. The validity period for Once the trust account is assigned to the section that ac- each issued FFC is a year, from January to December of that count number will reflect under the tab for s 78(1), and the year, for example, from 1 January 2016 to 31 December 2016. practitioner is able to capture the balances. Practitioners Practitioners are able to apply for their FFCs for the following should be ready with the following information in order to year from 1 October of the year preceding the year for which complete the balances: the FFC is required. • The bank balances as at 31 December, 31 March, 30 June and In order to qualify for an FFC, the following requirements 30 September as reflected in the trust bank statement. must be satisfied: • The service fee formula as provided by the bank. • The firm’s opening (in the case of new firms) or year-end • The interest rate that was applicable on the credit balances as trust audit report must be approved by the law society to at the reported periods. which the firm belongs. It should be noted, however, that some new firms may not yet have reached their due date for submis- Section 78(2)(a) sion of their opening trust audit reports at the time of applying This section requires the balance/s of all the s 78(2)(a) trust for the FFC, such firms are exempted from this requirement. investment accounts of the firm, individually reported, as at Other firms may be exempted by their law societies for various the end of the following preceding periods – reasons from submitting trust audit reports. • 1 October – 31 December; • The practitioner applying for the FFC must have satisfied the • 1 January – 31 March; practice management training (PMT) requirements. This train- • 1 April – 30 June; and ing became compulsory for all practitioners who started prac- • 1 July – 30 September. tising on their own account or in partnership after 14 August The s 78(2)(a) investments refer to all investments done by 2009. However, the law society may exempt some practitioners the firm, in the name of the firm, taken from excess funds in who start practising after that date. the trust account and do not belong to a specific trust creditor. Until 2015, a practitioner would complete an FFC application The interest earned on these investments is due to the AFF. form, submit it to the law society, and the law society would In order for the practitioner to report these balances per issue the FFC should the applicant be compliant with all re- s 78(2)(a) trust investment account, the practitioner needs to quirements. With effect from the 2016 year, the AFF provided go to ‘manage bank accounts’, assign the accounts to s 78(2)(a) an automated system to the law societies to administer the is- where it says ‘assign to section’. Should any of the trust invest- suance of these FFCs. This system went live at the beginning of ment accounts opened in the name of the firm not appear on November 2015, and all applications for the 2016 period were the list of trust accounts, the practitioner can add the missing processed through the online application. Data utilised by the trust investment account and also assign it to the section. system to facilitate the issuance of the FFCs is integrated from Once the trust investment account is assigned to the section, the law societies’ member system, and this is data already re- that account number will reflect under the tab for s 78(2)(a), siding with and known to the law societies. The aim of the AFF and the practitioner is able to capture the balances. Practition- in providing this online system is to utilise the financial and ers should be ready with the following information in order to other information provided on the system for its risk manage- complete the balances: ment initiatives. • The bank balances as at 31 December, 31 March, 30 June We noticed, while attempting to utilise the information for and 30 September as reflected in the trust investment bank our risk management initiatives that the information is not statement. necessarily correctly captured. In anticipation of the next • The service fee formula as provided by the bank. round of a peak season for issuance of the FFCs, we therefore • The interest rate that was applicable on the credit balances as felt it necessary to assist new and existing practitioners with at the reported periods. how to complete the required financial information correctly. The section below deals with how to correctly capture the fi- Section 78(2A) nancial information required in terms of s 16 of the FFC ap- This section requires the combined balances of all the s 78(2A) plication form, gazetted on 30 September 2015, on the online trust investment accounts opened by the firm on behalf of spe- system (GN R898 GG39239/30-9-2015). cifically identifiable trust creditors, as at the end of the following preceding periods – Section 78(1) • 1 October – 31 December; This section requires the balance/s of all the trust account/s of • 1 January – 31 March; the firm, individually reported, as at the end of the following • 1 April – 30 June; and preceding periods – • 1 July – 30 September. • 1 October – 31 December; The s 78(2A) trust investment accounts refer to all invest- • 1 January – 31 March; ment accounts opened by the firm in the name of an identifi-

DE REBUS – SEPTEMBER 2016 - 15 - able trust creditor, with an underlying transaction, and making • 1 April – 30 June; and reference to the section. The interest earned on these invest- • 1 July – 30 September. ments is due to the trust creditor and the practitioner may levy The pure investment accounts refer to all investment ac- reasonable administration fees for administering the invest- counts opened by the firm in the name of an identifiable client. ment. The client may or may not be a trust creditor. Where the client Practitioners should be ready with the following information is a trust creditor, it could be that the invested funds have no in order to complete the required balances: relation to the matter that the practitioner is providing legal • The combined trust investment balances as at 31 December, services on. The interest earned on these investments is due to 31 March, 30 June and 30 September as reflected in the trust the client and the practitioner may levy reasonable administra- investment bank statements. tion fees for administering the investment. • The breakdown of the reported balances as follows – Practitioners should be ready with the following information – commercial matters; in order to complete the required balances: – conveyancing matters; • The combined investment balances as at 31 December, 31 – Road Accident Fund matters; March, 30 June and 30 September as reflected in the invest- – litigation matters; ment bank statements. – estate matters (only those that went through the s 78(1) trust Please ensure that the investment balances already captured accounts); under s 78(2A) and reflected in the breakdown are not recap- – investments (pure investments with no underlying transac- tured under this section as that distorts the reported financial tions, opened by the firm on behalf of specifically identified information. client, but incorrectly invested under s 78(2A)); and – any other matters. Estates Practitioners should ensure that they correctly assign the This section requires the combined balances of all the estate amounts to the breakdown section and that the allocation matters administered by the practitioner or where the practi- tallies to a 100% of the reported balance per reported period. tioner is the appointed executor, and separate estate accounts Without the amounts tallying, the system will not allow the have been opened with funds on these matters not flowing practitioner to proceed with the application. through the main trust account/s, as at the end of the following preceding periods: Investments • 1 October – 31 December; This section requires the combined balances of all the pure in- • 1 January – 31 March; vestment accounts opened by the firm on behalf of specifically • 1 April – 30 June; and identifiable clients, as at the end of the following preceding • 1 July – 30 September. periods – Practitioners should be ready with the following information • 1 October – 31 December; in order to complete the required balances: • 1 January – 31 March; • The combined estate accounts balances as at 31 December, 31 March, 30 June and 30 September as reflected in the estate accounts bank statements. Please ensure that the estate balances already captured under s 78(2A) and reflected in the breakdown are not recaptured under this section as that distorts the reported financial information. Property This section requires the combined balances of all other property, other that liquid cash, entrusted with the practitioner. This refers to property like houses, cars, investment coins, et- cetera, which require that they are fairly assessed to determine their value as at the end of the following preceding periods – • 1 October – 31 December; • 1 January – 31 March; • 1 April – 30 June; and • 1 July – 30 September. Practitioners should be ready with the following information SERVICED OFFICES in order to complete the required balances: • The combined property balances as at 31 December, 31 March, 30 June and 30 September as fairly assessed. A complete business solution for Please ensure that the balances reported under this section for property such as houses are not the balances reported un- the legal professional der conveyancing matters reported under s 78(2A). 9 Ideally located in the heart of Alberton 9 In close proximity to all major courts and city centres Conclusion 9 Fully serviced and modern of ces In conclusion, practitioners are urged to apply for their 2017 9 Affordable xed monthly rental FFCs on time to avoid the rush and frustration should they 9 Includes available business services and facilities find themselves not eligible to receive their certificates for 9 Safe and secure whatever reason. This will allow them time to attend to whatever requires attention. Practitioners are further urged to re- frain from practising without a valid FFC as they are in breach 1 EATON TERRACE, ALBERTON of the requirements of legislation when they do so. [email protected] www.chamberonterrace.co.za 011 - 907-9813 The financial forensic unit of the Attorneys Fidelity Fund in Centurion. q

DE REBUS – SEPTEMBER 2016 - 16 - PRACTICE MANAGEMENT – LEGAL PRACTICE

By Jannie Trust account risk Dannhauser and risk to the practice’s business

henever I do an audit on The outlook is mostly that the trust incorrect and incorrect recoveries or an attorney’s trust ac- account does not affect the business. fees being levied from clients. A robust count, I am reminded of Therefore, if the trust account balances system of controlling the processing of the uniqueness of the and is not in a shortfall situation, there transactions by suitable levels of staff accounting and systems is nothing to worry about regarding the will address this problem. Wrelated to attorney trust accounts. As business. It should be remembered that opposed to the accounts of other busi- trust accounts will still balance, even if • Over-reliance on computer nesses, it reflects receipts and payments the transactions recorded are incom- systems only, but instead of income and expens- plete. Losses do not only occur, owing to es, assets and liabilities are created. Cli- theft or fraud, but also owing to incor- A trust account trial balance that balanc- ent accounts are in credit, whereas in rect recording of transactions, which do es is not an indication that transactions business accounts they are in debit. This not highlight resultant shortfalls. have been correctly recorded. Systems is enough to throw the most experienced The quality of staff and the systems that force entries through to balance commercial bookkeeper off track. within which they perform their duties the trust account do not always high- But therein lies the rub. Most attor- are of paramount importance to the light the root cause of a problem, which neys I speak to, place almost complete practice. may have to be corrected with different reliance on their bookkeeping staff and entries. The maturity and experience of computer systems to ensure that the There are five common staff overseeing the process can alleviate transactions related to the trust ac- reasons for increased risks attached to this problem. counts are correctly recorded. In gen- • Lack of supervision eral, bookkeeping staff only obtain their business risk to an knowledge of trust account bookkeeping attorney practice: The size of the accounting staff compo- from experience and not from formal nent relative to the volume of transac- training. They mostly receive their com- • Inadequate training of tions being processed mostly does not puter system training from the supplier bookkeepers/accounting staff leave enough time for proper checking of the system, so errors in the system are and supervision of activities, whether by hardly ever noticed or questioned. You want to be comfortable that the per- superiors or partners. The system should Computer systems for legal practices son you employ to be custodian of your allow for checking and reporting func- vary in their robustness and some even clients’ money knows exactly how the tions, the frequency being relative to the automate transactions to balance imbal- transactions affect the bookkeeping en- amounts and risk involved, in order for ances, without taking the validity of un- tries and the legal requirement to keep errors to be identified in time. Relying derlying transactions into account. the client account funded. on the annual audit to ascertain whether In a business, the clients would act as the trust account books are satisfactory whistle-blowers to identify errors that • Administrations systems is one of the extreme, unsatisfactory sce- the system does not prevent. Most of Different services are recorded on a ‘one narios that I have encountered. the clients of a legal practice are not ‘fi- size fits all’ basis. As Paul Ehrlich once said: ‘To err is nancially literate’ enough to determine A detailed assessment of each type of human, but to really foul things up you whether their account is correct. That is, service in the practice needs to be con- need a computer’. if they ever receive a final statement of ducted when designing your administra- I submit that the greatest service a le- account. tion system. Different services bring dif- gal practitioner can do to his practice is This places the practice at substantial ferent challenges and they can culminate to invest time and effort in the training risk, not only of non-compliance with the in substantial business risks, if not at- of the accounting staff and develop the rules and the Attorneys Act 53 of 1979, tended to. Litigation would bring a cash administration and computer systems but also of other business risks. The po- flow challenge, as counsel and other ex- for them to provide the controls and re- tential for claims from clients emanating penses may be substantial and advances ports that you require to have peace of from loss of funds is the most obvious from clients sometimes slow in being mind. risk and we do not need to elaborate on received. Property transfer transactions that, but the risk to the business of the are less risky, as they are backed by a legal practice is one that is most often property sale agreement as security. overlooked. Business risks would include risks of • Incomplete transactions Jannie Dannhauser BCompt (Hons) the business incurring losses through (Unisa) CA (SA) RA is an audit risk advancing undue credit, and the busi- Misallocation of transactions or their in- specialist at the Lumenrock Group in ness experiencing negative cash flows correct recording in the business books Johannesburg. and loss of clients, to name a few. will cause client trust accounts to be q

DE REBUS – SEPTEMBER 2016 - 17 - PRACTICE NOTE – CONTRACT LAW

By Magdaleen The validity of a verbal de Klerk antenuptial contract

ery few people, even legally Legislation person who is not a party thereto. Hav- qualified ones, are aware of ing regard, however, to the common law Section 86 of the Act reads as follows: the fact that a verbal (non- and legislative background to the Act …, ‘86 Antenuptial contracts to be regis- registered) antenuptial con- an antenuptial contract which has not tered tract can be binding inter been so registered is valid and effective An antenuptial contract … executed Vpartes because the term antenuptial as between the parties thereto.’ after the commencement of this Act, contract is normally understood in the In Mathabathe v Mathabathe 1987 (3) shall be registered in the manner and narrow sense of a contract incorporated SA 45 (W) it was held: ‘The existence of within the time mentioned in section in a formal document, executed before a such informal antenuptial agreements eighty-seven, and unless so registered notary public and registered in the deeds is expressly recognised by the Legisla- shall be of no force or effect as against office. ture in s 88 of the Deeds Registries Act any person who is not a party thereto.’ However, the term antenuptial con- 1937. Its subject-matter is: “Postnuptial Sections 87(1) and 88 of the Act are tract can either mean an informal con- execution of antenuptial agreement”. If also relevant, and reads as follows: tract, not complying with the formalities an antenuptial agreement … was arrived ‘87 Manner and time of registration of required by s 87 of the Deeds Registries at between intending spouses, no matter antenuptial contracts Act 47 of 1937 (the Act) or it can mean how informally, the Court is empowered (1) An antenuptial contract executed a formal contract duly registered under by the Legislature to authorise the post- in the Republic shall be attested by a no- the provisions of the Act (see Lagesse v nuptial execution thereof before a notary and shall be registered in a deeds Lagesse 1992 (1) SA 173 (D)). tary, and its registration.’ registry within three months after the In Honey v Honey 1992 (3) SA 609 (W) date of its execution or within such ex- it was held that the term ‘antenuptial tended period as the court may on ap- A verbal antenuptial contract’ is not synonymous with the plication allow. term ‘duly registered antenuptial con- contract 88 Postnuptial execution of antenup- tract’. It was further held that an ante- tial agreement In Ex Parte Kloosman et Uxor 1947 (1) nuptial contract is valid between the Notwithstanding the provisions of SA 342 (T) the court allowed an applica- parties and inter partes regulates their sections eighty-six and eighty-seven the tion for leave to notarially execute and matrimonial property system even if it court may, subject to such conditions as to register after marriage an verbal ante- is not registered. A duly registered ante- it may deem desirable, authorize postnuptial contract, on being satisfied that nuptial contract on the other hand regu- nuptial execution of a notarial contract the alleged verbal agreement had been lates the parties’ matrimonial property having the effect of an antenuptial con- proven. system also as regards third parties. tract, if the terms thereof were agreed In the Spinazze matter it was held: The position under upon between the intended spouses ‘[I]t seems likely ... though it is not nec- before the marriage, and may order the essary to decide this point and though common law registration, within a specified period, of ss 86 and 87 deal with written antenup- In Ex Parte Spinazze and Another NNO any contract so executed.’ tial contracts … that even a verbal an- 1985 (3) SA 650 (A), Corbett JA (as he tenuptial contract, if properly proved, then was) sketched the position under The interpretation of ss would have such validity inter partes.’ common law as follows: According to 86, 87(1) and 88 of the Act In the case of Odendaal v Odendaal the law of Holland, no particular formali- 2002 (1) SA 763 (W), the husband in a ties were required for the execution of by our courts divorce action had relied on an alleged antenuptial contracts. Not even writing In Ex Parte Minister of Native Affairs In Re verbal antenuptial agreement entered was necessary. In general, writing was re- Molefe v Molefe 1946 AD 315 it was held: into between him and his wife in terms garded as serving the object of providing ‘At common law a husband and wife can, whereof they had agreed to be married easier proof of the existence of the con- as between themselves, by an antenup- out of community of property, with the tract and its terms, but was not essential tial agreement, regulate their proprietary exclusion of the accrual system. to the validity of the contract itself. The rights after marriage. Such an agreement The court a quo accepted his evidence validity of a verbal antenuptial contract is binding between the spouses, but is of that he had informed his intended wife was established as early as 1599 by two no effect so far as persons not parties ‘that what was his was his and what was decisions of the Hooge Raad. These deci- thereto are concerned, unless it is duly hers was hers’ and held that the parties sions were to the effect that a verbal an- entered into and registered in accord- had agreed to be married out of commu- tenuptial contract, satisfactorily proved, ance with the law governing ante-nuptial nity of property with the exclusion of the was not only valid inter partes, but also contracts (See secs. 86 and 87 of Act 47 accrual system. effective against creditors of either party of 1937.)’ On appeal against the judgment of the to the contract. Later Roman-Dutch au- In the Spinazze matter it was held: ‘It court a quo it was held that the parties in thorities suggest, however, that to be is clear that in terms of s 86 of the Act an fact agreed to be married out of commu- effective against creditors and third par- antenuptial contract not registered in the nity of property, but given the husband’s ties the contract had to be entered into manner and within the time mentioned ignorance of the accrual system at the in writing and in a public manner. in s 87 is of no force or effect against any time of contracting that the husband did

DE REBUS – SEPTEMBER 2016 - 18 - PRACTICE NOTE – PENSION FUND LAW not discharge the onus of establishing third parties it has to comply with the of the antenuptial contract and thereby that the parties also agreed to exclude formalities required by s 87 of the Act. (in a certain way) to bind persons who the accrual system. Consequently any antenuptial con- are not parties thereto. tract, which is proved to have been en- Conclusion tered into between the intended spous- Magdaleen de Klerk BA (Hons) BProc No particular formalities are required for es, no matter how informally, will be (UFS) Dip Human Rights (UP) is an an antenuptial contract to be valid and valid inter partes. attorney at DDKK Attorneys Inc in enforceable between the parties thereto. The effect of registration is merely to Polokwane. However, to also be effective against give notice to the world of the existence q

By Andrew Retirement funding – Stansfield obligations on the employer

he Pension Funds Act 24 to the fund no later than 15 days after members regularly involved in the man- of 1956 (the Act) imposes the end of the month in respect of which agement of the closed corporation (in a clear obligation on em- the payment was made. respect of a closed corporation), or all ployers to pay over retire- the persons comprising the governing ment contributions time- Personal liability for con- body of the employer, as the case may ously, which in the absence tributions to a pension or be, shall be personally liable in terms of Tof strict compliance becomes a criminal this provision. offence. The purpose of this article is provident fund to sensitise all persons responsible for With effect from 28 February 2014, the Penalties for non- practice management to the seriousness Act states that the following persons compliance of the risks, which may arise in instances shall be personally liable for compliance As set out above, certain persons at the where there is non-compliance with the with s 13A and for the payment of any employer shall be held personally liable provisions of the Act. contributions – for non-compliance with s 13A of the What are the requirements ‘(a) if an employer is a company, every Act. The amendment to the Act has made director who is regularly involved in the this contravention a criminal offence. when paying contributions management of the company’s overall fi- Any person who contravenes or fails to a pension or provident nancial affairs; to comply with s 13A of the Act may be (b) if an employer is a close corpora- found guilty of an offence and liable on fund? tion registered under the Close Corpo- conviction to a fine not exceeding R 10 Section 13A of the Act deals with the rations Act [69 of 1984], every member million or to imprisonment for a period payment of contributions to pension and who controls or is regularly involved in not exceeding ten years. provident funds. The employer must pay the management of the close corpora- all contributions, whether member con- tion’s overall financial affairs; and Trustee duties tributions or employer contributions, (c) in respect of any other employer The trustees of a pension or provident that are due and owing to the fund by of any legal status or description that fund must report any non-compliance to the 7th of the month, following the has not already been referred to in the Financial Services Board. month in respect of which the contribu- paragraphs (a) and (b), every person in Practitioners are advised to take note tions are due. What this means is that all accordance with whose directions or in- and to circulate this article as appropri- contributions due for the month of, for structions the governing body or struc- ate. example, February must be paid to the ture of the employer acts or who con- fund by 7 March. In addition the employ- trols or who is regularly involved in the Andrew Stansfield BCompt (Hons) er must submit a monthly reconciliation management of the employer’s overall (Unisa) Post Grad Dip Tax (UCT) is schedule of all contributions so that the financial affairs.’ the Finance Executive of the Attor- fund may correctly allocate the contribu- If an employer fails to comply with neys Fidelity Fund and Chairperson tions to the members’ records. The rec- the requirements of s 13A, all the direc- of the Legal Provident Fund. onciliation schedule must be submitted tors (in respect of a company), all the q

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DE REBUS – SEPTEMBER 2016 - 19 - PRACTICE NOTE – TAX LAW

By Robert Gad The Special Voluntary and Alexa Muller Disclosure Programme: Recent developments

uring February National cates that the FSD would be entitled to Permanent tax • Relief from crimi- Treasury announced a grant administrative relief in terms of VDP and tax nal prosecution. Special Voluntary Dis- reg 24 of the Exchange Control Regula- SVDP relief • Full/partial relief closure Programme (the tions of 1961 to successful applicants in respect of under- SVDP), which is to apply who submit excon SVDP applications in statement penalties. for a limited window pe- respect of unauthorised foreign assets • Full relief in re- riod from 1 October 2016 to 31 March in accordance with the specifications D spect of administra- 2017 in order to provide an opportunity and requirements set out in the circular. tive non-compliance for qualifying non-compliant persons to Excon SVDP applications will not be en- penalties (excluding regularise their tax and exchange control tertained prior to the official commence- penalties for the affairs as relates to offshore assets and ment date of the SVDP (indicated as 1 late submission of income. October 2016) and any party involved in returns). All SVDP applications are to be submit- a matter currently under investigation ted after the commencement date of the Additional • Exemption from in- by the FSD will not qualify for relief in SVDP (online via the South African Rev- SVDP relief come tax, donations terms of the SVDP. enue Service (Sars) e-filing website or at tax and estate duty The circular provides that a South any Sars branch) to the SVDP unit, which in respect of historic African resident who is the donor in will be jointly operated by Sars and the undeclared income, relation to a non-resident discretionary Financial Surveillance Department of the which gave rise to trust, may in certain circumstances elect South African Reserve Bank (the FSD). the undeclared as- that any foreign asset which was held sets. by the discretionary trust on 29 Febru- The tax SVDP ary 2016 be deemed to be held by that In accordance with the most recent ver- resident for purposes of the SVDP. The relief, there will be included in his or sion of the draft tax legislation dated 19 relevant date on which the trust held the her taxable income for the first year of July (the draft legislation) an application asset for purposes of exercising the elec- assessment ending on or after 1 March in terms of the tax SVDP must be made tion in terms of the excon SVDP (29 Feb- 2014, an amount equal to 50% of the under and subject to the requirements of ruary 2016) differs from the date during highest market value in aggregate of all the permanent voluntary disclosure pro- which the trust should have held the as- undeclared assets as at the end of each gramme (the permanent tax VDP) as con- sets in order for an applicant to exercise year of assessment ending between 1 templated in the Tax Administration Act the election for purposes of the tax SVDP March 2010 and 28 February 2015. 28 of 2011 (the Act). A tax SVDP applica- (1 March 2010 to 28 February 2015 – as Applicants who have disposed of un- tion may not be made by or on behalf of a indicated above). declared assets, may elect to be deemed trust, although a trust may qualify under An applicant who successfully applies to have held such assets during such pe- the permanent tax VDP. (There are spe- for the regularisation of unauthorised riod, but at the market value while the cific rules for trusts in the tax SVDP dis- offshore assets in terms of the excon assets were actually held (or a reason- cussed below). In addition, no tax SVDP SVDP will be required to pay a levy based able estimate thereof). application may be made in respect of an on the market value of such assets as at The draft legislation provides that an asset that has been disclosed to Sars in 29 February 2016 as follows: applicant who is a donor (or deceased terms of an international tax agreement, • A levy of 5% will be payable on the estate thereof) or beneficiary of an off- or in respect of applicants who are under value of unauthorised foreign assets or shore discretionary trust may in cer- actual or pending audit or investigation the sale proceeds thereof if such assets tain circumstances elect that the assets, into these matters. are repatriated to South Africa. Such which such trust held during the period The SVDP is focussed on offshore as- levy must be paid from foreign-sourced 1 March 2010 to 28 February 2015 be sets held by a person during the period 1 funds. deemed to be held by the applicant for March 2010 to 28 February 2015, which • A levy of 10% will be payable on the val- all tax purposes, in order for such assets assets were wholly or partly derived ue of unauthorised assets if such assets to fall within the ambit of the tax SVDP, from amounts not declared to Sars for are retained abroad. The 10% levy must to overcome the exclusion of trusts from income tax or estate duty purposes (un- be paid from foreign sourced funds, fail- relief. declared assets). ing which the levy will be increased to The relief provided in the tax SVDP 12%. would be available to a successful appli- The exchange control Applicants will not be allowed to de- cant in addition to the voluntary disclo- SVDP (excon SVDP) duct any exchange control allowance sure relief currently available in terms of from any leviable amount and the levy the permanent tax VDP. Accordingly, in Information pertaining to the excon may not be reduced by any fees or com- terms of the draft legislation read with SVDP was released in terms of Exchange missions (for example, fees incurred in the Act, a successful tax SVDP applicant Control Circular No 6/2016 on 13 July order to sell the relevant asset and repat- would be entitled to the following relief: 2016 (the circular) (www.resbank.co.za, riate same to South Africa). Should an applicant qualify for tax SVDP accessed 27-7-2016). The circular indi- It will remain possible for persons to

DE REBUS – SEPTEMBER 2016 - 20 - BOOKS FOR LAWYERS approach the FSD on a voluntary basis quences could be severe. In addition to to 9 September at Vodaworld Conference outside of the excon SVDP regime to criminal prosecution, inter alia, under- Centre in Johannesburg. Visit www.tax- regularise their affairs. A settlement statement penalties of up to 200% of any indaba.co.za for more. amount ranging from 10% to 40% of the tax default may be leviable in terms of market value of the unauthorised assets the Act and exchange control levies of Robert Gad BA LLB LLM (UCT) Post may then be levied. up to 100% of the market value of un- Grad Dip in Tax (UCT) and Alexa Should a person be in default as to authorised offshore assets may be levied Muller BCom LLB (Stell) H Dip in Tax their tax and/or exchange control affairs by the FSD. are attorneys at ENS Africa in Cape and not opt to regularise same in terms At the time of writing this article, the Town. Mr Gad is also the Chairper- of the SVDP regime, the permanent tax draft legislation was open for public son of the LSSA Tax and Exchange VDP, or voluntary approach to the FSD comment until 8 August. Control Committee. outside of the excon SVDP, the conse- • The 2016 Tax Indaba takes place on 5 q

Criminal Law in South Africa

By Gerhard Kemp (ed) Cape Town: Oxford University Press (2015) 2nd edition Price: R 509,95 (incl VAT) 698 pages (soft cover)

his book by Gerhard Kemp, can obviously refer to the cases which wise rigorous theory. One of the chapters as editor, is core course ma- are cited. Not all the cases in criminal (ch 2) even provides for a broad outline terial for any student, but law are referred to but only those which of the South African criminal procedure by no means is this book a are important for the understanding of system. mere academic treatise on each section are briefly discussed. The Criminal law being a practical subject criminal law and may be re- information is presented in a well-struc- has to be taught in a practical way with- Tgarded as a definitive work on the sub- tured and user-friendly manner and is out ignoring the principles on which it ject. It is a book that is aimed at both the easily readable. is based. It is often illuminating to know law student, as well as the practitioner The general principles of criminal why a particular provision has been and both can equally benefit from it. It is law, the elements of specific common made. Any book that deals with princi- a book that sets out the most important law crimes and statutory offences are ples of substantive law has to captivate provisions of all related legislation and all covered in the text. The influence of the imagination of the reader and draw comments on the important sections the Bill of Rights read with comparative his attention to the value of this sub- thereof. Each section deals with applica- perspectives and international law on ject. It is guaranteed that this book will ble case law to substantiate the substan- each subject, supports the legal theory achieve this objective and will also be a tive law. It is then followed by concise referred to. useful guide to practitioners. It will defi- notes on the salient features of the sec- Reading any act is on its own rather nitely be a worthy addition to the litera- tion. These notes are largely based on dry and uninteresting. These notes make ture on this subject. case law, which reveals how each section it more digestible for the reader. They I was extremely impressed by the has been interpreted and applied in prac- are written in clear and lucid language book’s introduction to several new tice. Sometimes background information and all essential material is canvassed. offences, such as the criminal provisions is provided and fundamental principles The work is comprehensive and the prac- of the Companies Act 71 of 2008, as well enunciated. The information is up-to- tical explanation straight forward. as crimes such as terrorism, torture and date and the format eminently helpful. Although this book is of immense human trafficking which are all treaty- The book provides an in-depth debate value for the student, it is equally useful based and a world-wide phenomena. and analysis of contentious issues, as to a practitioner who needs a quick ref- This textbook is available at most well as recent legal developments on the erence to a particular provision or who academic bookshops through-out South topic at hand. needs some guidance on a moot point Africa and also directly from Oxford Uni- The notes which accompany each sec- of criminal law. The usefulness of the versity Press at www.oxford.co.za. tion are sufficiently detailed. They deal book is enhanced by the word index at with more than the bare essentials. They the end. Not to repeat myself, sufficient Dr Llewelyn Gray Curlewis is an at- do not engage in profound academic dis- to say that this book succinctly explains torney at Pieterse & Curlewis Inc in cussion. Anyone who wants to go into criminal law principles with excellent Pretoria. q an in-depth discussion of each provision case illustrations, to balance out other-

DE REBUS – SEPTEMBER 2016 - 21 - By Kristen Wagner and Claire Brett

Picture source: Gallo Images/iStock I heard it through the grapevine: The di erence between legal professional privilege and con dentiality

n the context of legal professional ethics, the terms ‘confidentiality’ and ‘privilege’ are often used interchangeably. While these two terms may overlap in some respects,I they remain two distinct concepts. The distinction between confidentiality and legal professional privilege is absolutely essential insofar as their differences ensure the proper functioning of the South African legal system, which is dependent on freedom of communication between legal practitioners and their clients.

DE REBUS – SEPTEMBER 2016 - 22 - FEATURE – LAW OF EVIDENCE

A brief consideration of ments for legal professional privilege to Sutherland J remarked that the right to apply, namely: legal professional privilege is a ‘nega- confidentiality • The legal practitioner must have acted tive right’ making inadmissible as evi- ‘Confidentiality’ refers to the duty of an in a professional capacity. This goes dence, legal advice provided to a client attorney to preserve the confidentiality beyond the mere fact that the legal by a legal practitioner. This right cannot of all communications between himself practitioner is an admitted attorney or be interpreted as being a positive right, or herself and the client (Willem de Klerk advocate. Other indicators such as the which would otherwise entitle a client et al Clinical Law in SA 2nd (Durban: payment of fees or recorded holding of to suppress publication once confiden- LexisNexis 2006) at 42). The norm is that consultations may also be considered for tiality has already been breached. As this duty may present itself as an express this requirement to be met. such, legal professional privilege cannot or tacit term of a contract, by virtue of a • The client must have consulted with be claimed against the world at large; fiduciary relationship or even in terms the legal practitioner in confidence. At providing protection from involuntary of a delictual duty prohibiting such dis- this point, the overlap between confi- disclosure. Granting of an interdict in closure. Confidentiality is said to be far dentiality and privilege becomes appar- circumstances where harm has already wider than the doctrine of legal profes- ent as confidentiality is a necessary pre- occurred is futile. As such, once the pub- sional privilege as information may be condition for the claiming of privilege. A lic becomes aware of confidential legal confidential even when it is not protect- communication must have been intended ed by legal professional privilege. Confi- to be confidential for it to be privileged. communications between the client and dentiality extends to all information in This requirement applies to all commu- legal practitioner, no remedy exists to respect of the clients’ affairs, whether nications between the legal practitioner restrain further dissemination. (See law oral or documentary in nature. The right and client, whether written or oral. This reports ‘Civil Procedure’ 2016 (June) DR to have communications protected be- requirement is often contested and one 40 and ‘Evidence’ 2016 (June) DR 44.) longs solely to the client and only the may find confidentiality is absent where, • The advice given must not facilitate the client will be able to expressly waive this for example, the attorney acts for both commission of a crime or fraud. This ap- right (De Klerk op cit). This duty survives parties in a case. plies regardless of the fact that the at- termination of the mandate between at- • The communication must have been torney may be completely unaware of torney and client and even the death of made for the purpose of obtaining legal such crime or fraud. In the case of Waste the client. This (mostly) contractual duty advice (or, at the least, closely connected Products Utilisation (Pty) Ltd v Wilkes and is essential insofar as it ensures that the thereto). A distinction is drawn between – Another 2003 (2) SA 515 (W), a tape re- client is (without fear) able to confide in – legal advice privilege, which pertains cording was introduced into evidence and disclose all relevant information to to all communications between the legal wherein the defendant, in discussion the legal practitioner insofar as it per- practitioner (attorney/advocate/salaried with his attorney, intended to fabricate tains to the circumstances or case. Legal in-house legal adviser) and the client (in evidence in order to mislead the court. practitioners must ensure that confiden- order to give the client advice in a pro- While accepting that the tape recording tiality is respected, protected and upheld fessional capacity); and was unlawfully made, the court admit- at all times. A breach of this duty by a le- – litigation privilege, which pertains to ted it into evidence; stating that the legal gal practitioner may lead to an action for and protects all communications be- professional privilege so claimed by the damages against himself or herself or tween the legal practitioner and the defendant was forfeited as a result of the may culminate in the granting of a pro- client or between either of them and a hibitory interdict against further disclo- third party with respect to actual or con- criminal intention behind the communi- sure. The duty of confidentiality remains templated litigation, insofar as the case cation. in effect at all times and not just in the is in the process of investigation and/or In addition, legal professional privi- face of legal demands for information. preparation for trial. lege will not apply to communications, In the recent case of South African Air- which are not intended to be privileged, Demarcating the ways Soc v BDFM Publishers (Pty) Ltd and communications not intended to be con- Others 2016 (2) SA 561 (GJ) [2016] 1 ALL fidential, the name of the client and facts distinction: Understanding SA 860 (GJ), the court was tasked with learnt through the legal practitioners legal professional privilege considering the applicability of an inter- own means and methods (De Klerk op cit dict as a form of relief to an applicant at 42). The privilege belongs to the client The International Code of Ethics prohib- whose confidential legal advice had been and only the client may expressly waive its legal practitioners from disclosing, leaked into the public domain in an un- such privilege. unless lawfully ordered to do so by a authorised manner. In the case of Mohamed v President of court or in terms of statute, communica- The applicant, South African Airways the Republic of South Africa and Others tions made to them in their capacity as (SAA), had previously sought and ob- 2001 (2) SA 1145 (CC) it was held that legal practitioners, even after ceasing to tained an interdict against the respond- legal professional privilege extends to be the client’s attorney/legal practitioner ents (three media houses) preventing salaried legal advisers in the employ of (J Auburn Legal Professional Privilege: further dissemination of a legal impact the government. Furthermore and in Law and Theory (USA: Hart Publishing analysis document prepared by SAA’s in- terms of Van der Heever v die Meester en 2000) at 23). On this basis, one needs house legal adviser. In November 2015 Andere 1997 (3) SA 93 (T) legal profes- to consider the doctrine of legal profes- the confidential legal text was leaked sional privilege was further extended to sional privilege as it applies in South and published in various national news- Africa. This doctrine maintains that cer- papers. salaried legal advisers in the employ of a tain communications between practi- In setting aside the previous order, private body such as a firm giving tax ad- tioners and clients may not be used in Sutherland J emphasised the distinc- vice. The courts are not, however, willing evidence. tion between legal advice and litigation to extend privilege to persons giving le- As delineated in Thint (Pty) Ltd v Na- privilege; delineating that while the gal advice who do not have a law degree, tional Director of Public Prosecutions and common law right to legal professional which would enable them to be admitted Others; Zuma v National Director of Pub- privilege is a necessary means of pro- as an attorney or advocate. An example lic Prosecutions and Others 2009 (1) SA tecting South Africa’s adversarial jus- hereof would be a chartered accountant 1 (CC) there are said to be four require- tice system, it is not an absolute right. giving tax advice.

DE REBUS – SEPTEMBER 2016 - 23 - FEATURE – LAW OF EVIDENCE

Relevant examples of the lege. In terms of sch 1 of FICA, account- Conclusion able institutions such as banks and at- The contractual duty of confidentiality applicability of legal torneys are required to comply with professional privilege and the common law doctrine of legal various duties. The most contested of professional privilege are essential in and statutory challenge? these duties is the onerous duty placed maintaining the independence of the on accountable institutions to report all In the recent case of A Company and legal profession and in assuring clients suspicious activities or transactions to that any information communicated be- Others v Commissioner, South African the Financial Intelligence Centre (FIC). Revenue Service 2014 (4) SA 549 (WCC) it tween them and the legal practitioner Failure to report any suspicious activi- was held that certain portions of the ap- will not be disclosed. Confidentiality ties relating to the client may result in plicant’s attorney’s tax invoice were pro- remains in effect infinitely while legal a hefty fine being imposed on the prac- tected from disclosure due to legal pro- professional privilege must be claimed titioner of up to R 10 million or up to fessional privilege. In the past, whenever by the client and generally ensures that 15 years’ imprisonment. It is argued that South African Revenue Service (Sars) re- all communications between client and the inclusion of attorneys in anti-money quired information from a taxpayer re- legal practitioner are not admissible in laundering legislation such as FICA is garding an audit or interview, the tax- subsequent legal proceedings. unconstitutional and threatens the inde- payer could refuse on the grounds of While FICA and the Tax Administra- the information being legally privileged. pendence of the legal profession. There tion Laws Amendment Act 23 of 2015 However, in terms s 42A of the Tax Ad- is a need to maintain the rules of legal present concerns for legal practitioners ministration Laws Amendment Act 23 of professional privilege in order for the insofar as the doctrine of legal profes- 2015, a taxpayer claiming the applica- legal profession to remain independent. sional privilege is concerned, we remain bility of legal professional privilege will Such duties erode away at the doctrine of hopeful that such concerns will be rem- now have to prove the validity of such legal professional privilege. Suggestions edied in the near future; preserving this privilege by providing a list of extensive have been made, which include FICA be- essential doctrine. information which includes – but is not ing amended to allow attorneys to report suspicious transactions to the provincial limited to – a description of each and Kristen Wagner BA Law and Psychol- law society as opposed to the FIC. As it every document not provided and full ogy (Rhodes) LLB (cum laude) (UJ) is a stands, FICA provisions – as they apply details of the legal practitioner. financial crime risk graduate trainee to attorneys – remain in force as it is Interestingly, and as another topical at FNB in Johannesburg. Claire Brett contended that attorneys are often used issue currently being considered, the is a student assistant at the Soweto Financial Intelligence Centre Act 38 of by money launderers and their trust ac- Law Clinic in Johannesburg. 2001 (FICA), provides major barriers to counts are most often the vehicles used the doctrine of legal professional privi- to launder money. q

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DE REBUS – SEPTEMBER 2016 - 24 - Legal JUTA LAW information New releases and solutions you key resources can trust.

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3780-08-16 Latest information Solution DeRebus.indd 1 16/08/2016 10:19 When is it appropriate for the sentencing court to interfere with parole? Picture source: Gallo Images/iStock

By Nicholas Mgedeza and Dumisani Masuku

n practice there are judicial offic- (c) periodical imprisonment; 2015) (Thobane AJ), which was brought ers who impose a sentence that (d) declaration as a habitual criminal; to the High Court under special review. the accused will undergo a cer- (e) committal to any institution estab- The synopsis of the mischief is that after tain period of imprisonment and lished by law; the accused pleaded guilty to the charge will not be eligible for parole. In (f) a fine; of fraud, the magistrate sentenced the the matter of S v Mpharu (FB) (un- (g) … accused to 36 months’ imprisonment reported case no 147/2014, 4-9- (h) correctional supervision; and simultaneously ordered that the ac- I2014) (Pohl AJ), the matter was brought (i) imprisonment from which such a cused will not be eligible for parole for under special review, after the accused person may be placed under correctional a period of 36 months. The court held in the matter had been charged on 23 supervision in the discretion of the Com- that the fact that the order of non-parole June 2014 with ‘housebreaking with the missioner or a parole board.’ covered the entire term of imprisonment intent to steal and theft.’ He was legally At the first instance, the statute does was misdirection. On this point alone represented and pleaded guilty to the not provide for circumstance where the the magistrate’s order of imposing of charge and was duly convicted. Subse- court can order the accused not to be non-parole sentence was accordingly set quently, the magistrate imposed a sen- entitled to parole. Section 276B(1) and aside. The court further held that the ap- tence of three months’ imprisonment (2) of the CPA provides that: proach to be adopted by the sentencing and further made an order that the ac- ‘(1)(a) If a court sentences a person court that wishes to impose the non-pa- cused would not be eligible for parole. convicted of an offence to imprisonment role period is to make a determination In this article, we scrutinise whether the for a period of two years or longer, the as to whether exceptional circumstances magistrates’ courts are vested with the court may as part of the sentence, fix a are present and in casu such circum- powers to impose a sentence where pa- period during which the person shall not stances did not exist. Furthermore, in role is denied? What does the Criminal be placed on parole. the matter of S v Pauls 2011 (2) SACR Procedure Act 51 of 1977 and the au- (b) Such period shall be referred to as 417 (ECG), pursuant to plea of guilty to thorities say in this regard? What factors the non-parole-period, and may not ex- a charge of theft, the regional magistrate does the judicial officer need to take into ceed two thirds of the term of imprison- sentenced the appellant to undergo eight account in determining a sentence that ment imposed or 25 years, whichever is years of imprisionment, two of which the prisoner should not be entitled to be the shorter. were suspended for five years on certain paroled or have his sentence remitted? (2) If a person who is convicted of two conditions. The magistrate also imposed or more offences is sentenced to impris- a further condition, in terms of s 276B of Law and analysis onment and the court directs that the the CPA that the appellant had to serve Section 276(1) of the CPA provides that: sentences of imprisonment shall run a minimum of four years of the sentence ‘(1) Subject to the provisions of this Act concurrently, the court shall, subject to before he could be considered for parole. and any other law and of the common subsection (1)(b), fix the non-parole-pe- The court held that s 276B should be in- law, the following sentences may be riod in respect of the effective period of voked in exceptional circumstances, and passed on a person convicted of an of- imprisonment.’ the court must exercise proper care and fence, namely – Undoubtedly, this section confers the caution when considering whether ex- (a) … court the right to curtail the time of which ceptional circumstances exist. Moreover, (b) Imprisonment, including impris- the prisoner must be kept in detention the court held that the proper judicial onment for life or imprisonment for an prior to being eligible for parole. By way considerations can only be considered indefinite period as referred to in section of illustration, the matter of S v Kodisang where both the state and the defence 286B(1); (GP) (unreported case no A421/15, 20-6- have made submissions on the issue;

DE REBUS – SEPTEMBER 2016 - 26 - FEATURE – CRIMINAL LAW & PROCEDURE

and where exceptional circumstances ‘As was already hinted above, the arbitrary and is a flagrant disregard of are found to exist in a particular case; it Department of Correctional Services, the constitutional right of a prisoner as is the duty of the judicial officer to set the parole board or their employees it contravenes s 12 of the Constitution. them out explicitly in the judgment or are empowered to consider such things Prof Devenish A commentary on the they must be apparent therefrom (see as recommendations for parole. They South African Constitution 6ed (Durban: also S v Mogaga 2014 JDR 0582 (GSJ)). might not interpret the parole legisla- LexisNexis 2004) at 240 provides the fol- Both of the aforementioned cases, con- tion correctly or refuse parole for flimsy lowing: ‘The judiciary dare not to usurp firm the position that prior to the impo- reasons, which means that a person, al- the function and role of the legislature. sition of s 276B sentence, discernible ex- though legally entitled to be considered This will constitute a violation of the ceptional circumstances must be present for release on parole, might not be re- doctrine of separation of powers. The and must emanate from both the state’s leased. This is not a far-fetched, specula- creative role of the judiciary in interpret- and the defence’s submissions and the tive hypothesis, as the premature release ing and applying the Constitution and judicial officer must set them out in the of some of the so-called “Waterkloof other statute law must be exercise within judgment. Four” due to a miscalculation of the leg- the clearly defined parameters.’ The right to be heard and to be given islative requirements bears testimony. The main objective of the separation the opportunity or to be considered to The same mistake can just as easily be of powers is to enforce the notion of be eligible for parole is to a certain ex- made regarding an omission to consider, checks and balances and the Constitu- tent circumscribed by the aforemen- or refusal to release on, parole. Once tion depicts the legislature, the execu- tioned sections in that the prisoner will again, therefore, sentencing and ap- tive and the judiciary as separate enti- have to be incarcerated for a stipulated peal courts should not rely on the cur- ties, each with a distinctive backdrop. period before the issue of parole can rent parole provisions and policies when Thus, when the court imposes a sentence be condisered. Our submission is that determining an appropriate sentence. which provides that the prisoner is not this does not confer automatic right to While the date for consideration to be entitled to parole, it is usurping and en- parole, but places the prisoner in a posi- released on parole is now the same for croaching on the executive function, to tion to be considered for a parole by the everyone, lifers or people sentenced to wit, Correctional Services Department, Parole Board. In the matter S v Stander otherwise unreasonably long periods of the latter being an entity vested with the 2012 (1) SACR 537 (SCA) at para 12 and imprisonment such as 100 years, the fact right by the legislature to entertain the 13 respectively, the court held that: ‘De- remains that some of them might not be dynamics of parole. spite the fact that s 276B grants courts so considered or released, and their rem- the power to venture onto the terrain edies might be limited to obtain redress. Conclusion traditionally reserved for the execu- No one can lose sight hereof, especially The sentence, which provides that the tive, it remains generally desirable for a not sentencing courts or courts of ap- prisoner is not eligible for parole, is in court not to exercise that power. … Ul- peal. Parole is the function of the execu- contravention of the principles of legal- timately, the case-management commit- tive arm of government, and the courts ity, the doctrine of separation of powers tee submits a report on each prisoner should steer well clear of interfering, un- and is arbitrary. It stands to be severed to the relevant Correctional Supervision less authorised by law to do so.’ from the sentence and the parole board and Parole Board. The report deals with In principle, the issue of whether the (executive) will deal with the issue of the conduct, disciplinary record, adapta- prisoner is eligible for the parole falls parole at the appropriate time. Where tion, training, aptitude, industry, physi- exclusively within the purview of the a magistrate seeks to invoke the s 276B cal and mental state of the prisoner and executive, not the judiciary. The execu- sentence, they must determine whether the likelihood of his or her relapse into tive has to follow certain procedures there are exceptional circumstances and crime. In order to fulfil these functions and processes in formulating an opinion they must spell them out in their judg- the Department employs suitably skilled whether to confer parole to the prisoner ments. Lastly, in order to militate the people. The Correctional Supervision (see also S v Tcoeib 1996 (1) SACR 390 encumbrance of the High Court, judges and Parole Board considers the report (NmS) at 394 B – C). with legion special reviews, the magistra- submitted to it and also takes into ac- cy needs to exercise great caution when count the views of the complainant in Separation of powers applying s 276B sentence and must ut- certain identified instances of serious outlook terly obviate imposing the sentences crime. Such a complainant has the right without parole, as this is not distinctive in terms of s 299A of the Act to attend Section 8(1) of the Constitution provides from encroaching on the executive ter- the meeting of the Correctional Supervi- that ‘The Bill of Rights applies to all law, rain. sion and Parole Board and make repre- and binds the legislature, the executive, sentations when the parole of the per- the judiciary and all organs of state.’ Ac- • See feature articles ‘Understanding petrator is considered. This serves to cordingly, the courts fall under the am- imprisonment – an in-depth discussion’ illustrate that the consideration of the bit of judiciary. Furthermore, s 165(2) of 2016 (June) DR 34; ‘Understanding pa- suitability of a prisoner to be released on the Constitution provides that the courts role – an in-depth discussion’ 2016 (July) parole requires the assessment of facts are independent and subject only to the DR 34; and ‘Understanding parole – an relevant to the conduct of the prisoner Constitution and the law, which they in-depth discussion continued’ 2016 after the imposition of sentence. This must apply impartially and without fear, (Aug) DR 22. short summary of the statutory proce- favour or prejudice. Without a shadow dure prescribed for the consideration of of a doubt, the Constitution applies and a prisoner’s release on parole illustrates binds the courts. Moreover, s 12(1)(e) of why the Department, and not a sentenc- the Constitution, provides for the right ing court, is far better suited to make de- ‘not to be treated or punished in a cruel, cisions about the release of a prisoner on inhuman or degrading way’. As a point Nicholas Mgedeza BProc (Unisa) is a parole and why it remains desirable to of departure, the courts that impose a state attorney in Pretoria. Dumisani respect the principle of the separation of sentence, which has the express provi- Masuku LLB (University of Zululand) powers in this regard.’ sion that the prisoner will undergo a cer- is an advocate in Boksburg. Likewise in S v Mahlatsi 2013 (2) SACR tain period of direct imprisonment and 625 (GNP), at para 27, the court held that: is not entitled to remission or parole, is q

DE REBUS – SEPTEMBER 2016 - 27 - By Sherika Maharaj Gallo Images/iStock Picture source:

Dying declaration – should the dead have a say in a matter? The history of the ‘dying Admissibility is depended on the fol- its admissibility is based on two broad lowing factors: grounds namely necessity and reliability. declaration’ • The statement must be one, which the The test of whether or not a dying decla- The dying declaration is based on the deceased could have repeated in court ration is an opinion is ‘whether the state- Latin maxim ‘nemo moriturus praesumi- had he or she lived. Therefore, if the de- ment is the direct result of observation tur mentiri’. Literally translated it means ceased was not a competent witness or if through the declarant’s senses, or comes ‘a man will not meet his maker with a the statement itself was based on inad- from a course of reasoning from col- lie in his mouth’. It originated in English missible hearsay evidence, then it could lateral facts’ (LM Katz ‘Admissibility of law. not be admitted as a dying declaration. Opinions in Dying Declarations – Connor As early as the 1720’s, the use of the • The death of the deceased must be v State’ (1962) 22 Maryland Law Review dying declaration was used as an excep- the subject, both of the charge and the 42 at 44). If it is the former, it is admis- tion to the hearsay rule and was admis- statement itself and were held to be in- sible; if it is the latter, it is inadmissible. sible, provided it complied with certain admissible under the head of charges of legal principles set out under English perjury, robbery or rape. The position in SA prior to common law. • The statement must be made in the 1988 The hearsay rule is a rule of evidence, ‘settled, hopeless expectation of death’. In SA the provisions of s 223 of the Crim- which prohibits admitting testimony or Death must be expected soon albeit not inal Procedure Act 51 of 1977 (CPA) gov- documents into evidence when the state- immediately. If the deceased entertains erned the admissibility of a dying decla- ments contained therein are offered to even a faint hope of recovery at the time ration, and read as follows: prove their truth and the maker of the he or she makes the statement, it will be ‘The declaration made by any de- statement does not testify and is not excluded. ceased person upon the apprehension subject to cross-examination on the con- of impending death shall be admissible tents thereof. One of the earliest or inadmissible in evidence if such dec- In South Africa (SA) we adopted the decisions on the laration would have been admissible or English common law and followed the inadmissible as evidence on the thirtieth same legal principles. admissibility of a dying declaration day of May 1961.’ Applicable legal principles In the 1961 American decision of Connor The position in SA after The English principles were set out in v State 171 A.2d 699 (Md.1961), the Mar- State v Gabatlwaelwe 1996 BLR 540 (HC). yland Court of Appeal had to consider 1988 The court held that the dying declara- whether evidence admitted at the trial, The Law of Evidence Amendment Act 45 tion is a statement that may be oral or which consisted of a statement made by of 1988 (the Act), changed how courts written or taken in the form of signs or the deceased to the police, was inadmis- dealt with the evidence of a dying decla- gestures. It need not be made with the sible as a dying declaration due to its ration. Section 9 of the Act repealed the deceased’s dying words or dying breath. opinion form. The court held that dying provisions of s 223 of the CPA. Although used in cases to incriminate declarations made under certain condi- Hearsay evidence under the Act means the accused, they are equally admissible tions are admissible as an exception to evidence whether oral or in writing, the in his defence. the hearsay rule. The justification for probative value of which, depends on the

DE REBUS – SEPTEMBER 2016 - 28 - FEATURE – LAW OF EVIDENCE credibility of any person other than the In S v Shuping (NWM) (unreported case counted from the body of evidence im- person giving such evidence. no CC161/05, 1-1-2006) (Hendricks J), plicating the applicant, the remaining Section 3 provides: the accused, Mrs Shuping, was convict- evidence would still be sufficient to sus- ‘(1) Subject to the provisions of any ed of murder and arson. The state did tain his conviction.’ other law, hearsay evidence shall not be not have any eyewitnesses but relied on In Van Willing and Another v State admitted as evidence at criminal or civil circumstantial and hearsay evidence. (SCA) (unreported case no 109/2014, proceedings, unless – The hearsay evidence consisted of state- 27-3-2015) (Schoeman AJA) the SCA had (a) each party against whom the evi- ments, which the deceased allegedly to deal with the admissibility of hearsay dence is to be adduced agrees to the made to state witnesses shortly after he evidence in terms of s 3(1)(c) of the Act. admission thereof as evidence at such was burned. The state applied to have The person who made the statement was proceedings; evidence admitted in terms of s 3(1)(c) the deceased, after he was shot. The ap- (b) the person upon whose credibility of the Act. Henricks J stated that the pellants were convicted of murder. The the probative value of such evidence de- hearsay evidence must be excluded un- state elicited evidence that the deceased pends, himself testifies at such proceed- less he was of the opinion that it should told at least three witnesses the iden- ings; or be admitted in the interests of justice. tity of the perpetrators. The SCA, when (c) the court, having regards to – The court had regard to each of the six dealing with the probative value of the (i) the nature of the proceedings; considerations in the Act. The court held evidence, assessed it under two heads, (ii) the nature of the evidence; that it was not necessary to determine namely, the reliability and complete- (iii) the purpose for which the evidence conclusively whether the deceased’s ness of the witness transmission of the is tendered; statements would definitely have quali- deceased’s words and the reliability and (iv) the probative value of the evidence; fied either as a dying declaration or completeness of whatever it was that the (v) the reason why the evidence is not spontaneous statement. It held that ‘the deceased did say. The court found that given by the person upon whose credibil- interests of justice demands the admis- the admission of the hearsay evidence ity the probative value of such evidence sibility of the hearsay evidence and there was in the interests of justice. depends; is compelling justification for admitting When a court admits hearsay evidence (vi) any prejudice to a party which the and relying on that evidence’. after exercising its discretion in terms of admission of such evidence might entail; In S v Ramavhale 1996 (1) SACR 639 s 3(1)(c), it has the effect that the per- and (A) Schutz JA stated that ‘a Judge should son who made the statement cannot be (vii) any other factor which should in hesitate long in admitting or relying on cross-examined. The question that arises the opinion of the court be taken into hearsay evidence which plays a decisive is whether this is in conflict with an ac- account, is of the opinion that such evi- or even significant part in convicting an cused’s constitutional right to challenge dence should be admitted in the inter- accused, unless there are compelling evidence. The SCA in S v Ndhlovu and ests of justice.’ justifications for doing so.’ Hearsay evi- Others 2002 (2) SACR 325 (SCA) held dence was long recognised to be unreli- that it is not. The SA courts approach able and continues to be so. He further post 1988 stated that: ‘An accused person usually Procedure to be followed In S v Mbanjwa and Another 2000 (2) has enough to contend with without ex- when a party wishes to SACR 100 (D), the High Court dealt with pecting him also to engage in mortal introduce hearsay evidence combat with the absent witness.’ the admissibility of statements made In the Ndhlovu matter, Cameron JA, al- In S v Mpofu 1993 (2) SACR 109 (N) by the deceased prior to her death. The luded to a careful approach to be fol- it was held that the reception of hear- state and defence conceded that this was lowed before such evidence will be ad- say evidence under s 3(1)(c) of the Act hearsay evidence. mitted at a criminal trial. The court must ‘should not logically be divorced from a The court considered the following, be asked clearly and timeously to con- consideration of those factors which at namely: sider and rule on its admissibility. It was common law made for admissibility or • The six considerations in s 3(1)(c) of the stated that an accused cannot be am- not.’ Act. bushed by the late or unheralded admis- In Mzizi v S [2009] 3 All SA 246 (SCA) • That this was a criminal case and the sion of hearsay evidence and before the the Supreme Court of Appeal (SCA) dealt reluctance of courts to permit untested state closes its case the judge must rule with the admission of the statement by evidence against an accused. on admissibility so that the accused can the deceased to the police officer iden- • The witnesses who testified were in- appreciate fully the evidentiary ambit he tifying his attacker after he was shot dependent, unbiased, impressive and or she faces. truthful and that their evidence was sub- and before he died. It was argued that stantially true. the statement was inadmissible hearsay Conclusion evidence and that the court should not • The court assessed the reliability and Our courts do not like to strictly clas- have admitted it as evidence. This was completeness of what the deceased said sify a statement as a dying declaration by considering the sincerity, memory, regarded as a dying declaration. The SCA or a spontaneous statement. They accept perception and narrative capacity of the held that there can be no doubt that the that statements of the deceased are hear- witnesses. statement uttered by the deceased, if it say in nature and apply the provisions • The court considered that the deceased was admitted to prove the identity of his of s 3 of the Act to determine admissi- statement could have been admissible killer, constitutes hearsay evidence. The bility. More often than not courts admit under the common law exceptions to the court held that: ‘Although it is arguable the statements if it is in the interests of rule against hearsay evidence, namely that the statement in question was ad- justice. dying declarations and spontaneous mitted in compliance with the require- statements. ments of section 3(1)(c), for the purposes The court found that there were cer- of this judgment, I am willing to assume tain safeguards present in the objective in the applicant’s favour that its admis- facts which guaranteed the reliability of sion did not comply with that section. I Sherika Maharaj LLB (Unisa) is an at- the hearsay evidence and concluded that am willing to assume further that such torney at Legal Aid in East London. it was in the interests of justice that it be failure amounted to an irregularity. For, admitted. if the utterance by the deceased is dis- q

DE REBUS – SEPTEMBER 2016 - 29 - Picture source: Gallo Images/iStock Evictions – a sad reality in

By Madeleine South Africa Truter

outh Africa’s history is one ing tenants. Satisfactory grounds for or more structured processes involving where the majority of people eviction under the PIE Act exist when an in-depth negotiations between municipal have been deprived of land, occupier – officials, private landowners, communi- and have experienced a lack of • did not make payment of rental; ties and the organisations supporting access to housing. • is a nuisance to the neighbours; them. Our Constitution took effect • causes damage to the property; The third general principle is that evic- Son 4 February 1997, and s 26(3) pro- • has a fixed lease, which has not been tions, which might lead to homelessness, vides that no one may be evicted from renewed, has subsequently expired, and are never just private disputes – they al- their homes, or have their homes demol- has been properly terminated in terms of ways involve the state – whose duty to ished, without an order of court, made the provisions of the lease agreement; or provide emergency housing may be trig- after considering all the relevant circum- • has breached provisions of an existing gered by an eviction. When there is a stances. lease agreement. possibility of people being left homeless, On 4 October 2000, the Constitutional An application under the PIE Act can relevant organs of state (usually munici- Court handed down its landmark judg- only be launched if the occupant of the palities) must be joined as necessary par- ment in Government of the Republic of property is considered to be in illegal ties to the legal processes for eviction. South Africa and Others v Grootboom occupation. In the event of a breach of and Others 2001 (1) SA 46 (CC). Irene any provision of the lease agreement, What is a ‘home’? Grootboom, a housing rights activist, the provisions of the breach clause of To date, the Constitutional Court has not was made famous when the Constitu- the lease agreement should be followed. finally decided the question of what con- tional Court found in her favour and In addition to basic requirements such stitutes a ‘home’. The question of wheth- held that the South African Government as proper notice of the eviction proceed- er a structure is a home must be decided had not met its obligation to provide ings being served on the persons con- by a court, which properly evaluates the adequate housing for the residents of cerned, three major principles have been background and circumstances of the Cape Town’s Wallacedene informal set- established by the South African courts people who built the structure, and the tlement. The ruling provided clear legal in their interpretation of the PIE Act. reasons for its construction. The Socio- support for housing-rights campaigns in The first principle is that people Economic Rights Institute of South Af- South Africa. It is ironic and tragic that should generally not be evicted into a rica (SERI) made the following argument: at the time of her death in August 2008, situation of homelessness. Temporary ‘The primary determinant of whether a she was still living in a shack. alternative accommodation should be shack is a “home” must surely be what provided to those facing homelessness else is available to the person who con- The PIE Act by the relevant public authorities, usu- structed it. If the person who construct- The Prevention of Illegal Eviction from ally municipalities. ed the shack was homeless before, and and Unlawful Occupation of Land Act The second principle is that people would be homeless if it was demolished, 19 of 1998 (PIE Act) governs the eviction facing eviction from their homes should it requires little imagination to conclude process in the event of a land invasion. be given a meaningful opportunity to that the shack itself – however modest or The aim of the PIE Act is to protect both participate in the resolution of the evic- ill-furnished – is his or her home’ (Fisher the occupiers and the landowners. All tion dispute. This can take the form of and City of Cape Town v Ramahlele and residential tenants are covered by PIE, mediation (where a third party tries to 46 Others (‘Fisher interdict application’) including illegal occupants and default- assist the parties to reach an agreement), (www.seri-sa.org, accessed 22-7-2016)).

DE REBUS – SEPTEMBER 2016 - 30 - FEATURE – PROPERTY LAW

On 4 June 2014, the question as to (WCC) (unreported case no 13700/14, and social justice, welcomed Nuku AJ’s what constitutes a ‘home’, was consid- 14-12-2015) (Nuku AJ)) temporarily sus- ruling. NU researchers and attorneys ered by the Supreme Court of Appeal pended an eviction order against occu- assisted the residents during the court (SCA) in the case of Fischer and Another pants who have been living on the land action, stating in a press statement that: v Ramahlele and Others 2014 (4) SA 614 directly behind the Endlovini informal ‘Land occupations like this are common (SCA). The Fischer case involved an ap- settlement (known as the Newcastle In- in a city where security of tenure, access plication to court by the owner of land formal Settlement) in Khayelitsha, since to land and adequate housing is in short in Philippi East, Iris Fischer, for an or- May 2014 (Barbara Maregele ‘Court stops supply for many black working class der preventing the unlawful occupation City from evicting Newcastle residents’ families. … This latest judgment enforc- of her property by a number of people www.groundup.org.za, accessed 22-7- es the notion that the City purposefully erecting informal dwellings on her land. 2016). fails to engage meaningfully with poor In response to that application, mem- Nuku AJ lashed out at the City of communities. … Attempting to appeal bers of the community instituted legal Cape Town (the city) for its ‘failure to a clear cut order is an undue delay of proceedings against the city, who they engage’ with Newcastle’s residents be- the City’s constitutional responsibilities’ argued had destroyed more than 30 of fore obtaining an eviction order against (Maregele op cit). their structures on the land illegally. them. Nuku AJ handed down judgment This counter-application was based nearly five months after the court bat- Conclusion on a common law remedy known as a tle started, ordering that the eviction be Despite the progress made by the leg- ‘mandament van spolie’, which is aimed stayed. Just two months after erecting islature and judiciary to ensure that no at restoring possession to people who their structures in May 2014, the resi- South African is left homeless, land evic- have been unlawfully deprived of their dents claimed, they were informed that tions are still rampant, and officials on peaceful and undisturbed possession of the courts had granted an eviction order the ground are finding ways to circum- property (even if that possession is un- to the city. The residents then lodged vent the overarching test of ‘justice and lawful). The remedy is aimed at discour- a counter application, challenging the equity’, introduced by the PIE Act. A case aging people or public authorities from city’s compliance with the PIE Act. The in point is the argument being used by taking the law into their own hands by residents insisted that the city did not the City of Cape Town’s Anti-Land Inva- speedily restoring possession without comply with the eviction order granted sion Unit that they are ‘simply prevent- going into the merits of the underlying in 2014 by Western Cape High Court ing the occupation of private land by rights of the parties. The High Court held Judge Thandazwa Ndita. The city sub- removing unoccupied and incomplete that the demolition of the structures on mitted an application for leave to appeal structures’ (Sandra Liebenberg ‘What the land was unlawful, commenting that and challenged the ruling in the SCA. In the law has to say about evictions’ www. they were reminiscent of Apartheid style his judgment, Nuku AJ said the follow- groundup.org.za, accessed 22-7-2016), in evictions. Gamble J accordingly ordered ing: ‘[I]n a matter where a municipality other words that they have not breached the city to rebuild the structures. The applies for an eviction it is bound to act constitutional or legislative provisions city then appealed this judgment to the reasonably. Part of acting reasonably is as no ‘homes’ were destroyed, because SCA. The SCA held that the key issue in the engagement with those who are to the structures are supposedly not occu- the case was whether the affected com- be evicted as that ensures that they are pied and/or completed. munity members were in fact occupying treated with dignity in the process … but Given the strong winds which have the structures when these were demol- has also failed to provide reasons why.’ been destroying homes thus far, we can ished. If they were, then the city would Nuku AJ continued to state that instead only hope for strong winds of change have taken the law into its own hands of meeting with residents, the city chose that will persuade officials at all levels of and acted unlawfully in demolishing the to ‘dictate’ to the residents on what it government, as well as the private sec- structures. The residents would be enti- would be prepared to discuss. There was tor, to treat those facing homelessness tled to have the structures rebuilt and in other words no engagement with the in a way that promotes the value of hu- restored to them. However, if the struc- respondents prior to the launching the man dignity, which lies at the heart of tures were vacant and unoccupied (as the application for their eviction. The rea- the housing rights enshrined in the Con- city alleged) then the city was entitled sons provided in support of the eviction stitution. In the words of Albie Sachs J: to remove them. The SCA held that the application were that some residents re- ‘It is not only the dignity of the poor that High Court should have heard evidence fused to give their details, were hostile, is assailed when homeless people are on whether the structures were occupied and threatened officials. Justice Nuku driven from pillar to post in a desperate or not at the time of their demolition. It said after the city obtained the eviction quest for a place where they and their referred the case back to the High Court order, it did not ‘deal with the issue of families can rest their heads. Our soci- for evidence to be heard on this. The alternative accommodation’ or hold a ety as a whole is demeaned when state Fischer case centres on the question of meeting with the residents. The other action intensifies, rather than mitigates, whether the factual requirements for the factor that weighed heavily with Nuku their marginalisation’ (Port Elizabeth Mu- mandament van spolie were met. But it AJ is the city’s attitude that it is not nicipality v Various Occupiers 2005 (1) also raises the question of what consti- obligated to provide alternative accom- SA 217 (CC)). tutes a ‘home’. The purpose of s 26(3) modation to the occupants. According to and the PIE Act is primarily to protect Nuku AJ, in instances where the person people’s homes. is to be evicted from land owned by an organ of state, the protection afforded in Suspension of eviction the PIE Act must be available even if the order relating to Newcastle person occupied the land for less than Madeleine Truter BLC LLM (UP) BA six months. Nuku AJ also highlighted (Hons) Political Science (UP) Advanced informal settlement the residents’ poor living conditions and Certificate in Company Law (Wits) Ad- On 14 December 2015, the Western Cape urged the city to resolve the matter as vanced certificate law of banking and High Division of the Court (City of Cape soon as possible. financial markets (cum laude) (Wits) is Town v Those Persons Occupying and/ Ndifuna Ukwazi (NU), an activist or- a legal adviser at The Pivotal Fund Ltd or intending or attempting to occupy or ganisation and law centre that promotes in Johannesburg. erect structures on erf 18370, Khayelitsha the realisation of constitutional rights q

DE REBUS – SEPTEMBER 2016 - 31 - Picture source: Gallo Images/iStock

By Johan van der Merwe

On the relativity of property rights in the Constitution

he very first founding provi- adapted from time to time to give clear- South African courts is to develop a sub- sion of the Constitution de- er expression to those values which the stantive account of the values and pur- clares that the Republic is a Constitution entrench, namely, human poses which the socio-economic rights state founded on values. Our dignity; human rights and freedoms; and protect …’ (S Liebenberg Socio-Economic social order is in the first social justice. The Constitutional Court Rights (Cape Town: Juta 2010) at 42). Tplace a value based society, and not rule (CC) plays a decisive role in this process This article aims to consider briefly, based. The importance of this point of of the continuous adaption of rules to and in very broad strokes, how the con- departure can hardly be underestimated, better express, protect and promote our cept of property rights in a democratic because it means that the rules must be constitutional values: ‘The challenge for constitution differs from the pre-consti-

DE REBUS – SEPTEMBER 2016 - 32 - FEATURE – CONSTITUTIONAL LAW

sion was lost, the ability to trump com- the rights and interests of non-property peting use rights of others, and the strin- rights holders. ‘The Constitutional Court gent requirements, and extraordinary has held on a number of occasions that long time periods, to achieve acquisi- the core constitutional values of hu- tive prescription. This notion of prop- man dignity, equality and freedom are erty rights is the product of a particular implicated in circumstances of material world order and could be described as deprivation’ (Liebenberg (op cit) at 100). the liberal perception of rights. Property rights cannot be exercised in However, this perception of rights is isolation, but only in the public arena. no longer acceptable in a constitutional The public interest in private property dispensation: ‘The idea behind this lib- rights refers to the social dimension eral perception of rights is that property of ownership, which ‘requires a private rights are natural rights that predate owner to take into account the effects of social or state organisation and that the exercises of ownership on society as they are therefore absolute or inclusive a whole. … The pendulum has swung in of all conceivable entitlements in their the direction of communisation of own- “normal” form; restriction comes later ership since the twentieth century: “land through state intervention that follows ownership entails communityship”’ (Sa- the social contract. Accordingly, restric- gaert (op cit) at 95) (my italics). tions that limit the pre-existing right re- This mantra, ‘land ownership entails quire special authorisation and, in suit- communityship’ captures the essential able cases, compensation. However, the values, which underlie and inform the classic liberal notion of property rights concept of private property rights in is outdated. Most theorists now accept the Constitution. The public interest in that property, like any other economic property rights affect a large number of right, is a social construct that depends people and directly impact on the mate- on social, political and legal rules for its rial quantity and spiritual quality of their existence, its nature and its scope’ (AJ Van lives, and these must be weighed against der Walt Constitutional Property Law 3ed the private individual interest of an indi- (Cape Town: Juta 2011) at 172) (my ital- vidual who, at common law, was entitled ics). to yield the mere absence of consent, In Europe, this development is referred and nothing else, to undermine and frus- to as the ‘social dimension of ownership’ trate the aims of social justice. (V Sagaert ‘The Gradual Erosion of the It follows that ‘… existing and new Distinction between Deprivation and property interests are recognised and Regulation of Ownership’ in S Scott & J protected when and in so far as it is Van Wyk (eds) Property Law Under Scru- necessary to establish and uphold an tiny (Cape Town: Juta 2015) at 94). equitable balance between individual property interests and the public inter- The values that underlie est, with due regard for the historical property rights context within which property holdings were established and the constitutional Property rights have a profound enabling context within which they are protected’ and facilitating effect on human dignity, (Van der Walt (op cit) at 189). personal security, and security of tenure, In the premises the very same values and these values are evidently a matter that promote the public interest and so- of public interest. Property rights have cial justice, namely dignity, equality and a direct and fundamental impact on the freedom, also underlie the concept of tutional dispensation, what the values landless and poor masses, as well as on private property rights. are that underlie the rules of constitu- the wealthy elite of landowners. Thus tional property rights, particularly vis-à- these rights do shape society, and have vis use rights, the impact on social and the potential to benefit innumerable Environmental justice environmental justice, and how the CC is occupiers, and could enhance and ma- The constitutionally sanctioned values giving effect to these changes. terially increase the quality of life espe- of property rights outlined above also cially of large numbers of rural dwellers. offer a rational basis to facilitate, and Property rights before and ‘Judging from European Convention case give effect to, the environmental impera- after the Constitution law and recent South African case law, tives in the Constitution. The right of ownership at common law the courts might bend over backwards to When approached with a communal was the most extensive right in respect protect socially or economically insecure sense of ownership, it becomes possible of property. It was an independent real land-use rights, particularly residential to provide for the protection of the envi- right and it was broad, almost unlimited rights that affect the human dignity ronment in a holistic fashion. The rules, and absolute in ambit (see for instance and personal security of people’ (Van which would ensure that the environ- CG van der Merwe Sakereg 2 ed (Durban: der Walt (op cit) at 187). There can be ment is protected for future generations, LexisNexis 1989) at 175ff). A duly regis- no doubt that the increased security of will often impact on the sphere of pri- tered property right granted an almost tenure, and of pride of possession, shall vate property rights and interfere with free reign to the owner to do as he or she establish and elevate the perceived and the domain of the landowner. In a pre- deems fit with his or her property. The experienced dignity of persons who are constitutional dispensation such regula- extent of this right is evident from, inter not landowners. tion was largely subject to the whims of alia, the ability to reclaim possession of Property rights can no longer be the individual landowner. This, however, one’s property regardless of how posses- viewed in isolation, and are relative to is changing.

DE REBUS – SEPTEMBER 2016 - 33 - FEATURE – CONSTITUTIONAL LAW

Not surprisingly, theoretical frame- The other building blocks for the proper Act 62 of 1997 (ESTA) brought s 26(3) works have been developed to allow conceptualisation of property and the to the fore and the CC had occasion to for the shift in the concept of property function that its protection will serve pronounce on the concept of property in rights with a view to accommodating have already been laid in FNB: the context of how s 25 property rights environmental justice. In this regard, (i) the protection of property as an in- should be limited. The court, referring see for instance ‘Re-examining the Own- dividual right is not absolute but subject to the common-law claim for eviction, ership Paradigm: Rights of Ownership to societal considerations; decided ‘… that common-law claim is or Rights of Use? The Need for a New (ii) that property should also serve the now subject to the provisions of ESTA. Conceptual Basis for Land Use Policy’ public good is an idea by no means for- The provisions of ss 8, 9, 10 and 11 of (ET Freyfogle, MC Blumm and B Hudson eign to pre-constitutional property con- ESTA have the result that the common- Natural Resources Law: Private Rights cepts; and law action based merely on ownership and the Public Interest (West Publishing (iii) neither the subjective interest of and possession, as in Graham v Ridley Company 2015) and ‘The Public Trust the owner in the thing owned, nor the [1931 TPD 476], is no longer applicable’ Doctrine as a Background Principle of economic value of the right of owner- (para 37). Property Law’ (MC Blumm and MC Wood ship, can determine the characterisation In Molusi the CC also referred to how The Public Trust Doctrine in Environmen- of the right. the balancing of the rights of the owner tal and Natural Resources Law 2ed (Caro- … and that of the occupier must be done lina: Academic Press 2016). The objective normative values of in order to infuse justice and equity into the Constitution thus require us to de- the inquiry, and referred to Hattingh Constitutional Court termine what kind of property deserves and Others v Juta 2013 (3) SA 275 (CC), The CC had occasion from time to time protection under the property clause, by where the court held: ‘[T]he part of s 6(2) to give account of the changing rules of reference to the Constitution itself. The [of ESTA] that says: “balanced with the property rights. fundamental values of dignity, equality rights of the owner or person in charge” In First National Bank of SA Ltd t/a and freedom necessitate a conception of calls for the striking of a balance be- Wesbank v Commissioner, South African property that allows, on the one hand, tween the rights of the occupier, on the Revenue Service and Another; First Na- for individual self-fulfilment in the hold- one side, and those of the owner of the tional Bank of SA Ltd t/a Wesbank v Min- ing of property, and, on the other, the land, on the other. This part enjoins that ister of Finance 2002 (4) SA 768 (CC) the recognition that the holding of property a just and equitable balance be struck CC found that: ‘The purpose of s 25 has also carries with it a social obligation not between the rights of the occupier and to be seen both as protecting existing to harm the public good. The function those of the owner. The effect of this is private property rights as well as serving that the protection of holding property to infuse justice and equity into the in- the public interest, mainly in the sphere must thus, broadly, serve is the attain- quiry required by s 6(2)(d)’ (para 32). of land reform but not limited thereto, ment of this socially-situated individual and also as striking a proportionate bal- self-fulfilment. The function of personal Conclusion ance between these two functions’ (para self-fulfilment in this sense is not pri- Property rights, in the context of either 50). marily to advance economic wealth max- s 25 or s 26 of the Constitution are no Invariably, the references to Shoprite imisation or the satisfaction of individu- longer absolute. Molusi was the final nail Checkers (Pty) Ltd v MEC for Economic al preferences, but to secure living a life in the coffin of absolute private property Development Eastern Cape and Others of dignity in recognition of the dignity of rights at common law, and the balancing 2015 (6) SA 125 (CC) in the majority judg- others. And where the holding of prop- exercise described in the Hattingh and in ment of Froneman J should be extensive, erty is related to the exercise, protection Molusi cases confirmed the relativity of as the CC decided: ‘… to determine what or advancement of particular individual constitutional property rights, and paves kind of property deserves protection rights under the Bill of Rights, the level the way for interpreting, and balancing, under the property clause cannot be re- of the protection afforded to that hold- property rights in future. stricted to private-law notions of prop- ing will be stronger than where no rela- erty. To do so would exclude other po- tion of that kind exists’ (paras 43 to 50) tential constitutional entitlements that (my italics). may deserve protection from the ambit The FNB and Shoprite cases dealt with Johan van der Merwe BCom BA of protection under the property clause. the concept of property in the context (Hons) LLB (Stell) LLM (University of … In all of this, the fundamental values of what constitutes property. In Molusi Kiel) (Germany) is an attorney at JD of dignity, equality and freedom play a and Others v Voges NO and Others 2016 van der Merwe Attorneys in Stellen- central role. Our conception of property (3) SA 370 (CC) an eviction application in bosch. must be derived from the Constitution. … terms of Extension of Security of Tenure 

What we do for ourselves dies with us. What we do for others and the world remains and is immortal - Albert Pine www.salvationarmy.org.za

DE REBUS – SEPTEMBER 2016 - 34 - LAW REPORTS THE LAW REPORTS

July 2016 (4) South African Law Reports (pp 1 – 314); [2016] 2 All South African Law Reports June (pp 633 – 932); [2016] 1 All South African Law Reports February (pp 313 – 627); 2016 (6) Butterworths Constitutional Law Reports June (pp 709 – 838)

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 Re- ports. Readers should note that some reported judgments may have been overruled or Heinrich Schulze BLC LLB overturned on appeal or have an appeal pending against them: Readers should not rely (UP) LLD (Unisa) is a professor of law at Unisa. on a judgment discussed here without checking on that possibility – Editor.

Abbreviations ing that they call them back. fide negotiations over com- The majority (per Jafta J; Vodacom launched the ser- pensation. Vodacom disput- Mogoeng CJ, Moseneke DCJ, CC: Constitutional Court vice in February 2001. It was ed the existence of any such Khampepe J, Matojane AJ, ECG: Eastern Cape Division, a major success, netting Vo- agreement and contended in Nkabinde J and Zondo J) held Grahamstown dacom several billion rands. the alternative that Geissler that interference with the ECP: Eastern Cape Local Divi- Makate’s role in conceiving lacked actual or ostensible factual findings of the High sion, Port Elizabeth the idea was acknowledged (apparent) authority to bind Court was not warranted. GJ: Gauteng Local Division, shortly thereafter in Voda- the company. Instead, the majority held Johannesburg com’s internal newsletter. The High Court held that that the matter had to be ap- SCA: Supreme Court of Appeal Geissler, Vodacom’s then Makate had proved the com- proached on the basis that an WCC: Western Cape Division, director of product devel- pensation agreement between agreement between Makate Cape Town opment, verbally agreed to him and Vodacom and that and Geissler was established. remunerate Makate for his Knott-Craig did not invent The majority rejected the Agency idea. The parties deferred ne- ‘Please Call Me’. However, it High Court’s faulty conflation Ostensible authority: The de- gotiations on the amount of dismissed Makate’s claim on of estoppel and ostensible au- cision in Makate v Vodacom compensation to a later date. the ground that Geissler had thority, which were distinct Ltd 2016 (4) SA 121 (CC); 2016 They further agreed that if lacked ostensible authority concepts. This conflation had (6) BCLR 709 (CC), enjoyed a no agreement was reached, and also because the claim resulted in the attribution of fair amount of media atten- compensation would be de- had prescribed under s 11(d) elements of estoppel to os- tion. The court considered termined by Vodacom’s Chief of the Prescription Act 68 of tensible authority. However, a number of legal concepts, Executive Officer (CEO). No 1969 (the Prescription Act). It estoppel was not a form of including agency, ostensible agreement on compensation held that the word ‘debt’ had authority, but a rule that if the authority and estoppel. was, however, reached, and to be widely interpreted to in- principal had conducted him- The crisp facts were as fol- later the then CEO of Vo- clude a claim that the defend- self in a manner that misled a lows: During 2000 the appel- dacom, Knott-Craig, falsely ant (here: Vodacom) comply third party into believing that lant, Makate, was employed claimed that ‘Please Call Me’ with its obligations under the agent had authority, he as a trainee accountant by the was his idea. Having received a contract. Invoking the es- was precluded from denying respondent, Vodacom. Dur- no compensation for his idea toppel-as-shield analogy, the it. It held that ostensible au- ing his employment with Vo- at all, Makate left Vodacom court found, moreover, that thority required the element dacom, and because his girl- late in 2003. In 2008, some Makate should have pleaded of representation, but lacked friend at the time could not four years after the launch of ostensible authority in repli- the other elements of estop- afford airtime to phone him, the ‘Please Call Me’ product, cation instead of raising it in pel. Ostensible authority was Makate conceived the idea of he instituted a High Court ac- his particulars of claim. the authority of an agent as it Vodacom’s lucrative ‘Please tion to enforce his agreement Mokate applied for leave to appeared to others while es- Call Me’ service. It allowed with Geissler, which, accord- appeal to the CC. toppel was no authority at all. Vodacom’s prepaid users to ing to the undisputed evi- In deciding the matter, the Since Makate alleged in his send a free text message to dence of Makate, was that the CC handed down both a ma- particulars that Geissler had other Vodacom users request- parties would enter into bona jority and a minority decision. ostensible authority and Vo-

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DE REBUS – SEPTEMBER 2016 - 35 - dacom denied this in its plea, tiations in good faith with The what, how and ostensible authority became Makate within 30 days for one of the issues to be deter- determining reasonable com- mined at trial. pensation payable to him in when of Mediation The majority found that terms of the agreement. Vo- Two hour seminar do not miss out! Geissler had indeed had os- dacom was further ordered to tensible authority to bind pay the costs of the present Vodacom. It reasoned that action. Geissler was Vodacom’s di- Suffice it mention here that rector of product develop- the minority (per Wallis AJ, ment and thus in charge when Cameron, Madlanga and Van dealing with third parties in der Westhuizen JJ) agreed relation to new products. He that Makate was entitled to was further a member of Vo- the relief stipulated by the dacom’s board, he had power majority. However, the mi- over new products, and the nority reasoned that it was role that he played within Vo- settled law that, where there dacom’s organisational struc- was no actual authority, os- ture, gave the appearance tensible authority was a form Offered by LEAD in cooperation with Conflict Dynamics that Geissler had authority to of estoppel. and its panel of mediators negotiate all issues relating to Mediation is becoming a desired method for resolving the introduction of new prod- Civil procedure disputes in most areas of the law and practice. ucts at Vodacom. The majority further reject- Citation of trust: In Pro-Kha- It changes the way in which we practice and think about ed the reasoning in the High ya Construction CC v Trustees reaching best solutions for our clients. Therefore, every Court that Makate’s claim had for the time being of the Inde- attorney should acquire the competency to mediate, for prescribed. In this regard it pendent Development Trust professional and business reasons. held that the term ‘debt’ as [2016] 2 All SA 909 (ECP) the used in the Prescription Act applicant, Pro-Khaya, sought The purpose of this seminar is to highlight the meaning, relevance and key elements of mediation. It will show had to be narrowly interpret- to have an arbitration award why attorneys are best placed to practise mediation. ed so that it least impaired made an order of court, in the right of access to courts. terms of s 31(1) of the Arbi- ABOUT THIS SEMINAR: • The lawyer’s role in mediation. But since Makate’s claim for tration Act 42 of 1965 (the Modern legal practice across the • How best to prepare for medi- an order forcing Vodacom fell Act), as well as an order for world includes the capacity to ation? beyond the scope of a ‘debt’ payment by the respondent, advise clients of the full range of • How to encourage your clients as defined by ruling prec- dispute resolution options avail- to use mediation? the Trust, of the various sums able, and to participate actively edent, namely an obligation of money awarded to Pro- in mediation. Mediation is now PRESENTERS: to either pay money, deliver Khaya by the arbitrator. not uncommon in contracts, and Presenters will be experienced goods or render services, it The arbitration arose in the magistrate’s court and lawyers who have also been was not necessary to precise- from an agreement between High Court procedures in South trained and accredited as me- ly determine its meaning. The Pro-Khaya and the Trust in Africa. This seminar will equip diators by Conflict Dynamics. trial court had attached an in- terms of which, the former lawyers with a comprehensive correct meaning to the word. was to construct a multi- understanding of mediation. WHO SHOULD ATTEND? Because a ‘debt’ contemplat- storey classroom develop- Lawyers will also learn about the Attorneys, advocates and ad- ed in s 10 of the Prescription benefits of mediation for their ministrators who have a role in ment and certain other build- legal practice, their role in me- advising clients will benefit by Act did not cover the present ings in Uitenhage, in return diation and how to prepare for the seminar. claim, it did not prescribe. for payment by the Trust of mediation in order to achieve Makate sought the enforce- R 27 586 305,69. the best results for their clients. WHERE AND WHEN? ment of a pactum de contra- The Trust raised a number • Port Elizabeth: 31 October. hendo, that is, an agreement of objections to Pro-Khaya’s SEMINAR CONTENT: • Johannesburg: 26 October. to agree, on fair compensa- application. I will refer to • What is mediation? • Pretoria: 27 October. tion for his idea. Such pacta only some of them here. The • Stages in the mediation pro- • East London: 7 November. were enforceable if they pro- first of these objections was cess. • Durban: 14 November. vided a deadlock-breaking • The principles of mediation. • Bloemfontein: 25 November. that the Trust was cited as • How does mediation compare • Cape Town: 21 November. mechanism, should the par- ‘The Trustees for the time be- with other dispute resolution ties fail to reach consensus. ing of the Independent Prop- processes? COST OF THE SEMINAR: Here a deadlock-breaking erty Trust’. The Trust took • What are the advantages of R250 mechanism was in place: If the point that all the trustees mediation? the parties disagreed on com- were not individually cited • How might mediation benefit TIME: pensation, it would be deter- and that the Trust was not your practice? 11:00 – 13:00 mined by Vodacom’s CEO. properly before the court. The majority confirmed Roberson J held that the For more info contact our Seminar that the CEO could not rep- notice of motion in the coun- Department at (012) 441 4600 or e-mail: resent Vodacom at the ne- ter-application cited all 11 [email protected] gotiations, but could only be trustees by name. In those approached to break dead- circumstances, the objec- lock. It accordingly held that tion was highly technical and Vodacom was bound by the could not be upheld. Effec- agreement between Makate tively, all the trustees were and Geissler. Vodacom was before the court in their ca- ordered to commence nego- pacities as trustees and there

DE REBUS – SEPTEMBER 2016 - 36 - LAW REPORTS was no real failure to cite all vested in a company in which tions fell squarely within the ing with the mother. At a pre- the trustees. Gihwala’s wife had an inter- grounds for a delinquency trial hearing on 6 November A further objection was est, but this company was order as described in s 162(5) 2015 the court directed the that there was no agreement liquidated and the money (c) of the Companies Act 71 mother in terms of r 37(8)(c) to refer the disputes to arbi- was lost. Ngatana also paid of 2008 because they grossly to facilitate a meeting with a tration. The court rejected R 750 000 each to Gihwala abused their position as direc- representative of the family that submission. It held that and Manala as ‘directors’ fees’ tors and intentionally or, at advocate’s office in order to the Trust’s inactivity could because of SMI’s assistance in the very least, through gross allow the latter to complete not avail it in the circum- setting up the original BEE negligence, caused harm to an assessment of the son in stances. scheme. SMI also made two SMI. his domestic environment. It was concluded that the loans to Manala without the The court further held that The mother failed to adhere Trust had failed to estab- knowledge of Grancy. s 162(5) was not a penal pro- to the direction. lish any grounds for the set- Ngatana eventually sold all vision but intended to protect The mother was ordered ting aside of the arbitration its shares in Redefine and SMI the investing public against to appear before the present award. The award was accord- received a dividend of R 5 572 directors who engage in se- court to answer to charges of ingly made an order of court. 727. This amount was paid rious misconduct and act in contempt of court for her fail- in equal shares to the Trust breach of the trust that share- ure to answer to the direction Company law and Manala. The relationship holders place in them. This is given by the court. between Mawji and Gihwala not an arbitrary or capricious In the contempt of court Delinquent directors: In Gi- became acrimonious and sev- provision limiting their right charge the mother was rep- hwala and Others v Grancy eral High Court actions fol- to choose a profession but is resented by an advocate who Property Ltd and Others lowed. (See also law report in the public interest. appeared amicus curiae. [2016] 2 All SA 649 (SCA) the ‘Companies’ for Grancy Prop- The appeal was dismissed It was argued on behalf of court confirmed that a delin- erty Ltd v Manala and Others and Gihwala, Manala and the the mother that a direction in quency order against delin- 2015 (3) SA 313 (SCA); [2013] Trust were declared liable, terms of r 37(8)(c) is not an quent directors of a company 3 All SA 111 (SCA) (2015 jointly and severally to Gran- order of court and that con- is not unconstitutional. (Aug) DR 46).) cy. tempt proceedings were ac- The crisp facts in the Gih- A number of issues arose cordingly not appropriate. wala case were as follows: In for determination on appeal. Contempt of court Gamble J held that, pro- 2005 an overseas investor, For space considerations I vided the mother has acted Mawji, accepted an invitation will restrict my discussion Failure to follow direction: At with wilfulness or mala fides, from Gihwala to invest in a to only two of these issues, stake in MT v CT 2016 (4) SA her failure to adhere to the joint venture with the Dines namely: 193 (WCC) was the question direction given on 6 Novem- Gihwala Family Trust and • Whether the 2005 agree- whether a plaintiff, the moth- ber 2015 is indeed capable of Manala, using Seena Marena ment was breached and, if so, er, who appeared for herself being addressed through con- Investments (Pty) Ltd (SMI) in what respects? in a divorce matter, was guilty tempt proceedings. (of which Gihwala and Manala • Whether the High Court was of contempt of court where The mother’s assumptions were the directors and share- correct to make orders of de- the presiding judge gave the of bias on the part of the rep- holders) as the front com- linquency in relation to Gih- mother directions in terms of resentative of the office of the pany. wala and Manala. Uniform Rule 37(8)(c), but she family advocate were mani- In terms of this 2005 agree- Wallis JA held that the 2005 failed to adhere to. festly unreasonable in the ment, Grancy Property Ltd, agreement contained various The principle issue in the context of clear directions to Grancy, a company controlled tacit terms, inter alia, that divorce action was the care participate in the obligatory by Mawji, acquired one-third Grancy was to become hold- and contact arrangements in investigation being conduct- of the shares in SMI. Grancy er of one-third of the shares relations to the parties’ minor ed by the family advocate. also made a loan to Manala in SMI. Although it was not son (the son). The son was liv- The court accordingly held to pay half of the amount he a partnership agreement, it needed for his one-third con- was similar to one in many tribution to SMI. SMI used the respects. Gihwala and Manala funds provided by the three stood in a fiduciary relation- investors (Grancy, Manala ship to Grancy to protect its and the Trust) to acquire a interest as a shareholder. 58% shareholding in Ngatana There were clear breaches Property Investments (Pty) of the agreement, inter alia, Ltd (Ngatana), the company by Gihwala and Manala refus- registered for purposes of a ing to acknowledge Grancy as BEE scheme enabling black a shareholder; and by refus- investors to obtain shares ing the latter to exercise cer- in a listed company – Spear- tain rights of a shareholder. head Property Holdings Ltd Finally, the court upheld – at a reduced price. Eventu- the orders of delinquency ally these were exchanged for in relation to Gihwala and shares in Redefine Income Manala. It held that they had Fund Ltd after a takeover by acted with gross negligence the latter. and in breach of their fidu- After a payment was made ciary duties to SMI by ap- by Ngatana to SMI of R 6 657 propriating benefits received 673, a total of R 4 million was from Ngatana for themselves paid to the Trust, Gihwala while it should have gone to and Manala but nothing to the company and then to its Grancy. R 2 million was in- three shareholders. Their ac-

DE REBUS – SEPTEMBER 2016 - 37 - that the mother acted in con- default judgment obtained forthwith with the execu- consumer to be able to rein- tempt of court. It decided to against her by the bank, to- tion sale. The settlement was state a credit agreement, the afford an opportunity to the gether with an application for never made an order of court. debtor did not need to pay parties to address the court the cancellation of the sale in Although Nkata paid all of the the full accelerated debt, but afresh on the aspect of an execution of her immovable arrears on the account, she only the arrear instalments appropriate sanction, before property. did not make any payments and the costs. It also held that handing down such action. The High Court refused towards the agreed default since the property had been The matter was accordingly rescission, but at its own in- administration costs or the sold in execution, the agree- postponed to a later fixed stance reinstated the cred- reasonable costs in enforcing ment could not be reinstated. date. it agreement in terms of the agreement that the bank Nkata appealed to the CC s 129(3)(a) of the NCA. This had incurred. The bank at no where the Cameron J, for the Credit law section allows reinstatement stage made a separate claim majority held that the main if a consumer pays all over- for these costs, but simply objective of the NCA is the Reinstatement of credit due amounts, including the added them to the outstand- protection of consumers. This agreement: In Nkata v Fir- default administration costs ing amount on her bond ac- protection, however, must be stRand Bank Ltd 2016 (4) SA and reasonable enforcement count. When Nkata again fell balanced against the interests 257 (CC); 2016 (6) BCLR 794 costs. This right may, howev- into arrears, the bank caused of credit providers. The court (CC), the CC brought clarity er, only be exercised before – the property to be sold in ex- emphasised that the NCA was on the vexed question wheth- • the creditor cancels the ecution. a clean break from the past er debtors can reinstate a agreement; and The High Court held that a and encourages dialogue be- credit agreement in terms of • where, the property has judgment was only actually tween consumers and credit s 129(3) of the National Credit been sold in execution or the executed when money was providers. Act 34 of 2005 (the NCA). execution of any other court raised pursuant to a sale of It is trite that subss 129(3) The facts were that a con- order enforcing that agree- attached property and paid and (4) introduced a novel sumer, Nkata, who was in ment, as provided for in sub- to the judgment creditor. Ac- relief of reinstatement. A default of a mortgage loan ss 129(3) and (4). cordingly, s 129(4) was no consumer is entitled to rein- agreement, paid all over- The application for rescis- bar to the reinstatement of state the agreement if it has due instalments, but did not sion was preceded by a pre- the agreement in terms of not been cancelled and is also make separate payment of vious application for rescis- s 129(3). It also held that on entitled to return of the at- the ‘costs of enforcing the sion. That application was the facts the agreement had tached property. Cancellation agreement’, which the credit settled by the parties on con- been reinstated and it accord- can only take place after the provider FirstRand Bank (the dition that Nkata would pay ingly cancelled the execution credit provider has initiated bank) had debited to her ac- all arrears and, in the event sale. enforcement proceedings by count. She brought an appli- of failure to do so, the bank The bank appealed to the issuing a s 129 notice. Sec- cation for the rescission of a would be entitled to proceed SCA. The SCA held that for a tion 129(3) requires only the

DE REBUS – SEPTEMBER 2016 - 38 - LAW REPORTS arrear instalments to be paid, tion for All and Others 2016 am, successfully applied for directing Readam to itemise and not the full accelerated (4) SA 63 (SCA); [2016] 1 All an order in the court a quo di- all documents and other in- amount of the debt as the lat- SA 369 (SCA), the court was recting that a building owned formation, which Readam ter approach would make the asked to consider the param- and constructed by the ap- contended were missing from remedy meaningless. eters of the constitutional pellant, BSB, in Parkmore, the record filed by the mu- Section 129(3) requires right to education. The sali- Sandton be demolished to the nicipality. Finally, an order the consumer to pay all the ent facts were that the De- extent necessary to ensure was also sought staying the amounts that are overdue partment of Basic Education compliance with the applica- review proceedings pending plus the permitted default (the department) adopted a ble town planning scheme. the municipality’s furnishing charges and reasonable costs new curriculum for schools. The primary relief sought by of the missing portions of the of enforcing the agreement. The new curriculum included Readam in terms of r 53 of record. The counter-applica- The legal costs, however, only new textbooks. However, the the Uniform Rules of Court, tion was dismissed, and on becomes due and payable department failed to provide was directed at reviewing appeal, BSB sought leave to when they are reasonable, textbooks to certain public and setting aside the building appeal primarily on the basis and agreed or taxed, and on schools in Limpopo. The re- plans approved by the munic- that the court a quo had erred due notice to the consumer. spondent, Basic Education for ipality in terms of s 7 of the in dismissing its counter- Reinstatement takes place All (BEFA), was a voluntary National Building Regulations application, asserting that by operation of law when the association based in Limpopo and Building Standards Act it had been denied a proper consumer has made the nec- and was formed in response 103 of 1977 (the Act). Despite opportunity to be heard and essary payments. There is no to the education crisis in Lim- that, the second respondent – defend itself against the chal- requirement that the rein- popo. the Johannesburg Metro Mu- lenges made by Readam. statement needs to be com- BEFA obtained a High Court nicipality (the municipality) – BSB also submitted that municated to the credit pro- order declaring the constitu- filed no answering affidavit there was a dispute of fact on vider to be effective. tional rights of the affected and took no part in the pro- the papers as to whether the In the present case the children. The court ordered ceedings. requirements of the scheme bank never demanded pay- the department to deliver the In response to Readam’s had been contravened with ment of the costs. It simply books. The department ap- application, BSB launched a regard to the permissible cov- added them to the bond ac- pealed to the SCA. counter-application founded erage of the building on the count without any notice to Navsa JA held that the issue on the complaint that it was site, and the provision of ad- the consumer. The costs were at stake here was whether the prejudiced in its defence of equate parking. never agreed or taxed and constitutional right to a ba- the main application, by the On appeal to the SCA Pon- had therefore never become sic education as enshrined in inadequate record furnished nan and Swain JJA in a joint due. The court held that the s 29(1)(a) of the Constitution by the municipality. It also judgment decided that BSB’s bank should have demanded included a right of each learn- sought orders against Re- submissions were without payment of the reasonable er to be given the textbook adam and the municipality merit. It held that it was clear costs of enforcing the agree- prescribed for each subject ment separately from Nkata’s before the start of teaching of arrears, and brought them to that subject. Although s 29(1) her attention. (a) does not spell out the de- The appeal was accordingly tails of the right to basic edu- allowed and the court held cation, the centrality of text- that the agreement was val- books in the realisation of the idly reinstated and the execu- right to a basic education is tion sale rescinded. It ordered uncontested. Clearly learners the bank to pay Nkata’s costs who do not have textbooks in the High Court, the SCA are adversely affected. The and the present court. failure to provide textbooks • See case note ‘NCA: The line to learners in the present cir- in the sand – can a cancelled cumstances was a violation agreement be revived?’ 2016 of the rights to a basic educa- (May) DR 41. tion, equality, dignity and of • See letter ‘Drawing the line s 195 of the Constitution. in the sand’ 2016 (June) DR 6. The appeal was dismissed • See practice note ‘Protection with costs and the depart- offered by s 129 of the Na- ment was ordered to provide tional Credit Act’ 2016 (July) every learner with every text- DR 23. book prescribed for his or her • See feature article ‘Nkata: grade before commencement The court’s interpretation of the teaching of the course of s 129 of the NCA and the for which the textbook is pre- meaning of “reinstatement”’ scribed. 2016 (July) DR 28. • See case note ‘Banks beware: Nuisance Reinstatement of mortgage loan agreements’ 2016 (July) Neighbour disputes: The DR 52. facts in BSB International Link CC v Readam South Africa Education (Pty) Ltd and Another 2016 Provision of textbooks: In (4) SA 83 (SCA); [2016] 2 All Minister of Basic Education SA 633 (SCA) were as follows: and Others v Basic Educa- The first respondent, Read-

DE REBUS – SEPTEMBER 2016 - 39 - LAW REPORTS that BSB’s construction had ers 2016 (4) SA 303 (SCA) the prohibition’ in South African that a failure to cancel a con- infringed on the relevant facts were as follows: Grainco law was confirmed in A Beck- tract within a reasonable time zoning provisions in respect Investments (old Grainco) er & Co (Pty) Ltd v Becker and after the breach may provide of coverage and parking. A sold its business assets, in- Others 1981 (3) SA 406 (A), evidence of an election to court hearing an application cluding its goodwill, as a go- namely if a seller disposed of abide by the contract applies in terms of s 21 of the Act, ing concern to BKB Ltd. Old the goodwill of a business he in our law. In this regard the has no latitude not to order Grainco was subsequently or she was not allowed there- court referred with approval the complete demolition of liquidated. Although the after to act contrary to the to the decision in Paradysk- a building once the jurisdic- contract refered to certain sale. In that case, Becker en- loof Golf Estate (Pty) Ltd v Mu- tional fact, namely that the shareholders, that is, Them- tered the agreement as direc- nicipality of Stellenbosch 2011 building was erected contrary beka Capital and two family tor, but also in his personal (2) SA 525 (SCA); [2010] 4 All to the Act, was established. trusts, they were not cited as capacity. SA 591 (SCA). Only a local authority or the parties to the agreement. Old In this case, neither Van Moreover, the Sheriff had minister has locus standi to Grainco was represented by der Merwe nor Kitshoff, was not fulfilled his own obliga- bring an application in terms Van der Merwe and Kitshoff, a seller and the implied term tions in terms of the agree- of s 21 before a magistrate. who were instrumental in the can accordingly not be en- ment. In this regard the court The statutory right to seek success of old Grainco. forced against them. They relied on the long stand- the remedies provided for The sales agreement in- were also no longer bound by ing principle that where a in s 21 is clearly intended to cluded a five-year restraint the restraint of trade under defence is raised against a enable local authorities and of trade on Van der Merwe the original contract of sale. party, it is incumbent on the the minister, to ensure com- and Kitshoff. BKB then sold The appeal was dismissed applicants to prove that they pliance with the provisions the business assets to a new with costs. have complied with their obli- of the Act in relation to town company, which was renamed gation (BK Tooling (Edms) Bpk planning schemes. Conse- Grainco. Grainco employed Sale in execution: In Sheriff v Scope Precision Engineering quently, an individual with both Van der Merwe and Kit- of Johannesburg North and (Edms) Bpk 1979 (1) SA 391 standing to bring an applica- shoff during the five-year Another v Yellow Dot Property (A)). Applied to the present tion to review and set aside period that their restraint of Investments and Another; In facts the court held that the the unlawful approval of trade was valid. re: Absa Bank v Van den Berg first applicant was obliged building plans by a local au- On the lapsing of the re- [2016] 2 All SA 927 (GJ) the to demonstrate compliance. thority would not have locus straint of trade, both Van der applicants sought the cancel- It failed to do so. The series standi to pursue the remedies Merwe and Kitshoff resigned lation of a sale in execution of of errors relative to the exact provided for in s 21. and formed a new company, a property in the Johannes- amount payable by the re- However, Readam was not Perdigon, which started trad- burg suburb of Westdene as spondents in respect of the without a remedy. In the case ing across the street from a result of an alleged breach rates left the applicants’ case of encroaching structures, the Grainco. A number of other of conditions of sale by the dissatisfactory. owner of the land which is en- staff members also resigned respondents. The sale was The application was ac- croached on can approach the from Grainco and joined Per- concluded following an at- cordingly dismissed with no court for an order compelling digon. Perdigon, as a direct tachment in satisfaction of order as to costs. his or her neighbour to re- competitor of Grainco, imme- a debt due to the second ap- move the encroachment. De- diately started to canvass the plicant. The conditions of Wills spite the above rule the court customers of Grainco. sale required the respondents can, in its discretion, in order Grainco applied for an in- to, inter alia, pay a deposit Execution: In Mlanda v Mhla- to reach an equitable and rea- terdict against Van der Merwe of 10% of the purchase price ba and Others 2016 (4) SA sonable solution, order the and Kitshoff, relying on the and to provide a guarantee 311 (ECG) the testatrix, or a payment of compensation implied term in the sales con- to secure the purchase price person purporting to be the rather than the removal of tract that where goodwill was within a specified time. The testatrix, signed her will by the structure. This discretion sold as part of a going con- first respondent was also re- making a mark. The applicant is usually exercised in cases cern, the seller was not enti- quired to pay all municipal averred that she is the step- where the cost of removal tled to canvass the customers rates required for the issue of daughter of the testatrix and would be disproportionate of the buyers. rates clearance certificate. Al- the sole beneficiary of the in- to the benefit derived from The High Court refused the though the deposit was paid testate estate of the testatrix. the removal. The court a quo interdict because the implied on time, the other obligations Section 2(1)(a)(v) of the Wills failed to appreciate that it term only bound the seller were not met by the respon- Act 7 of 1953 (the Act) re- was possessed of that kind and not any other party. Nei- dents. The late payment of quires in such a situation that of discretion. BSB was warned ther Van der Merwe nor Kit- the amounts relating to those the attending commissioner that it was acting illegally and shoff was a seller in terms of outstanding obligations led of oaths attach a certificate in spite of such warning, it the sale. The contract of sale to the first applicant seeking to the will, in which he or she deliberately persisted with was concluded between BKB the cancellation of the sale. certifies that he or she was its construction. The order and old Grainco. Siwendu AJ held that an satisfied as to the identity of granted by the court a quo Plasket AJA held that the agreement concluded pursu- the testatrix, and that the will which directed that the prop- implied term at stake is of- ant to sale in execution may was indeed her will. Section erty be demolished to the exten referred to as the ‘Trego only be cancelled by a court 2(1)(a)(v) is intended to pre- tent necessary to ensure com- prohibition’, referring to the order on application by the vent an imposter marking the pliance with the scheme was origin of this term in English Sheriff. However, the Sheriff will; or when the mark-maker correct. law in Trego v Hunt [1896] AC in this case overlooked the is genuine but unable to read, The appeal was dismissed 7 (HL). The principle is that first respondent’s various ensuring the document re- with costs. the seller of goodwill is pro- breaches. A failure to cancel flects his or her wishes. Sec- hibited from taking it back by a contract within a reasonable tion 2(1)(a) provides that if Sale canvassing the old business’ time after breach may signify the certificate does not com- Implied term: In Grainco (Pty) customers. an election to abide by the ply with the Act’s require- Ltd v Van der Merwe and Oth- The existence of the ‘Trego contract. The legal principle ments, then the will is invalid.

DE REBUS – SEPTEMBER 2016 - 40 - LAW REPORTS

In the present case the com- was required was that from tory formalities requirements under review also contained missioner wrote in his certifi- the words used it could be was not complied with, the cases dealing with: Adminis- cate that ‘[t]he testator signed inferred without doubt that court found the will to be in- tration of justice, civil proce- in my presence and of the two the commissioner was satis- valid and of no effect. dure, criminal law, customs witnesses’. The question was fied of the facts stipulated in The application was dis- and excise, delict, divorce, whether the certificate com- the Act. From the words used, missed. immigration, lease, local au- plied with the requirements doubt remained as to whether thority, marine insurance, of the Act. the commissioner had satis- Other cases prescription and provincial Pickering J held that use fied himself of the testatrix’s Apart from the cases and top- governments. of the precise words of the identity. ics that were discussed or re- Act was not required. What Because one of the statu- ferred to above, the material q

On a lighter note: Law a practical affair Gillespie v Macmillan 1957 JC 31 at 40 (High Court of Justiciary of Scotland)

ord Justice-Clerk Thomson: ‘If law were an exact sci- But law is a practical affair and has to approach its problems ence or even a department of logic, there might be in a mundane common-sense way. We cannot expect always Lsomething to be said for this argument. By relying on to have a tidy and interrelated picture; in real life a surrealis- the disparate qualities of space and time the logician can tic element is apt to creep in, and the picture, though untidy prove that in a race the hare can never overtake the tortoise. and inharmonious, may be a picture all the same’. q

CASE NOTE – LABOUR LAW

By Lockout of members of trade unions Yashin Bridgemohan not party to a bargaining council

Transport and Allied Workers Union of South Africa v Public Utility Transport Corporation Ltd [2016] 6 BLLR 537 (CC)

ection 64(1)(a) of the Labour ment to be concluded in a council, in council notified the applicant that its Relations Act 66 of 1995 (LRA) which case, notice must have been given central committee would consider the provides: to that council; …’. application for the reinstatement of its ‘(1) Every employee has the membership at a meeting to be held on right to strike and every employ- Facts 17 April 2013. Ser has recourse to lock-out if – In 2002 the applicant, a registered trade On 17 April, industry wage negotia- (a) the issue in dispute has been union and the respondent entered into tions gridlocked at the bargaining coun- referred to a council or to the Com- a recognition agreement in accordance cil and two trade unions gave notice to mission as required by this Act, with the LRA. This agreement continued employers that their members would and – to be in force at all material times be- be embarking on a strike. On 18 April, (i) a certificate stating that the dispute tween the applicant and the respondent. before the strike began the applicant ad- remains unresolved has been issued; or In April 2012 a collective agreement on vised the respondent that its members (ii) a period of 30 days, or any exten- wages and other conditions of employ- would not take part in the strike. The sion of that period agreed to between the ment was concluded between the parties strike subsequently commenced on 19 parties to the dispute, has elapsed since present at the bargaining council. The April. the referral was received by the council applicant a member of the bargaining On even date the respondent forward- or the Commission; …’. council at the time, omitted to sign the ed a notice to the bargaining council, the Section 213 of the LRA defines ‘issue collective agreement. applicant and non-unionised employees, in dispute’ in relation to a strike or lock- The collective agreement continued notifying them that it intended to lockout as ‘the demand, the grievance, or the to apply to the applicant until July 2013 out all of its employees on Sunday, 21 dispute that forms the subject matter of due to the extension by the Minister of April at 9:00 am. the strike or lockout’ (my italics). Labour in accordance with s 32 of the On the same day of receiving the no- Section 64(1)(c) provides: LRA. tice the applicant’s secretary general ‘[I]n the case of a proposed lockout, at In August 2012 the applicant terminat- contacted a senior executive of the re- least 48 hours’ notice of the commence- ed its membership with the bargaining spondent’s corporate services to enquire ment of the lockout, in writing, has been council. However, in February 2013, the whether the lockout applied to its mem- given to any trade union that is a party to applicant attempted to have its member- bers. the dispute, or, if there is no such trade ship reinstated by forwarding a letter to The executive had e-mailed the appli- union, to the employees, unless the issue the bargaining council. cant’s secretary general and provided in dispute relates to a collective agree- On 14 February 2013, the bargaining the notice was a response to the strike

DE REBUS – SEPTEMBER 2016 - 41 - notices issued by the two other trade whether s 64(1) read with s 213 of the gaining council where the dispute arose unions. It was also confirmed that as LRA permits an employer to lockout and was referred for conciliation.’ the applicant was not a member of the members of a trade union – that is not The court held further that the LAC’s bargaining council and not a party to the a party to a bargaining council – where conclusion that the applicant was a party dispute, which caused the lockout and in a particular dispute has arisen and has to the dispute was due to the fact that it the given circumstances the applicant’s been referred for conciliation. had an interest in the dispute was ‘un- member would not be striking. tenable’. This was due to the fact that The bargaining council had also on CC’s judgment the applicant’s interest in the dispute said day sent a letter to the applicant ad- amounted only to ‘a mere hope or expec- vising that its request made in February The court noted the demands in respect tation … ; its interest in the negotiations 2012 was considered and the applicant of wages could only be made at the bar- was confined to a hope that a favourable was now invited to apply for member- gaining council and, therefore, the notice collective agreement would eventually ship in accordance with bargaining coun- sent out by the respondent did not con- be forthcoming’. cil’s constitution. stitute a demand. The applicant’s appeal accordingly

On 23 April 2012 the respondent insti- The court noted further that a lockout succeeded and the court set aside the tuted a lock, which, it provided, applied notice cannot constitute a demand and a order made by the labour appeal court. to all employees including those whom notice at once as the LRA differentiates where members of the applicant. between a notice and demand and does Conclusion The applicant had then attempted to not use said terms interchangeably. This judgment is important as in light interdict the respondent from continu- The court held that the applicant was of it, members of trade unions not party ing to lockout its members at the Labour not a party to the dispute ‘as it was not a to a bargaining council cannot be locked Court and was successful. The respond- member of the bargaining council where out by their employer. ent had then appealed to the Labour Ap- the dispute arose.’ This was because ‘on peal Court (LAC) and its appeal was up- a proper interpretation of section 64(1), held. The applicant had then proceeded the employees referred to in section to appeal to the Constitutional Court 64(1)(c) are employees who were party to (CC). the dispute that was referred for concili- Yashin Bridgemohan LLB (UKZN) is ation in terms of section 64(1)(a). Notice an attorney at Yashin Bridgemohan Issue before the CC under section 64(1)(c) can be given only Attorney in Pietermartizburg. The court noted the main issue was to employees who were party to a bar- q

Employer liable for damages caused to ex-employee due to non-compliance with debarment process

By Daryl Marc de Reynecke v OdinFin (Pty) Ltd (GP) (unreported case no Bruyn 86753/2014, 21-6-2016) (JW Louw J)

n the matter of Reynecke v Odin- from the defendant’s employ on the ba- of s 14(1) of the Act and recorded by the Fin (Pty) Ltd, the plaintiff sued his sis of misconduct in that he was found Financial Services Board (FSB) as follows: previous employer (the defend- to be dishonest about his training at ‘[Reynecke] does not comply with per- ant) for its failure to follow a fair Nedbank. sonal character qualities of honesty and debarment process in terms of • After the plaintiff had left the de- integrity.’ the Financial Services and Inter- fendant’s employ, he accepted a per- • The plaintiff took the defendant’s deci- mediary Services Act 37 of 2002 manent employment position at Ned- sion on review to the High Court where I(the Act), which prevented him from bank to render financial services as its it was subsequently set aside as being earning an income as a representative representative. unlawful administrative action. for approximately 12 months. • Without any further notice, the defend- • After the review proceedings had These are the facts, in summary, which ant took a decision to debar the plain- been finalised, the plaintiff sued the de- led to the plaintiff’s claim: tiff from rendering financial services fendant for loss of income that he • The plaintiff breached his employment in terms of the Act, which led to the sustained for the period July 2013 to contract with the defendant by attend- termination of his employment contract March 2014, during which time he was ing an induction program at Nedbank to with Nedbank. effectively debarred and did not receive pursue a new employment option. • The decision to debar the plaintiff income. • The defendant instituted disciplinary was based on the findings of the chair- The plaintiff’s case as pleaded was proceedings against the plaintiff re- person at the disciplinary proceedings that the defendant had owed him a garding this incident, which the plaintiff without any further process or investiga- legal duty to exercise its administrative failed to attend. tions by the defendant. powers in terms of the Act in a fair man- • At the hearing, the plaintiff was sum- • The decision to debar the plaintiff ner, which the defendant had breached marily dismissed by the chairperson was taken by the defendant in terms by, inter alia, not providing him with

DE REBUS – SEPTEMBER 2016 - 42 - CASE NOTE – LABOUR LAW adequate notice of the debarment pro- by holding that the defendant had in fact How does the Reynecke ceedings and by not providing him with made a finding that the plaintiff was a reasonable opportunity to make rep- not fit and proper for which a fair pro- decision affect the role of resentations. The particulars of claim cess should have been followed by them. the FSPs and the FSB in alleged further that the defendant, in It was further argued by the defend- performing its statutory duty, had acted ant that the imposition of delictual lia- debarment proceedings? negligently and unlawfully. bility on the defendant in the exercise of The following points are important to During the trial, the defendant con- its administrative function would have consider: ceded that its decision to debar the a ‘chilling effect’ on all Financial Service • That a decision to debar a representa- plaintiff without notifying him of its in- Providers (FSPs) when exercising their tive constitutes an administrative ac- tended decision and by not giving him functions in terms of the Act. By this tion, which is subject to the Promotion an opportunity to be heard amounted the defendant meant that an FSP would of Administrative Justice Act 3 of 2000. to unfair administrative action, which for instance be more cautious to debar • That there is a duty on FSPs and the fell to be reviewed and set aside. a representative for fear of exposing it- FSB to follow a fair debarment process The main issue to be decided by the self to potential claims in the future. The when the debarment of a representative court was whether the defendant’s con- court, however, held that the FSP could is contemplated. duct was wrongful in the circumstances. prevent such risks by merely following a • From the policy underlying the Act, It was argued by the defendant that fair procedure prior to a debarment. it is wrongful for any FSP or the FSB to the plaintiff’s cause of action was simi- In para 21 of the Reynecke judgment, debar a representative without following lar to that of Steenkamp NO v Provincial Louw J stated as follows: a fair process, which conduct may re- Tender Board, Eastern Cape 2007 (3) SA ‘If an FSP acts responsibly and fol- sult in the FSP or the FSB being liable for 121 (CC). In Steenkamp, the court held lows a fair administrative process before damages sustained by the representative that a breach of an administrative duty making a bona fide finding that a rep- during the period of debarment. is normally rectified by means of public resentative does not comply with the fit I submit that the court’s decision to law remedies (such as judicial review) and proper requirements and thereafter award damages for economic loss to and that an aggrieved party does not debars the representative, it is unlikely an aggrieved representative, is the first have private law remedies for damages. that such a representative will succeed claim of this nature under the Act and In line with Steenkamp, the defend- with a damages claim against the FSP. possibly even in the context of admin- ant’s point of departure was that admin- But if it debars a representative without istrative law under South African law. It istrative action exercised in a negligent following a fair administrative process is hoped that FSPs and the FSB will take manner is not wrongful in the delictual and thereby potentially causing serious the necessary steps to ensure that fair sense and does not give rise to liability financial harm to the representative, administrative process is followed by for damages unless policy considera- the boni mores would not, in my view, them when exercising any of their pow- tions require that the plaintiff should be require that the FSP be protected from ers in terms of the Act. compensated for such losses. delictual liability.’ It was accordingly argued by the de- Weighing up relevant policy consid- • De Bruyns Attorneys Inc were the in- fendant that their conduct was not erations and facts of the matter, the structing attorneys for the plaintiff. wrongful in that the Act did not confer court held that the defendant’s conduct any discretion on them to debar the towards the plaintiff was wrongful and plaintiff, or not. According to the defend- negligent, and as a result whereof the ant, the provisions of the Act are manda- defendant was held liable for the dam- tory in that they are obliged to debar any age, which the plaintiff is able to prove Daryl Marc de Bruyn BA LAW (Stell) representative who had acted contrary that he suffered as a result of the de- LLB (Unisa) is an attorney at De to the fit and proper requirements. The fendant debarring him as a representa- Bruyns Attorneys Inc in Pretoria. court, however, rejected this argument tive in terms of the Act. q

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DE REBUS – SEPTEMBER 2016 - 43 - NEW LEGISLATION New legislation

Legislation published from 1 – 29 July 2016

Philip Stoop BCom LLM (UP) LLD (Unisa) is an associate professor in the department of mercantile law at Unisa.

Bills introduced Measurement Units and Measurement Amendment of the regulations (fees). Standards Act 18 of 2006 BN408 GG40140/15-7-2016. Liquor Products Amendment Bill B10 of National Measurement Standards. GN814 2016. GG40125/8-7-2016. National Forests Amendment Bill B11 of National Measurement Units. GN813 Draft legislation 2016. GG40125/8-7-2016. Draft Policy on sustainable hydropower Mine Health and Safety Act 29 of 1996 generation in terms of the National Water Selected list of delegated Guideline for a mandatory code of prac- Act 36 of 1998. GenN400 GG40125/8-7- tice for risk based emergency care on a 2016 and GenN436 GG40140/15-7-2016. legislation mine. GN R840 GG40142/15-7-2016. Best practices in terms of the Consum- Guidance note for the implementation er Protection Act 68 of 2008 applicable Basic Conditions of Employment Act 75 of standard threshold shift in the medi- to the motor industry for comment. of 1997 cal surveillance of noise induced hearing GenN402 GG40134/11-7-2016. Amendment of Sectoral Determination loss. GN R839 GG40142/15-7-2016. Proposed Emergency Medical Ser- 11: Taxi sector. GN857 GG40157/25-7- National Environmental Management vices Regulations in terms of the Na- 2016. Act 107 of 1998 tional Health Act 61 of 2003. GN830 Collective Investment Schemes Control Identification of the Minister of Envi- GG40140/15-7-2016. Act 45 of 2002 ronmental Affairs as competent author- Draft Public Administration Manage- Exemption of a manager of a collective ity for the consideration and processing ment Regulations on Conducting Busi- investment scheme in securities from of environmental authorisations and ness with the State and the Disclosure of certain provisions. BN136 GG40166/29- amendments thereto for activities relat- Financial Interests in the Public Services, 7-2016. ed to the integrated resource plan 2010- 2016 in terms of the Public Administra- Commission for Gender Equality Act 2030. GN779 GG40110/1-7-2016. tion Management Act 11 of 2014 for 39 of 1996 National Environmental Management: comments. GN R838 GG40141/15-7- Complaints handling procedures. Biodiversity Act 10 of 2004 2016. GG40111/1-7-2016. Alien and invasive species list, 2016. Revised rules of conduct for regis- Engineering Profession Act 46 of 2000 GN864 GG40166/29-7-2016. tered persons in terms of the Project Rules: Continuing professional develop- National Environmental Management: and Construction Management Profes- ment and renewal of registration. BN97 Integrated Coastal Management Act 24 sions Act 48 of 2000 for comments. GG40125/8-7-2016. of 2008 BN104 GG40149/20-7-2016 and BN135 Fertilizers, Farm Feeds, Agricultural Appeal Regulations. GN R815 GG40163/27-7-2016. Remedies and Stock Remedies Act 36 GG40128/8-7-2016. Draft Amendment Regulations on the of 1947 National Land Transport Act 5 of 2009 establishment of the Consumer Advisery Prohibition on the import, export, pos- Establishment of the National Pub- Panel in terms of the Electronic Com- session, acquisition, sale, use and dis- lic Transport Regulator. GenN378 munications Act 36 of 2005. GenN439 posal of agricultural remedies containing GG40110/1-7-2016. GG40151/21-7-2016. certain substances. GN862 GG40166/29- Private Security Industry Regulations Amendment of the regulations relating 7-2016. Act 56 of 2001 to the qualifications for registration of Health Profession Act 56 of 1974 Amendment of the Improper Conduct dental assistants in terms of the Health Registration of specialists in family med- Regulations. GN R790 GG40116/1-7- Professions Act 56 of 1974 for com- icine. GN777 GG40110/1-7-2016. 2016. ments. GN850 GG40154/22-7-2016. Labour Relations Act 66 of 1995 Amendment of the Code of Conduct Amendment of general regulations made Amendment of regulations. GN R816 for Security Service Providers, 2003. GN in terms of the Medicines and Related GG40128/8-7-2016. R791 GG40116/1-7-2016. Substances Act 101 of 1965 for com- Repeal of the Essential Services Commit- Public Service Act 103 of 1994 ments. GN858 GG40158/25-7-2016. tee Regulations. GN R817 GG40128/8-7- Public Service Regulations, 2016. GN Proposed industry code and ombudsman 2016. R877 and GN R878 GG40167/29-7-2016. scheme for the advertising and market- Local Government: Municipal Systems Tax Administration Act 28 of 2011 ing industry in terms of the Consumer Act 32 of 2000 Organs of State or institutions to which Protection Act 68 of 2008 for comments. Upper limits of total remuneration pack- a senior Sars official may lawfully dis- GenN449 GG40159/26-7-2016. ages payable to municipal managers and close specified information. GN R819 managers directly accountable to munic- GG40128/8-7-2016. ipal managers. GenN380 GG40117/1-7- Veterinary and Para-Veterinary Profes- 2016 and GenN381 GG40118/4-7-2016. sions Act 19 of 1982 

DE REBUS – SEPTEMBER 2016 - 44 - EMPLOYMENT LAW – LABOUR LAW Employment law update

Monique Je erson BA (Wits) LLB (Rho- ment equity plan in place at the time that The municipality admitted that it had des) is an attorney at Bowman Gil llan in it discriminated against the applicant. It a legal duty to protect the complain- Johannesburg. nevertheless argued that it had acted in ant’s rights and prevent her from suf- accordance with its staffing policy con- fering from trauma but argued that it tained in a collective agreement and thus had taken reasonable steps to protect this constituted an affirmative action her and thus was not liable for damages. Affirmative action measure under s 15 of the Employment In this regard, the municipality alleged measures in the absence Equity Act. that it had taken reasonable steps to Coetzee AJ held that an affirmative protect the complainant by requiring the of an employment equity action measure should be based on pre- perpetrator to attend a disciplinary in- plan scribed information and should set out quiry and keeping the complainant and numerical goals and the time period dur- perpetrator at separate sites pending In Solidarity obo Pretorius v City of ing which to achieve those goals. An af- the outcome of the disciplinary inquiry. Tshwane Metropolitan Municipality and firmative action measure must, further- The alleged perpetrator was found guilty Another [2016] 7 BLLR 685 (LC) the ap- more, be capable of being measured and during the disciplinary inquiry and was plicant employee, a white male, applied monitored. It was held that the staffing issued with a final written warning and policy did not comply with the Employ- for a post but was unsuccessful after a two-week suspension without pay. The ment Equity Act as it was not a struc- having been shortlisted and interviewed municipality argued that it was bound tured approach to the implementation for the position. The post was then left by the decision of the chairperson in of affirmative action measures as envis- vacant for a period and was re-adver- the disciplinary proceedings and thus aged in the Employment Equity Act. An tised approximately three months later. it had no alternative but to allow the applicant who is excluded from promo- He again applied and was not shortlisted perpetrator to return to work after the tion would not be able to challenge the this time. It later came to the attention suspension had lapsed. The court, how- process and to uphold the right to hu- of the applicant that when he applied for ever, held that this was incorrect as the man dignity if the employer relied on a the post initially the process had been municipality was not required to simply document to justify the discrimination nullified because the approval of the accept the sanction handed down by the that did not contain measurable numeri- short list was subject to the condition chairperson but could have taken the cal targets and measures. that only applicants from designated sanction on review. It was held that the Employment Eq- groups would be shortlisted and inter- The court held that the perpetrator uity Act requires employers to have an viewed. This condition had been based was liable to pay the complainant dam- employment equity plan setting out on the workplace profile statistics, which ages to the extent that she is able to measurable targets before simply ex- reflected that there were too many white prove that she suffered harm as a result cluding candidates for appointment on males in the group. of his actions. the grounds of race or gender. Thus, the The applicant argued that he had been As regards the municipality’s liability, exclusion of the applicant because he unfairly discriminated against on the ba- the court considered vicarious liability was a white male in the absence of an sis of race and gender when he was not in the context of a working relationship employment equity plan amounted to appointed to the post, which was a post where there is an unequal balance of unfair discrimination. power between the complainant and the that he had been acting in for a period The municipality was ordered to ap- of time. The municipality admitted that perpetrator. Pickering J acknowledged point the applicant to the post with ret- that different factors apply when harass- it discriminated against the applicant by rospective effect. failing to consider him for the position ment is carried out by a superior. In this as he was not a member of a designated Vicarious liability for regard, where an employee is placed in a position of trust, the employer should group but argued that this was not un- sexual harassment in the fair as it was permitted to do so under ensure that the employee is capable of the Employment Equity Act 55 of 1998. workplace trust and thus an employer should be vicariously liable if that person abuses Given the fact that the municipality In PE v Ikwezi Municipality and Another that trust. Reference was also made to admitted that it discriminated against [2016] 7 BLLR 723 (ECG), an employee the employee, the onus was on the mu- was sexually molested and pestered by case law in the United States of America nicipality to prove that the discrimina- her superior during working hours on a where it has been held that where the tion was fair. The court held that if the number of occasions. The complainant harasser is in a position of power the municipality had acted in accordance alleged that she suffered post-traumatic employer is strictly liable. The court held with an affirmative action plan when stress disorder as a result of the sexual the employer and the perpetrator jointly discriminating against the applicant harassment and eventually was forced to and severally liable for damages that the then the discrimination could not have resign. The complainant then instituted complainant may prove were caused by been unfair. The municipality, however, a claim for damages against the munici- the sexual harassment. conceded that it did not have an employ- pality and the perpetrator.

DE REBUS – SEPTEMBER 2016 - 45 - EMPLOYMENT LAW – LABOUR LAW

commissioner is final and binding and it The LAC turned next to Phatshoane AJ may be enforced as if it were an order interpretation of s 143; the judge found of the LC in respect of which a writ has that on the clear language of s 143 ‘the been issued, unless it is an advisory arbi- award of the CCMA may be enforced as tration award. [if it] were an order of the Labour Court (2) … provided a writ has been issued in re- (3) An arbitration award may only be spect thereof.’ enforced in terms of subsection (1) if the The LAC held that the word ‘provided’ director has certified that the arbitration did not feature in s 143. The instructive award is an award contemplated in sub- phrase when interpreting s 143 was ‘as section (1).’ if it were an order of the LC in respect The LAC held that when interpreting of which a writ has been issued’. When the law, regard must be given to the interpreting this phrase the LAC said. Moksha Naidoo BA (Wits) LLB (UKZN) context in which the statute or section ‘By using the words “as if it were”; the is an advocate at the Johannesburg Bar. under review was enacted. This involved legislature created a legal fiction. The examining what the law was before the CCMA is not a court of law and writs are statute or section was passed, what the issued by courts of law and not adminis- mischief was, what remedy the legisla- trative tribunals like the CCMA. In order CCMA writ – a legal fiction ture appointed and the reasons thereof. to overcome this reality, the legislature The LAC said that to construct an in- had to create this fiction. The legisla- CCMA v MBS Transport CC and Others, terpretation of s 143 it was enjoined to ture deemed the CCMA to have a status CCMA v Bheka Management Services supress the mischief and advance the which it would not otherwise have, and (Pty) Ltd and Others (unreported case remedy. consequently established an arrange- no J1807/15, J1706/15, JA94/2015, 28- ment which, without the fiction, would 6-2016) (CJ Musi JA with Davis JA and The history and context be objectionable because it is incompat- Murphy AJA). of s 143 – as set out in the ible with legal principle. … A legal fiction therefore requires us to assume as fact Armed with separate and unrelated ar- LAC judgment that which we know is not true. bitration awards in their favour, two In the original enactment of the LRA, Therefore, section 143(1) read with employees working for two different s 143 stated that an arbitration award section 143(3) means that when an arbi- employers, individually approached the could only be enforced by way of an ap- tration award is certified by the Director, Commission for Conciliation, Mediation plication to the LC in terms of s 158(1) it may be enforced as if it were an order and Arbitration (CCMA) to have their (c) of the LRA. This proved largely inef- of the Labour Court in respect to which a respective awards enforced in terms of fective as both the time and cost factors writ has been issued. We must therefore s 143 of the Labour Relations Act 66 of associated with all applications brought not only assume that it is an order of the 1995 (LRA), this after both employers in the normal course deterred many em- Labour Court but also assume that a writ failed to abide by the remedies set out in ployees from pursuing such recourse. has been issued in respect of that order.’ the respective awards. Once both awards Consequentially an employee whose em- On this interpretation the LAC found were certified in terms of s 143, the employer failed to abide by the award, was that the court a quo erred in its finding ployees delivered same to the relevant left with an empty award. that the CCMA issues writs of execution Sheriff for the latter to execute on. The 2002 amendments to the LRA when certifying an award. The correct in- Both employers approached the La- brought with it an alternative. In terms terpretation was that a certified award, bour Court (LC) on an urgent basis for of the amended s 143, any employee in terms of the 2014 amendments, is an order to stay the enforcement awards whose employer failed to abide by an equivalent to an order of the LC to which pending their applications to review and arbitration award could approach the a writ has been issued. In addition the set aside the arbitration awards granted CCMA Director to have the arbitration LAC held that the LC is seized with the in favour of their respective employee. award certified. Once certified the award power to stay the enforcement of an As both urgent applications called on was given the same status as if it were award, which will include a certified the court to address the same question an order of court. On the strength of the award. in law, the two applications were consoli- certified award the Registrar of the LC For these reasons the LAC set aside the dated and served before Phatshoane AJ. would issue a writ, which the employee LC’s findings and ordered that both mat- When hearing the applications the would thereafter deliver to the Sheriff ters be remitted to the LC for a hearing court a quo mero motu raised the ques- for execution. de novo. No order as to costs was made. tion of whether the CCMA was mandated While this procedure addressed some to issue writs of execution in respect of of the shortfalls associated with the orig-  arbitration awards delivered under its inal s 143, the procedure was neverthe- auspices. Having examined the relevant less unacceptable as it still required an Do you have a sections of the LRA and taking into ac- employee to approach the LC to have the count the fact that the CCMA was not a writ issued. labour law-related court of law, the LC found that the CCMA The 2014 amendments addressed this question that you was not assigned the statutory power to specific issue by introducing a further would like issue writs and, therefore, set aside both amendment to s 143. Effective 2015, writs as they were a ‘nullity for lack of once an award was certified it could be answered? jurisdiction’. presented to a Sheriff for execution with- The CCMA, who did not enter proceed- out an employee having to go to the LC ings before the court a quo, appealed the for a writ. Send your question to aforementioned finding at the Labour Against this background the LAC held Appeal Court (LAC). that the legislature amended s 143 to Moksha Naidoo at: Relevant to the appeal was an interpre- makes it ‘easier, inexpensive, effective derebus@ tation of subs 143(1) and (3) which read: and accessible for a person to enforce a derebus.org.za ‘(1) An arbitration award issued by a certified arbitration award’.

DE REBUS – SEPTEMBER 2016 - 46 - RECENT ARTICLES AND RESEARCH

By Meryl Recent articles and research Federl

Please note that the below abbreviations are to be found in italics Accessing articles from publishers at the end of the title of articles • For LexisNexis articles contact: [email protected] for the and are there to give reference to publication details. the title of the journal the article is published in. To access the ar- • For individual journal articles pricing and orders from Juta contact ticle, please contact the publisher Michelle Govender at [email protected]. directly. Where articles are available on an open access platform, • For journal articles not published by LexisNexis or Juta, contact the Kwa- articles will be hyperlinked on the Zulu-Natal Law Society Library through their helpdesk at help@lawlibrary. De Rebus website at www.derebus. co.za (their terms and conditions can be viewed at www.lawlibrary.co.za). org.za

Abbreviation Title Publisher Volume/issue AHRLJ African Human Rights Law Journal Pretoria University Law Press (2016) AJ Acta Juridica Juta 2016 JJS Journal for Juridical Science University of the Free State, (2016) Faculty of Law

LitNet LitNet Akademies (Regte) Trust vir Afrikaans Onderwys (2016) July PER Potchefstroom Electronic Law Journal / North West University, Faculty (2016) July Potchefstroomse Elektroniese Regsblad Of Law SAJHR South African Journal on Human Rights Taylor and Francis (2016)

Administration of estates rikaanse verbruikersinsolvensiereg: In- not in the employ of the National Pros- ternasionale tendense en riglyne’ (2016) ecuting Authority’ (2016) JJS 44. Muller-Van der Westhuizen, C and July LitNet. Nhlapo, Z ‘Practical challenges relat- Customary law ing to the supervision of small estates’ Company law Spies, A ‘The importance and relevance (2016) JJS 1. Lombard, M and Swart, C ‘Vonnisbe- of amicus curiae participation in litigat- African Commission on spreking: Turquand en estoppel: Voëls ing on the customary law of marriage’ van eenderse vere? One Stop Financial (2016) 16.1 AHRLJ 247. human and peoples’ rights Services (Pty) Ltd v Neffensaan Ontwikke- Enabulele, AO ‘Incompatibility of na- lings (Pty) (The CRL Trust as Intervening Customs law tional law with the African Charter on Creditor) 2015 (4) SA 623 (WKK)’ (2016) Fritz, C ‘Customs searches: Past, present Human and Peoples’ Rights: Does the July LitNet. and future’ (2016) JJS 19. African Court on Human and Peoples’ Rights have the final say?’ (2016) 16.1 Constitutional law Health law AHRLJ 1. Dube, A and Nhlabatsi, S ‘The King can Wayburne, PA ‘Substantive equality Ndahinda, FM ‘Peoples’ rights, indig- do no wrong: The impact of The Law and adverse effect discrimination in the enous rights and interpretative ambi- Society of Swaziland v Simelane NO & context of National Health Insurance in guities in decisions of the African Com- Others on constitutionalism’ (2016) 16.1 South Africa’ (2016) SAJHR. mission on Human and Peoples’ Rights’ AHRLJ 265. (2016) 16.1 AHRLJ 29. Human rights Contract Adeleke, F ‘Human rights and interna- Child law Bekker, T ‘Die interpretasiereël in die tional investment arbitration’ (2016) SA- Chirwa, DM ‘Children’s rights, domestic Suid-Afrikaanse kontraktereg (deel 1)’ JHR. www.nisc.co.za alternative care frameworks and judicial (2016) JJS 99. Adeola, R ‘The right not to be arbitrar- responses to restrictions on inter-coun- ily displaced under the United Nations try adoption: A case study of Malawi and Criminal law Guiding Principles on Internal Displace- Uganda’ (2016) 16.1 AHRLJ 117. Du Toit, PG ‘Die strafregtelike aanspreek- ment’ (2016) 16.1 AHRLJ 83. likheid van regspersone: Lesse uit Kanada’ Jegede, AO ‘Rights away from home: Customary law (2016) JJS 83. Climate-induced displacement of in- Rautenbach, C ‘A family home, five sis- Naidoo, K and Karels, MG ‘Prosecuting digenous peoples and the extraterrito- ters and the rule of ultimogeniture: Ju- “hate”: An overview of problem areas re- rial application of the Kampala Conven- dicial approaches to customary law in lating to hate crimes and challenges to tion’ (2016) 16.1 AHRLJ 58. South Africa and Botswana’ (2016) 16.1 criminal litigation’ (2016) JJS 65. Mpanga, PM ‘Interpreting the human AHRLJ 145. Namakula, CS ‘The court record and the right to water as a means to advance its q right to a fair trial: Botswana and Ugan- enforcement in Uganda’ (2016) 16.1 AH- Consumer law da’ (2016) 16.1 AHRLJ 175. RLJ 204. Roestoff, M ‘Rehabilitasie in die Suid-Af- Tshehla, B ‘Engagement of prosecutors Rafudeen, A ‘A South African reflection

DE REBUS – SEPTEMBER 2016 - 47 - RECENT ARTICLES AND RESEARCH on the nature of human rights’ (2016) conflict in Northern Uganda’ (2016) AJ tigation and prosecution of international 16.1 AHRLJ 225. 247. crimes in South Africa’ (2016) AJ 129. Mudukuti, A ‘The Zimbabwe torture International criminal law case: Reflections on domestic litigation Labour law Du Plessis, M and Gevers, C ‘Civil soci- for international crimes in Africa Nation- Manson, G and Gwanyanya, MG ‘Legal ety, “positive complementarity” and the al Commissioner of The South African formalism and the new Constitution: “torture docket” case National Commis- Police Service v Southern African Human An analysis of the recent Zimbabwe Su- sioner of The South African Police Service Rights Litigation Centre and Another preme Court decision in Nyamande & v Southern African Human Rights Liti- (CCT 02/14) [2014] ZACC 30’ (2016) AJ Another v Zuva Petroleum’ (2016) 16.1 gation Centre and Another (CCT 02/14) 287. AHRLJ 283. [2014] ZACC 30’ (2016) AJ 158. Osasona, TA ‘Call to action: National bar Millard, D and Bascerano, EG ‘Employ- Dugard, J ‘International criminal law, the associations as key civil society actors ers’ statutory vicarious liability in terms International Criminal Court and civil so- for the promotion of international crimi- of the protection of personal informa- ciety’ (2016) AJ 3. nal justice in Africa’ (2016) AJ 272. tion Act’ (2016) PER. Durbach, A ‘An essential intervention: Schwarz, A ‘The legacy of the Kenyatta Civil society responses to redressing and case: Trials in absentia at the Interna- preventing violence against women in tional Criminal Court and their compat- post-Apartheid South Africa’ (2016) AJ ibility with human rights’ (2016) 16.1 Meryl Federl BA HDip Lib (Wits) is 202. AHRLJ 99. an archivist at the Johannesburg So- Ferstman, C ‘Prosecutorial discretion Shaw, M ‘Crisis and contradiction: Jus- ciety of Advocates library. E-mail: and victims’ rights at the International tice reform society and Zimbabwe’s long [email protected] q Criminal Court: Demarcating the battle transition’ (2016) AJ 179. lines’ (2016) AJ 17. Van der Merwe, H and Brankovic, J ‘The Gevers, C ‘Back to the future: Civil so- role of African civil society in shaping For links to open access ciety, the “turn to complementarity” in national transitional justice agendas and Africa and some critical concerns’ (2016) policies’ (2016) AJ 225. law journals and open AJ 95. Williams, S and Palmer, E ‘Civil society access websites visit Keppler, E ‘Challenges for international and amicus curiae interventions in the criminal justice in Africa and the role of International Criminal Court’ (2016) AJ the De Rebus website at civil society’ (2016) AJ 66. 40. Kunej, S and Ochen, V ‘The case for a Woolaver, H ‘Partners in complementa- www.derebus.org.za victim-friendly ICC: Reparations and the rity: The role of civil society in the inves-

Case Management in our Courts a new direction New Seminar on Latest Enhancements to Case Management in Courts The study material to be used by delegates is a new publication “hot off the press” with the latest on case management Seminar delegates will receive the Book but it will also be available for sale from LEAD. Email [email protected] Seminar dates Bloemfontein: 3-4 October Durban: 6-7 October East London:17-18 October Midrand: 20-21 October Polokwane: 31 Oct & 1 Nov Cape Town: 17-18 November

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