INDEX1

EDITORIAL

SOUTH AFRICAN LAW REPORTS DECEMBER 2015

SA CRIMINAL LAW REPORTS DECEMBER 2015

All SOUTH AFRICAN LAW REPORTS DECEMBER 2015 PART 1

ALL SOUTH AFRICAN LAW REPORTS DECEMBER 2015 PART 2

EDITORIAL

Welcome back!

2016 promises to be a great year, we even have an extra day! (February 29 th, leap year)

Do you have any new year’s resolutions?

If one of them is to make better use of your time, cave canem2 !

Many years ago I bought a book on time management and I thought this book will teach me to delegate, cut out long calls, and order my time. Set goals, set schedules.To my surprise the book taught to me something else: the author wrote that we all have 24 hours per day, time is priority. You will not be remembered for being at office every day from 8 to 5. (When you retire you get a golden watch, for what?)You are remembered, and in fact you yourself remember EVENTS. Yes, what you experienced, i.e. completing an LLB, LLM or completing a 10 km fun run. Why is time “priority”?Because we all have time. But if I am too busy to visit you, I actually say that I do not have priority TIME for you, or for my aunt in the old age home.

1 A reminder that these Legal Notes are my summaries of all reported cases as are set out in the Index. In other words where I refer to the June 2012 SACR , you will find summaries of all the cases in that book. It is for private use only. It is only an indication as to what was reported, a tool to help you to see if there is a case that you can use!

2 Beware of the dog

LEGAL NOTES VOL 1/2016

Compiled by: Adv M Klein

Your child remembers the day you took him for a walk, not the money you brought home. I started applying this principal many years ago, there is one example that stands out, in December 2002 I decided to take my son to Durban per aeroplane. He was brain retarded and I was told it would not be possible and would not work out. I nevertheless did it. We got on the plain, he was seated at the window, I was next and the aisle seat was taken up by a man who happened to have a cousin with the same condition, no problem! But to my amazement, my son was glued to his seat, the height and clouds were too much for him. And that was the last Christmas he spent on earth. I am so glad I did it!

May you have a wonderful 2016!

Matthew

SA LAW REPORTS DECEMBER 2015

KROK AND ANOTHER v COMMISSIONER, SOUTH AFRICAN REVENUE SERVICE 2015 (6) SA 317 (SCA) 2015 (6)

Revenue — Double taxation agreement — Amendment of to provide for mutual assistance in tax recovery — Whether applicable to tax debts arising prior to such amendment becoming effective. This case concerns an appeal against a preservation order granted by the court a quo against the first appellant (the taxpayer) pursuant to an application by the South African Revenue Service (Sars) for tax recovery on behalf of a foreign government, as contemplated in s 185 read with s 163 of the Tax Administration Act 28 of 2011 (the Act). The application followed a request by the Australian Tax Office (the ATO) — made in terms of art 25A of the double taxation agreement (the DTA) between South Africa and Australia — for the conservancy of the taxpayer's locally situated assets pending collection of a tax debt.Article 25A provides for mutual assistance in the collection of taxes and was inserted by a Protocol amending the DTA with effect from 12 November 2008. In terms of art 13(2)(a)(ii) of the Protocol, with regard to Australian tax, the Protocol applies to 'income, profit or gains of any year of income beginning on or after 1 July in the calendar year next following the date on which the protocol enters into force'; and in terms of art 13(d) of the Protocol, it applies 'for the purposes of [art] 25A, from a date to be agreed in an Exchange of Notes through the diplomatic channel', which date was 1 July 2010. The main issue before the Supreme Court of Appeal was the taxpayer's jurisdictional challenge to the preservation order, namely that since the taxes claimed here arose before the temporal limitation imposed by art 13(2)(a)(ii), they fell beyond the scope of the DTA and thus there was no basis for the invocation of the conservancy provisions of the Act. Held Art 13 did not purport to form part of the DTA: its plain wording merely provided the dates from which the amendments to the DTA would come into effect. Article 2 (which dealt with taxes covered by the DTA) said nothing whatsoever about any time limitations. The new art 2.4 of the DTA provided that for the purposes of art 25 and the new art 25A, the taxes to which the DTA applied were 'taxes of every kind and description imposed under the . . . tax laws [of Australia]'. Article 25A was concerned

with proceedings for enforcement and had no bearing on liability to tax; the taxes to which it related need not be limited by reference to the date of their accrual. Therefore, when art 25A entered into force on 1 July 2010 in terms of art 13(2)(d), it applied to a revenue claim, ie an amount owed in respect of taxes of every kind and description, to which art 13(2)(a)(ii) had no application. The taxpayer's jurisdictional challenge to the preservation order accordingly failed. In the result, the appeal was dismissed.

MTHIMUNYE-BAKORO v PETROLEUM AND OIL CORPORATION OF SOUTH AFRICA (SOC) LTD AND ANOTHER 2015 (6) SA 338 (WCC)

Company — Directors and officers — Board of directors — Meetings — Validity — Exclusion of director — Board may, due to manifest conflict of interest that would otherwise obtain, exclude director from meeting dealing with his or her suspension — Companies Act 71 of 2008, s 75(5).

Company — Directors and officers — Board of directors — Resolutions — Validity — Suspension of director — Majority of directors passing resolution to suspend director without director being present — Board may, due to manifest conflict of interest that would otherwise obtain, exclude director from meeting dealing with his or her suspension — Companies Act 71 of 2008, s 75(5).

Company — Directors and officers — Director — Fiduciary duty — Duty to avoid conflict of interest — Duty to abstain from participating in board meeting at which matter in which he or she has personal financial interest to be considered — Duty triggered when meeting deals with his or her suspension, even if on full pay — Companies Act 71 of 2008, s 75(5).

Company — Principles of corporate governance — Collective governance by board of directors — Exclusion of minority (executive) directors from meeting by majority (non-executive) directors — Justified if meeting held to decide matter on which minority were manifestly conflicted — Companies Act 71 of 2008, s 75(5).

The applicant, the chief financial officer of the first respondent (PetroSA, the state-owned petroleum company), applied to have two of PetroSA's board meetings — at which the eight non-executive directors voted in favour of a resolution suspending her and the CEO — declared unlawful, and the decisions and resolutions taken at them invalidated. PetroSA alleged that the company lost R15 billion due to the poor performance of the two executive directors, and offered them 'garden leave' on full pay pending the outcome of the investigation. When the offer was refused by the applicant, the company informed her that she would be placed on precautionary suspension due to the potentially disruptive effect of her presence at work.The two executive directors — the applicant and the CEO — were first suspended at a meeting of the non-executive directors, held on 18 June 2015, to which neither executive director was invited. On July 13 the non-executive directors held a further meeting to reconsider the decisions taken at the first meeting. This time the applicant and the CEO attended and made representations, but the board reaffirmed its decision to suspend them pending an investigation and ensuing disciplinary enquiry. The applicant challenged her suspension on the ground that it contravened not only the law but also, by excluding her from the June 18 meeting, basic principles of

corporate governance. In response PetroSA argued that it would have been wrong to invite the applicant to a meeting in which she could not participate because it concerned her status.PetroSA sought justification for the exclusion of the officers in s 75(5) of the Companies Act 71 of 2008, which provides that if a director has a personal financial interest in a matter to be considered at a board meeting, he must disclose the nature of his interest and may not take part in the consideration of the matter at hand. 'Personal financial interest' is widely defined in s 1 of the Act to mean 'a direct material interest . . . of a financial, monetary or economic nature to which a monetary value may be attributed'. The applicant argued that the principles of corporate governance required the participation of the full board, and not merely the majority, and that the exclusion of the applicant and the CEO meant that the resolutions of June 18 had to be set aside. The applicant contended that the July 13 decision was predetermined by the June 18 decision and that there had been no proper determination on July 13 as to whether there was conflict on the matters for consideration. She further submitted any potential conflict of interest was negated by the fact that the suspensions of the applicant and the CEO were on full pay. This being so, the July 13 meeting and the decision to suspend the applicant had to be declared invalid.Held As to the validity of the June 18 meeting and the resolutions taken at it: A director facing suspension had a manifest conflict of interest in the deliberations on the suspension to be undertaken by the board and would be prevented from participating in them by both s 75(5) of the Companies Act and the common law, which prohibited a director like the applicant from placing herself in a position in which she had a personal interest that conflicted with her duties to the company. Hence directors such as the applicant and the CEO would be barred from participating in board meetings dealing with their suspension, even if it were on full pay, for the reputational damage and the potential damage to their future with the company were sufficient to constitute the required 'financial interest' under s 75(5) and would, moreover, also bar them from participating under the common law. But, leaving out the legality of the June 18 meeting, the July 13 meeting was validly held and the decisions there validly taken. This being the case, the application fell to be dismissed.

BS v MS AND ANOTHER 2015 (6) SA 356 (GP)

Delict — Elements — Unlawfulness or wrongfulness — Liability for omission — Duty of property owners to protect visiting children from injury or harm on their property — Sufficiency of warning to parents of danger posed by fishpond.

The plaintiff, the father of B, his minor daughter, sued the defendants for damages arising out of the brain damage B sustained after falling into a fishpond on defendants' property. The plaintiff and his ex-wife were the defendants' friends and their guests on the day of the accident. It was common cause that the defendants informed the plaintiff and his ex-wife of the danger posed by the fishpond.Held Though there was a legal duty on property owners not to expose their guests or their children to harm or injury, they were not expected to go beyond reasonable means to make their property safe. The presence of a parent or guardian would, moreover, in certain circumstances exempt a defendant from a duty of care that

would otherwise exist towards the child. In the present case the warning given by the defendants was, given the proximity of the plaintiff and his ex-wife to B, and the reasonable expectation that they would supervise B accordingly, sufficient to discharge the legal duty resting on them, and the plaintiff's claim would accordingly be dismissed.

ACKERMANS LTD v COMMISSIONER, SOUTH AFRICAN REVENUE SERVICE 2015 (6) SA 364 (GP)

Revenue — Assessment to tax — Additional assessment — Review — Jurisdiction — High Court's jurisdiction to review Commissioner's decision to raise additional assessment confirmed — Tax Administration Act 28 of 2011, s 157; Constitution, ss 169 and 237.Revenue — Assessment to tax — Additional assessment — Raising of after three years from last assessment — Time limits with which Commissioner must comply — Application of proviso in Income Tax Act 58 of 1962, s 79(1)(c)(i)(aa).Section 79 of the Income Tax Act 58 of 1962 (the Act) provided for limitation of the period within which it was permissible to raise an additional assessment, ie within three years from the date of the last assessment, unless (in terms of s 79(1)(c)(i)(aa)) the Commissioner was satisfied that the amount assessed in the relevant additional assessment was not assessed in the last assessment due to fraud, misrepresentation or non-disclosure of material facts by the taxpayer.This case concerned the taxpayer's application to review a number of additional assessments which the Commissioner had issued more than three years after the last assessment, and after delay of more than six years since indicating an intention to do so. The grounds for review were that the delay rendered the decision unreasonable and was procedurally unfair administrative action under s 6 of the Promotion of Administrative Justice Act 3 of 2000 (PAJA); was in breach of the principle that the exercise of public power must be in accordance with the Constitution (in this case s 237 which provided that '(a) constitutional obligations must be performed diligently and without delay'); and non-compliant with the three-year time period within which it was permissible to raise additional assessments as set by s 79(1) of the Act. The Commissioner countered (inter alia) by taking the point in limine that the High Court did not have jurisdiction to decide the matter because it raised complex issues requiring the expertise of the tax court.Held Here the review application under PAJA raised an issue concerning the protection of a fundamental right. Section 169 of the Constitution empowered the High Court to decide on any constitutional matter, including matters relating to the protection or enforcement of fundamental rights, unless that matter is assigned to a court of equal status to the High Court. Moreover, s 105 of the Tax Administration Act 28 of 2011 specifically provided for the High Court as a '(f)orum for dispute of assessment or decision'. That there was no merit in the point in limine was also borne out by case law. It was indeed imperative that all constitutional obligations executed by organs of state in the exercise of public power must be performed diligently and without delay; an unreasonable delay would result in a procedurally unfair administrative action which would be reviewable conduct in terms of s 6 of PAJA. Here it was not disputed that there was a delay of approximately six years in issuing the additional assessments. The question was whether this delay was unreasonable. Section 237

of the Constitution did not state what period would constitute an unreasonable delay in any given situation. This was left to the courts to determine, having regard to the circumstances of each case. A determination of the reasonableness or otherwise of the delay required a consideration of time periods in s 79(1) of the Act within which it was permissible to raise additional assessments, and whether the proviso in s 79(1)(c)(i)(aa) applied. There was clearly a dispute of fact regarding the evidence required to decide whether the proviso applied. This required the expertise of a tax court to adjudicate. The adjudication (in the tax court) of the disputed facts — the allegations of misrepresentation and non-disclosure of material facts — should bring this matter to finality.

HENNIE LAMBRECHTS ARCHITECTS v BOMBENERO INVESTMENTS (PTY) LTD 2015 (6) SA 375 (FB)

Company — Proceedings by and against — Security for costs — Application for furnishing of — Approach of court — New Companies Act lacking provision allowing court to order company to furnish security for costs of opponent — Court developing common law to fill gap left by omission — Company to show it has sufficient funds to pay costs

While s 13 of the old Companies Act 61 of 1973 made provision for the setting of security for costs by plaintiff or applicant companies, the new Companies Act 71 of 2008 lacks an equivalent provision. The common law, which applied to natural persons, was that incola plaintiffs would only in exceptional circumstances be ordered to set security for costs. The present case was an appeal to a full bench from a decision of a single judge who held that the legislature, by not re-enacting s 13, intended to protect the right of impecunious companies to litigate. Having found that the respondent's litigation was not vexatious, the judge refused the appellant's application for an order directing the respondent to set security for costs. The appeal court (per Mocumie J for the majority) analysed the various ways in which the 'missing-provision' question had been dealt with by the courts. The majority judgment pointed out that treating companies like natural persons by requiring them to set security only in exceptional circumstances would be unfair to their opponents, who might have to bear the costs of vexatious litigation by insolvent companies. Hence the common law ought to be developed by requiring incola companies faced with applications for the setting of security to show that they had sufficient funds to satisfy an adverse costs order. The court hearing the application would then have the discretion to make an order that was reasonable in the circumstances. The majority proceeded to uphold the appeal on the ground that the court a quo failed to apply the principles laid down under the former s 13, which, in its opinion, should have been retained by the legislature. In a dissenting judgment Moloi J held that the legislature deliberately omitted a s 13-like provision from the new Companies Act, and that the courts should not be allowed to subvert the legislature by resuscitating it.

KGOTHULE v MAJONGA AND OTHERS 2015 (6) SA 389 (FB)

Media — Freedom of expression — Limitations — Defamation — Public official — Article in newspaper critical of performance of MEC in annual 'report card' — Statements not defamatory — Editor acting reasonably and not negligently — Court cautioning politicians to realise high trees caught more wind: robust debate was essential to democracy and public was entitled to airing of views politicians might not agree with. A former Free State MEC for Sports, Arts, Culture and Recreation sued a certain weekly newspaper and its editor for defamation over an article critical of his performance in a report on the Premier's first year in office. Concerns and complaints were raised relating to problems in the running of the department, his personal conduct and frosty relationships with senior staff members. The MEC claimed that the article conveyed the message that he had neglected his duties as a public official and this would lower him in the esteem of right-thinking members of the public.The court dismissed the claim, holding that the reasonable right-thinking reader would not read the article as conveying the message that the plaintiff was not fit to hold office: the proof thereof was that the Premier had not seen fit to remove the plaintiff as MEC after the article was published — he remained in office for a further four years. Further, on the evidence, there were clearly a number of problems with regard to arts and culture in the province and the public was entitled to believe that the plaintiff, in his capacity as head of department in the legislature, had failed it. The editor had also acted as a responsible journalist, pointing out complaints and allegations, and acted reasonably and not negligently in writing the article. The court noted further that politicians had to realise that high trees caught more wind. The public was entitled to have views aired that politicians might not agree with. Journalists should not have to look over their shoulders every time they wrote articles, to ensure that they did not offend politicians. Robust debate was essential to a democracy. PREMIER, EASTERN CAPE AND OTHERS v NTAMO AND OTHERS 2015 (6) SA 400 (ECB)

Customary law — Headmen — Identification — Explained — Eastern Cape Traditional Leadership and Governance Act 4 of 2005, s 18 (EC).

In this matter the headman of the Cala Reserve in the Eastern Cape retired, and — per customary law — the community elected a replacement. However, the royal family identified its own candidate who was recognised in terms of s 18 of the Eastern Cape Traditional Leadership and Governance Act 4 of 2005. This identification and recognition were set aside by the High Court, but its ruling was appealed.On appeal, the question was whether the royal family and the relevant MEC had complied with s 18. It provides:'18 Recognition of an iNkosi or iNkosana(1) Whenever the position of an iNkosi or iNkosana is to be filled —E (a) the royal family concerned must subject to such conditions and procedure as prescribed, within sixty days after the position becomes vacant, and with due regard to applicable customary law —(i) identify a person who qualifies in terms of customary law to assume the position in question, after taking into account F whether any of the grounds referred to in section 6(3) apply to that person; and

(ii) through the relevant customary structure, inform the Premier of the particulars of the person so identified to fill the position and of the reasons for the identification of that person; and(b) The Premier must, subject to subsection (5), by notice in the G Gazette, recognise the person so identified by the royal family as an iNkosi or iNkosana, as the case may be.'Held, that the way the royal family identified the candidate was governed by the 'applicable customary law'; and the person had to qualify 'in terms of customary law'. (The individual could also not be disqualified on one of the grounds in s 6(3).)

This meant that what the customary law was would be raised in each case; and that, practically, the way a royal family identified candidates could differ, depending on the customary law applicable. Here, the 'applicable customary law' was that the community elected the headman; and the person who qualified 'in terms of customary law' was an individual elected by the community. Thus the MEC's recognition of the unelected candidate was invalid, and the court had correctly set it aside. Appeal dismissed

CHETTY t/a NATIONWIDE ELECTRICAL v HART AND ANOTHER NNO 2015 (6) SA 424 (SCA)

Company — Business rescue — Moratorium on legal proceedings against company — Meaning of 'legal proceeding' — Companies Act 71 of 2008, C s 133(1).Company — Business rescue — Moratorium on legal proceedings against company — Requirement that party obtain practitioner's consent to commence or proceed with legal proceedings against company — Effect of not obtaining consent — Party who may invoke non-compliance with requirement — Companies Act 71 of 2008, s 133(1)(a).

Ms Chetty and a company became involved in a contractual dispute and referred it to arbitration. The arbitration began in December 2011 and ran until all the evidence had been led. It was then postponed and argument arranged for 12 October 2012.On 5 October 2012 the company filed a resolution placing itself in business rescue; and on 11 October the rescue was registered and a business rescue practitioner appointed.The commencement of the rescue activated the moratorium on legal proceedings in s 133(1) of the Companies Act 71 of 2008. It provides:'During business rescue proceedings, no legal proceeding . . . against the company . . . may be commenced or proceeded with in any forum, except —(a) with the written consent of the practitioner; . . . .'On 12 October, unaware of the rescue, the arbitrator heard argument; and on 23 October, still unaware, made his award. Chetty was also unaware, and consequently did not seek the practitioner's consent to continue with the proceedings. The practitioner himself did nothing to bring the rescue to Chetty's attention.In the award the arbitrator upheld Chetty's claim, as well as the company's substantially larger counterclaim.Dissatisfied with the outcome, Chetty sought to set aside the award, and invoked s 133(1). She asserted that the arbitration was a 'legal proceeding'; and that the

absence of consent nullified the part of the award in her favour, and the part against her.The company contended that the moratorium did not apply to arbitrations; but that, even if it did, the award was not a nullity.The High Court ruled that 'legal proceeding(s)' did not include arbitrations, and dismissed the application. Chetty appealed to the Supreme Court of Appeal.In issue were:(1) The meaning of 'legal proceeding' in s 133(1).Held, that it included an arbitration. (2) The effect of not obtaining 'consent' in s 133(1)(a).Held, that it did not invalidate the legal proceedings. (3) Who may invoke s 133(1)(a)?Held, that only the practitioner may invoke non-compliance with s 133(1)(a) as a defence. Chetty hence succeeded in showing that an arbitration was a 'legal proceeding'; but failed to persuade that non-compliance with s 133(1)(a) resulted in nullity, or that she could invoke the subsection. Appeal dismissed.

TSHWANE CITY v LINK AFRICA AND OTHERS 2015 (6) SA 440 (CC) Constitutional law — Human rights — Right to property — Deprivation of property — What constitutes — Statutory right of network operator to use city infrastructure for installation of telecommunications network — Common law of servitudes and statute itself protecting property rights — No arbitrary deprivation — Provisions valid — Electronic Communications Act 36 of 2005, s 22 and s 24.

Telecommunication — Network — Installation — Statutory right of network operator to use city infrastructure to install network — Not violating property rights — Provisions valid — Electronic Communications Act 36 of 2005, s 22 and s 24.Servitude — Public servitude — What constitutes — Statutory right of service provider to install and maintain telecommunications network — 'Due regard to applicable law' — Importation of common-law principles — Civiliter modo requirement.

The present case deals with the statutory right of electronic communications network operators (licensees) to use existing city infrastructure for their networks, and whether this entailed an unconstitutional deprivation of property.Section 22 of the Electronic Communications Act 36 of 2005 (the ECA) allows licensees to enter any land to install and maintain a cable network. While notice or permission is not overtly required, licensees must have 'due regard' to 'applicable law' (s 22(2)). Section 24 allows licensees to use existing tunnels and pipes for their networks, but requires notice to the owners (s 24(1)). The City argued that the provisions violated the right to property in s 25 of the Constitution, while Link Africa and the other service providers who joined it argued that s 25 of the Constitution protected private property owners and not organs of state like the city.In 2013 Link Africa, a network licence-holder and operator under the ECA, notified the city that it planned to run fibre-optic cabling through the City's underground infrastructure. Though it obtained an initial go-ahead from the City, the City later took exception to Link Africa's plans and sought an interdict from the Gauteng Division. It also launched a constitutional attack on s 22 and s 24 of the ECA. The High Court sided with Link Africa, as did the Supreme Court of Appeal, which refused leave to

appeal. The High Court specifically found that s 22 did not require the consent of the property owner; that it was doubtful that the City was a bearer of rights under s 25 of the Constitution; that s 22 of the ECA did not authorise arbitrary deprivation of property; and that what Link Africa proposed to do was for the benefit of the City residents and did not constitute deprivation. In an application for leave appeal to the Constitutional Court —Majority judgment (per Cameron J and Froneman J; with Khampepe J, Madlanga J, Molemela AJ and Theron AJ concurring)The court a quo correctly found that neither s 22 nor s 24 of the ECA permitted the arbitrary deprivation of property. The ECA, which was modelled on earlier statutes which conferred necessary powers on agents to install communications and other networks for the public good, was beneficial legislation that could be upheld without straining the existing law. The absolute notion of ownership embraced by the minority judgment was alien to our jurisprudence, which recognised that ownership rights were subject to societal imperatives, a principle that found expression in the common law relating to statutory (public) servitudes. The existence of this category, with its requirements of fair procedures and equitable compensation, rebutted the City's challenge to the validity of the impugned provisions. Hence the real issue before the court was not about entry without consent, but about the common-law rights of a property owner confronted by public servitude over his or her land. Since the challenged provisions imported, expressly or by implication, the protection afforded by the common law of servitudes, neither provision inflicted an arbitrary deprivation of property. Appeal dismissed.

Minority judgment (per Jafta J and Tshiqi AJ; with Moseneke DCJ and Nkabinde J concurring)Both the impugned sections should be invalidated on the ground that they sanctioned the arbitrary, unjustified and hence unconstitutional deprivation of property. LEGAL AID SOUTH AFRICA v MAGIDIWANA AND OTHERS 2015 (6) SA 494 (CC)

Constitutional law — Human rights — Right of access to courts — Right to legal representation before commission of inquiry — No obligation on Legal Aid South Africa to fund such legal representation — Constitution, s 34.

During August 2012 employees of Lonmin plc Mine in Marikana, Rustenburg, F went on strike for wage increases. The respondent miners were amongst those who had been injured or arrested during the strike in which a number of people were killed. The President subsequently established the Marikana Commission of Inquiry (the Commission) to investigate and make recommendations on the role and conduct of various state and private parties in promoting the conflict which gave rise to the incident.The miners, whose conduct was under scrutiny, secured private funding for legal representation but only for a limited period. They turned to the applicant, Legal Aid South Africa (Legal Aid), to fund legal representation for the remainder of the Commission. Legal Aid refused the application because its funding-scheme guidelines made no provision for commissions of inquiry. It also cited severe

budgetary constraints as it had already committed to funding legal representation for the families of the deceased.The miners took the matter to the North Gauteng High Court, Pretoria, seeking to compel Legal Aid to provide the requisite funding. The High Court found for the miners, holding that Legal Aid's refusal was irrational and in violation of their constitutional right to equality before the law, right against unfair discrimination and right to access to a fair public hearing (s 34 of the Constitution). Legal Aid appealed to the Supreme Court of Appeal (SCA) but reached an agreement with the miners to provide the required funding before the hearing. The SCA dismissed the appeal on the basis that the matter was moot.Legal Aid then applied to the Constitutional court for leave to appeal. There it contended that the High Court had laid down incorrect principles of law which would impact upon the future work of Legal Aid and its discretion in funding decisions in analogous cases. The respondents pointed to A developments after the High Court decision, including the updating of the funding-scheme guidelines to include funding of legal representation at commissions of inquiry in certain instances. Any decision on the matter, they argued, was therefore irrelevant to future cases.

Majority judgment (per Theron AJ; with Moseneke DCJ, Cameron J, Froneman J, Jafta J, Khampepe J, Molemela AJ and Tshiqi AJ concurring)Legal Aid's application for leave to appeal fell to be dismissed on the basis that it was moot: the decision of the High Court would have no practical effect on any of the parties. Further, the High Court's interpretation of the right to a fair public hearing did not affect Legal Aid's discretion to make future funding decisions and imposed no obligation on Legal Aid to provide legal representation at future commissions of inquiry. Minority judgment (per Nkabinde J)While the matter was indeed moot, it was nevertheless in the public interest for the court to decide it. In her view the High Court's judgment rested on a novel and expansive interpretation of the right in s 34 which would have a practical effect on Legal Aid's operations and those whose interests it was mandated to protect. She would have found that the provision did not oblige Legal Aid to fund the miners' representation before the Commission. She also considered that the High Court had erred in finding that Legal Aid had acted irrationally or infringed the miners' right to equality.

SACR DECEMBER 2015 MOUSSA v THE STATE AND ANOTHER 2015 (2) SACR 537 (SCA)

Prosecuting authority — Prosecutor — Authority of — Ad hoc prosecutor appointed in terms of s 38 of National Prosecuting Authority Act 32 of 1998 — Validity of appointment challenged as being in conflict with s 179(4) of Constitution, as such prosecutors were not required to take oath like permanently appointed prosecutors in terms of s 32 — Ad hoc prosecutors normal prosecutors under control of senior NPA officers — Section 38 constitutionally sound.

Section 32 of the National Prosecuting Authority Act 32 of 1998 requires permanently appointed prosecutors to take an oath of office that they will carry out their duties in the prescribed manner. The absence of an oath in s 38 in respect of

private counsel appointed in terms of the NPA Act does not detract from the manner in which they are required to perform their duties. Section 38 simply authorises the employment of ad hoc prosecutors to carry out specific and limited tasks on behalf of the NPA but does not specify their constitutional duties because those ad hoc prosecutors are 'prosecutors' in the normal sense of the word and are subject to the control of senior officers of the NPA within the structure of the NPA Act. They are part of the prosecuting authority whose constitutional duties are set out in s 32 of the NPA Act. It therefore follows that s 38 of the NPA Act is not unconstitutional for being in conflict with s 179(4) of the Constitution, which requires that the prosecuting authority must act without fear, favour or prejudice. 

S v MAXABANISO 2015 (2) SACR 553 (ECP)Rape — Charge — Correct way of charging — Where victim raped more than once in course of single encounter — Proper to charge with one count of rape.

The appellant appealed against his conviction and sentence of 15 years' imprisonment imposed in a regional magistrates' court for rape. The evidence showed that the appellant had raped the complainant twice during the course of one encounter with her. The two incidents of rape were separated by an interruption when the appellant went to the toilet. The state indicated at the commencement of the trial that 'sections 51 and/or 52' and sch 2 to the Criminal Law Amendment Act 105 of 1997 were applicable and that it would seek a sentence of life imprisonment. The appellant argued on appeal that he had been charged with only one count of rape and that the state, if it wanted the sentence of life imprisonment to apply, ought to have charged him with two counts of rape.Held, that the correct way to charge an accused who was accused of raping a victim more than once in the course of a single encounter was to charge the accused with one count of rape. This avoided potential difficulties where each count attracted a potential life sentence, or where the first rape attracted a 10-year minimum sentence while the second attracted a life sentence, or where both counts had to be taken together for purposes of sentence. Held, further, that there was no merit in the argument that the appellant's trial F was unfair because he was found to have penetrated the complainant more than once but had only been charged with one count of rape. Held, further, that the rape was not one continuous course of conduct, as an interruption had occurred when the appellant left the room to go to the toilet. Held, further, that when the personal circumstances of the appellant (namely his G age and that he was a first offender) were taken into consideration, together with the nature and seriousness of the crime and the interests of society, it could not be said that the magistrate had misdirected himself as to sentencing in any respect, and the sentence did not induce a sense of shock. The appeal accordingly had to be dismissed.

S v OKAH 2015 (2) SACR 561 (GJ)

Jurisdiction — High Court — Extraterritorial jurisdiction — Jurisdiction in terms B of Protection of Constitutional Democracy against Terrorist and Related Activities Act 33 of 2004 — Ambit of s 1(4) of Act — Court holding that militant campaign against

Government of Nigeria excluded from ambit of s 1(4) once members of armed struggle had been granted amnesty. 

The accused was charged in the High Court with 13 counts in contravention of the Protection of Constitutional Democracy against Terrorist and Related Activities Act 33 of 2004 (the Act). Counts 1 – 12 arose from two incidents which occurred in March 2010 in Warri and in October 2010 in Abuja, Nigeria. In each instance two car bombs exploded, killing and injuring several people and causing damage to property. In the process certain internationally protected persons were also threatened by the explosions. It was further alleged that the accused provided the finance and the necessary equipment in order for these bomb explosions to take place. Each of the main counts 1 – 12 carried alternative charges of conspiracy to commit such crimes, alternatively to induce and/or incite others to commit such crimes.Counts 1, 3, 5, 7, 9 and 11 related to the bombings which occurred in Warri. Counts 2, 4, 6, 8, 10 and 12 related to the bombings which occurred in Abuja, Nigeria. Count 13 alleged that the accused unlawfully and intentionally threatened certain South African nationals employed in Nigeria with terrorist activities, and to disrupt their businesses, alternatively to take their employees hostage. The accused challenged the jurisdiction of the South African High Court to try him and sought to rely on the provisions of s 1(4) to oust the jurisdiction of the court to try him, and contended that the accused's participation in the struggle against the government of Nigeria was in the exercise of the people's legitimate right of self-determination and freedom from aggression.Held: The state had succeeded in establishing the jurisdiction of this court to hear this matter. The reliance on s 1(4) was misplaced. Subsection 1(4) excluded from the ambit of the Act any armed struggle in the exercise of a people's legitimate right to national liberation, self-determination and independence against colonialism, or occupation or aggression or domination by alien or foreign forces in accordance with the principles of international law. It was common cause that a militant campaign was waged against the Nigerian Government by its own civilians living in the southern states of Nigeria, in protest at the alleged wrongful application of funds derived from oil extraction occurring within the jurisdiction of those southern states. Subsequent to the grant of amnesty by the Government of Nigeria to its civilians who had been engaged in such armed struggle, and subsequent to the accused accepting the terms of such amnesty for himself, no further armed struggle was legitimate. In any event, at no stage prior to amnesty was the struggle directed at the occupation by foreign forces or for the purpose of national liberation or self-determination and independence against colonialism. No basis in fact or in law was placed before the court by the accused to bring himself within the four corners of s 1(4). Counsel's argument in this regard was therefore rejected. 

S v MASOANGANYE AND OTHERS 2015 (2) SACR 577 (NWM)Theft — Sentence — Theft of money held in trust — Accused were Master of High Court, Assistant Master and an attorney — Large sums of money involved in theft over period of one year — Accused abused positions of trust, and severe sentences appropriate. The appellants appealed against their convictions and sentences in the High Court for theft. The first appellant was the Master of the High Court, the second appellant was an attorney and the third appellant was the Assistant Master. All of the thefts

were in respect of amounts stolen from the Guardians Fund. The first appellant was convicted of five counts involving R1,2 million and was sentenced to an effective 10 years' imprisonment. The second appellant was convicted on two counts involving an amount of R294 000 and was sentenced to an effective 6 years' imprisonment. The third appellant was convicted on one count involving R181 000 and was sentenced to an effective 4 years' imprisonment. The court dismissed the appeals in respect of conviction and then considered the appeals against sentence.  Held, that the Master and Assistant Master were high-ranking officials and occupied responsible positions which were also positions of trust. They dealt with the assets of vulnerable people and entities that were in financial distress whose interests had to be protected. They handled matters relating to the liquidation and administration of the estates of deceased persons, the property of minors and persons under curatorship, and of derelict estates. They also dealt with the affairs of persons who were mentally disturbed or who lacked legal capacity, and they were in control of huge sums of money and assets of considerable value. They ought to be people of integrity. Held, further, that the responsibilities of the second appellant, also an officer of the court, were well documented in our jurisprudence and his profession as an honourable one which demanded complete honesty, reliability and integrity from its members. Held, further, that the Master deserved nothing less than 15 years' imprisonment and the other two appellants an effective minimum sentence of 10 years' imprisonment, and the court a quo had been extremely lenient in dealing with the appellants' corrupt activities and maladministration stretching over a period of a year. The appeal against the sentences was dismissed.

S v SEEDAT 2015 (2) SACR 612 (GP)Rape — Sentence — Restorative justice — When applicable — Complainant not seeking imprisonment of accused, rather wanted compensation — Accused willing to compensate — Magistrate erring in not considering option of imposing sentence in terms of s 297 of Criminal Procedure Act 51 of 1977 — Sentence of imprisonment set aside on appeal and replaced with order that sentence postponed for accused to compensate complainant.Appeal — Application for hearing of further evidence — On face of it part of evidence sought to be led was perjured — Evidence in any event speculative and would not have helped to determine whether state had proven its case or not — Application dismissed.

The appellant was a 63-year-old businessman who was convicted in a magistrates' court of rape and was sentenced to seven years' imprisonment. He appealed against the conviction and sentence and also applied for leave to adduce further evidence in terms of s 309B of the Criminal Procedure Act 51 of 1977. The complainant testified at the trial that the appellant delivered a bedside lamp to her residence and after he plugged it in and showed her that it worked, he grabbed her, threw her against the dressing table, pulled off her trousers and panties and then threw her down and penetrated her anally. He then turned her around and had frontal vaginal intercourse with her. The doctor who completed the J88 did not testify and F the form was handed in by consent. The form indicated that there were abrasions to the vagina and inflammation of the anus and there was evidence of dry penetration of her vagina. The further evidence sought to be led by the appellant was that of a doctor

who stated in an affidavit that it was improbable that the 57-year-old complainant would not have had bruising on other parts of her body, given what had happened. This affidavit was G confirmed by another doctor but it appeared that the confirmatory affidavit, which stated specifically that the deponent had seen the first affidavit, was actually deposed to and commissioned before the supposedly first affidavit. As regards sentence, it was contended on behalf of the appellant that the magistrate had erred in not considering a compensatory sentence, in the circumstances where the complainant stated that she did not wish the appellant to go to jail and that she would be satisfied if he bought her a H Toyota motor vehicle and gave her compensation of R240 000, which the appellant was willing to do.Held, as to the application for leave to lead further evidence that the second doctor who made the confirmatory affidavit could not have read the affidavit of the other doctor before it even came into existence, and therefore the conclusion was that he had not told the truth but committed perjury in I alleging that he had read it. His confirmatory affidavit could therefore not be of any assistance to the court, were it to be led as further evidence. Held, further, that the evidence of the doctors proposed to be led could not explain away the clinical findings regarding abrasions to the vagina and the inflammation of the anus, and the doctor did not challenge the finding that J there had been anal penetration. The conclusions in these affidavits were merely speculative and would not contribute towards the resolution of the A important question whether the state had proven its case against the appellant beyond reasonable doubt. There would therefore be no purpose in granting leave to lead further evidence. Held, further, that, on the evidence, the appellant had committed two separate acts of rape and should have been convicted of repeat rape in terms of B s 51(1) of the Criminal Law Amendment Act 105 of 1997. In the circumstances where the state had not applied to have the charge amended and the magistrate, after having heard evidence, had not deemed it necessary to address the issue of repeat penetration and neither during the appeal had the parties been invited to address the court on this aspect, it would be a travesty of justice at such a belated stage to convict the appellant of repeat rape. Held, as to sentence, that the magistrate had not considered applying the provisions of s 297 of the Criminal Procedure Act 51 of 1977 and postponed the sentence for a period on condition that the appellant pay compensation. As the minimum-sentencing provisions of Act 105 of 1997 were not applicable it was open to the magistrate to postpone the imposition of sentence for a period and make a restorative justice award. In the circumstances it was appropriate that the appellant be ordered to compensate the complainant; however, the amount suggested by her was excessive and there was nothing to show how the amount had been arrived at. In the circumstances an award of R100 000 would be appropriate.

S v MARINGA AND ANOTHER 2015 (2) SACR 629 (SCA)Indictment and charge — Joinder of accused — Participants in scheme to commit fraud — Purpose of provisions to avoid multiplicity of trials where number of accused — Evidence that needed to be led would prove existence of grand scheme to defraud municipality, even though some accused were not charged with all counts of fraud — State would suffer prejudice if compelled to have separate trial — Joinder competent — Criminal Procedure Act 51 of 1977, ss 155 and 156.

The two appellants were two of seven accused facing trial in a regional court on a total of 399 charges, including fraud, forgery, uttering and corruption. The first appellant was charged with all the counts, barring those related to the corruption charges, while the second appellant was charged with only 34 counts of fraud. The appellants objected to being tried together with the other accused, on the basis that this was contrary to ss 155 and 156 of the Criminal Procedure Act 51 of 1977, as they did not all face the same charges. The offences were all committed within a period of two months and were therefore committed at about the same time and place, and were in furtherance of a common purpose designed to fraudulently sell property belonging to the Johannesburg Metropolitan Municipality and to transfer those properties to buyers, in order for the accused to collect the proceeds of those sales. In order to successfully effect such transfers it was necessary for officials in Sars and the Deeds Office to cooperate in the furtherance of the common purpose. The officials were bribed and therefore the corruption charges were part and parcel of the overall design of the scheme. There was a whole mosaic of evidence that was necessary to prove the scheme, as well as the participation of the various accused in its different facets. It was contended on behalf of the appellants that they would suffer prejudice by having to sit through the whole trial while evidence would be presented that would not involve the charges which they faced. Held, that the purpose of ss 155 and 156 was to avoid a multiplicity of trials where there were a number of accused and where essentially the same evidence on behalf of the prosecution was led on charges faced by all the accused, and thereby avoid prejudice to both the accused and the prosecution. Held, further, that the prejudice that the appellants would allegedly suffer was exaggerated, in that the corruption and other charges were but a part of the scheme that would be proved. On the other hand, if separation were ordered, the state would suffer prejudice, in that it would have to have three separate trials with the same witnesses who would have to testify about the same facts. This was inimical to the interests of the state, and against the principle that there should not be a multiplicity of trials relating to essentially the same facts and body of evidence. The prejudice asserted by the appellants was, in the greater scheme of things, minimal. The magistrate had exercised his discretion in refusing a separation and there was no indication that such discretion had not been exercised judiciously, and the appeal accordingly had to be dismissed.

S v KOK 2015 (2) SACR 637 (WCC)Sentence — Suspension of — Conditions of suspension — On condition accused repay large amount to state — Magistrate giving accused grace of one year in which to pay, in erroneous belief that debts to state had to be repaid within one year — Requirement unduly onerous — Matter remitted to court for imposition of sentence afresh. 

The accused was convicted in a regional magistrates' court on a charge of having stolen in excess of R98 000 from the state and was sentenced to a term of imprisonment that was suspended on condition that he repay the amount within a period of one year. He failed to pay as stipulated and he was then arrested and started serving his sentence. He applied for leave to appeal and contended that, in imposing sentence, the magistrate had erroneously taken the view that, in terms of the Public Finance Management Act 1 of 1999, it was required that all debts to the

state had to be repaid within 12 months, and accordingly made this stipulation. The matter came before the court by way of special review.Held, that, as it appeared that there was no such legal requirement as referred to by the magistrate, the magistrate had clearly misdirected himself by relying on such a provision to limit the period of repayment of the amount owed by the accused. As a result of this, the condition of suspension, that he pay off the amount owed to the state in one year, was unduly onerous and it was not reasonably possible for the accused to comply with this condition of suspension. As a result of this the sentence imposed, as well as the F subsequent putting into operation of the sentence, fell to be set aside. The matter was remitted to the regional court for sentence to be considered afresh before another regional magistrate in terms of the provisions of s 275 of the Criminal Procedure Act 51 of 1977.

ALL SA LAW REPORTS DECEMBER 2015

VOLUME ONE

Brouze and others v Wenneni Investments (Pty) Ltd and another[2015] 4 All SA 543 (SCA)

 Delict – Claim for damages – Alleged fraudulent misrepresentation and non-disclosure – No actionable misrepresentations established on evidence – Non-disclosure claim being a delictual one relating to omission – Omission or non-disclosure had to be shown to have been wrongful – General test in delict for omissions is that in each case the court looks to the legal convictions of the community.

Evidence – Assessment of – Where both parties not good witnesses, court must have regard to probabilities.

The second respondent (“Jedeikin”) was the owner of the first respondent (“Wenneni”). He conceived of the idea of bringing two international fashion brands to South Africa. One of the brands (“Mango”) expressed interest in the proposal, and the second respondent realised that he did not have the experience or ability to pursue his goals without the assistance of an experienced retailer. He was introduced to the first appellant (“Brouze”), who was the chief executive officer of a leading South African retailer (“House of Busby”). The two decided to form a joint venture in order to bring the Mango brand to South Africa. The vehicle used to acquire the Mango licence in South Africa was a company (“Golden Pond”) formed by the joint venture. When Mango advised Jedeikin that the Mango label had been awarded to Wenneni, Jedeikin informed Brouze thereof. Brouze sent a draft memorandum of understanding between Busby and Wenneni to Jedeikin, indicating that Busby would have a shareholding in Golden Pond of 51%, and Wenneni would have 49%. Wenneni and a subsidiary of House of Busby entered into a shareholders’ agreement that gave Busby sole management control of any Mango store to be opened in South Africa. Jedeikin was appointed as a brand ambassador for Mango fashions, and was paid to work three days a week for Golden Pond. However, Jedeikin was not happy with what he perceived as his being side-lined, and the relationship between him and House of Busby soured.

Jedeikin did not abandon his efforts to woo the other fashion brand (“Zara”) which he had earmarked for bringing to South Africa. He continued to try to persuade the Zara brand owner to open stores in South Africa, and pressed Busby to find retail space for Zara stores. Brouze made it clear that Busby was not interested in Zara at that stage. However, in November 2006, Brouze had made independent contact with the Zara owner, and had stated that Busby was happy to welcome the brand to South Africa and to act as partner in launching the brand, but stressed that should Busby be selected as the partner through which to launch the Zara brand in South Africa, the partnership would consist of Zara and Busby and no joint venture or third parties would be involved. In February 2007 the first, and only, board meeting of Golden Pond was convened.

At the meeting, Jedeikin announced that the Zara brand launch was going to happen, and that Busby was to decide whether it wanted to be part of that or not. That announcement led Brouze to call the Zara brand owner to establish the truth of Jedeikin’s assertions. In that call, Brouze agreed to explore the possibility of partnering with the Zara brand owner. The person with whom Brouze spoke, later told Jedeikin about the call. Jedeikin was infuriated at what he saw as Brouze going behind his back. He later revealed in a newspaper interview, that the expansion of the Mango brand in South Africa would see it competing in the same space as two local fashion retailers. That angered Brouze as the two local retailers were large customers of Busby, who were upset by Jedeikin’s assertion.

As the Mango brand did not fare as well as hoped locally, it was decided that a second store had to be opened to boost sales. That required a cash injection by Busby and Wenneni. Jedeikin was at the same time, called upon by an investor, to repay a loan granted to him. Faced with those financial demands, Jedeikin negotiated his exit from Golden Pond.

The exit agreement, according to Jedeikin, was induced by the threat of liquidation which would entail Wenneni losing its investment. However, Jedeikin then sued the appellants for damages in the High Court, based on alleged fraudulent misrepresentations and non-disclosure in the procuring of the exit agreement. The alleged misrepresentations were that, prior to the agreement, Busby had told Jedeikin that Golden Pond was in a perilous financial situation; that Brouze had said that the company was insolvent; and that he said that Busby would liquidate Golden Pond and they would all lose their investments. The alleged non-disclosure was that Jedeikin was not told of a proposed takeover of Golden Pond by another entity. The trial court found for the respondents, leading to the present appeal.

Held – Brouze was a poor witness. He was obstructive and evasive in his testimony. Jedeikin was an equally poor witness, described in the judgment as arrogant, unmannered, ill-disciplined and evasive. Given that both Jedeikin and Brouze were not good witnesses, the Court had to have regard to the probabilities. The Court found that Jedeikin was not induced to enter into the exit agreement by the threat of liquidation. The Court found that there were no actionable misrepresentations made by any of the appellants to Jedeikin.

Turning to the non-disclosure of the impending takeover of Golden Pond, the Court held that the claim in that regard being a delictual one for damages, the omission or non-disclosure had to be shown to have been wrongful. It had to be shown that the appellants had a duty to tell Jedeikin about the takeover negotiations. The test for

determining wrongfulness in a pre-contractual setting is the same as the general test in delict for omissions: in each case the court looks to the legal convictions of the community.

At the time when the exit contract was entered into, there was no transaction to disclose. The preliminary talks about a sale of shares in the House of Busby were not such as to require any disclosure to a shareholder in a subsidiary, such as Jedeikin was.

The appeal was, accordingly, upheld.

Centre for Child Law v Governing Body of Hoërskool Fochville and another[2015] 4 All SA 571 (SCA)

Appeal – Mootness – Section 16(2)(a)(i) of the Superior Courts Act 10 of 2013 allows an appeal court to dismiss an appeal where the issues are of such a nature that the decision sought will have no practical effect or result – Court having discretion, and will generally entertain appeal where there is a discrete legal issue of public importance that would affect matters in the future and on which the adjudication of the court was required.

Civil procedure – Discovery – Uniform Rules of Court – Rule 35(12) – Application to compel production of documents – Where interests of children are involved, and such interests could be negatively affected, it was not appropriate for lower court to order disclosure of documents.

In December 2011, the respondents approached the High Court for an urgent interim order interdicting the relevant authorities from admitting, or directing the principal of the second respondent to admit, any additional learners for the 2012 academic year. An order was also sought reviewing and setting aside the admission by the authorities of any additional learners where such admission would result in the total number of learners admitted exceeding the capacity of the School as determined in its admission policy. The urgent application failed, and the additional learners were enrolled in 2012.

At the end of 2012, the authorities launched a counter-application seeking to change the school’s language policy from Afrikaans medium to dual medium. A few days later, the appellant applied for leave to intervene as the third applicant in the main application. The appellant was an organisation aimed at promoting child law and upholding the rights of children. In support of its intervention application, it stated that it had met with the children, who were keen to be represented, and to have their views heard. The appellant gave each of the children a questionnaire to complete.

Opposing the appellant’s application to intervene, the school served a notice in terms of Uniform Rule 35(12) requiring the appellant to produce for inspection, the questionnaires referred to above. The appellant refused to comply, stating that the questionnaires were privileged documents and were confidential. That led to the school applying for an order compelling the appellant to comply with the rule 35(12) notice. The application succeeded, although the appellant obtained leave to appeal to the present Court. By then, however, a settlement agreement had been concluded between the parties to the litigation in the main application. In terms thereof, the authorities had undertaken to construct a new English-medium school in the area,

and save for one learner, all the additional learners would be allowed to complete their education at the second respondent school.

Although, in granting leave to appeal, the court was aware that the settlement agreement had rendered the rule 35(12) application moot, the court was persuaded that there was a live issue that justified the granting of leave to appeal.

Held – The Court was required to decide whether the appeal should be entertained at all. To that end, Counsel were requested to present argument as to whether it was not appropriate to deal with the matter in terms of section 16(2)(a)(i) of the Superior Courts Act 10 of 2013 (the “Act”), according to which this Court may dismiss an appeal where the issues are of such a nature that the decision sought will have no practical effect or result. Courts should and ought not to decide issues purely for academic interest. The court has a discretion in that regard, and there are a number of cases where, notwithstanding the mootness of the issue as between the parties to the litigation, it has dealt with the merits of an appeal. In those instances, there has been a discrete legal issue of public importance that would affect matters in the future and on which the adjudication of the court was required.

The Court held that it has a general discretion in terms of which it is required to try to strike a balance between the conflicting interests of the parties in the case. Implicit in that is that it should not fetter its own discretion in any manner and particularly not by adopting a predisposition either in favour of or against granting production. And, in the exercise of that discretion, a court will not make an order against a party to produce a document that cannot be produced or is privileged or irrelevant. In striking the appropriate balance in a case of this nature adequate weight must be accorded to the interests of the children. The Court recognised the right of children to participate in all matters that affect them. Article 12 of the United Nations Convention on the Rights of the Child, 1989 (“UNCRC”) entrenches the child’s right to participate. The provisions of the Children’s Act 38 of 2005 echo that. Moreover, the right of children to be legally represented in civil matters was included in the Constitution. Accordingly, in every weighing of rights and interests and any value judgment relating to whether the questionnaires should be produced, the best interests of the children would have to be the paramount consideration. Thus even if the questionnaires were not protected by privilege or if the privilege had been waived, it may not have been appropriate for the court a quo to have ordered their disclosure on the basis that it would not have been in the children’s best interests to do so.

On the ground that the school had failed to show why their interests should outweigh those of the children, the Court upheld the appeal.

Member of the Executive Council for Education, Gauteng and another v Federation of Governing Bodies for South African Schools[2015] 4 All SA 591 (SCA)

Education – Regulations governing admission of learners to public schools – Validity of – Section 5(5) of the South African Schools Act 84 of 1996must be read with other applicable law – Education department exercises ultimate control – Powers of the department to be exercised reasonably – Principle of co-operative governance paramount and parties must engage with each other in good faith.

On 18 July 2011, the first appellant, the Member of the Executive Council for Education, Gauteng (“MEC”) published proposed amendments to regulations relating to admission of learners to public schools in Gauteng. Pursuant to an invitation for comments the respondent (“Fedsas”) submitted comments to the Gauteng Department of Education (“GDE”). Some of its suggestions were given effect to, but not all. It therefore challenged the amendments in the High Court. it contended that the amended regulations were in conflict with the provisions of section 5(5) of the South African Schools Act 84 of 1996 (the “Schools Act”), the National Education Policy Act 27 of 1996 (“NEPA”), the Admission Policy for Ordinary Public Schools (as published by the Minister of Education in terms of section   3(4)(i)   of NEPA in GN 2432, GG 19377 of 19 October 1998), the Gauteng Education Policy Act 12 of 1998  (“GEPA”), and the Gauteng School Education Act 6 of 1995 (“GSEA”).

Fedsas argued that the regulations were ultra vires the enabling legislation in terms of which they were promulgated, namely, the provisions of section 11(1) of the GSEA, and that they were unconstitutionally promulgated in contravention of the provisions of section 3 of the Promotion of Administrative Justice Act 3 of 2000 (“PAJA”) and section 33 of the Constitution in that they were not enacted in a procedurally fair manner. It was also contended that they violated the principle of legality and rationality.

The High Court struck down the regulations, mainly on the basis that they were in conflict with national legislation and were ultra vires the enabling provincial legislation. The court found that they encroached on the autonomy of governing bodies. It also found that some of the regulations were adopted in a procedurally unfair manner, and that others were not reasonable and justifiable.

On appeal, the appellants argued that any differences or overlap that might exist between the regulations and the national and provincial legislation in question did not constitute a conflict, and did not render the regulations invalid.

Cardinal to Fedsas’ argument was that section 5(5) of the Schools Act places the power to determine the admission policy of a school in the hands of governing bodies of schools. It contended that where the regulations in question relate to matters already provided for in national or provincial legislation, the overlap constituted a conflict.

Held – The issues raised in this appeal arose against a history of a sustained power struggle between provincial education departments and school governing bodies over governance and management of public schools in this country. The Schools Act was enacted in the spirit of transformation of the public school education system. It provides, inter alia, for a power sharing arrangement between the State, parents and educators. This collaborative administration system was intended to enhance access to decent basic education for all learners. The Court referred to the need for participants in school governance to engage with each other in good faith to uphold the principles of co-operative governance and to comply with their duty to act in the interests of learners. The enduring disparities in the education system which are a legacy of the apartheid system were common knowledge and have been repeatedly acknowledged by our courts. The need for sustained reform in our public education system was firmly established. Fedsas’ arguments ignored the above facts.

The Court found only one of the impugned regulations to be reviewable. Regulation 2(2A) empowered the Department to determine the minimum standards for the formulation of the admission policy for specialist schools, technical schools and education institutions. The intention in promulgating this regulation was to create a special dispensation for special schools and technical schools, separate from that applicable to other public schools. However, the Court found the regulation to be unclear. All laws, including delegated legislation, must be clear, comprehensible, accessible and predictable in their application, failing which they are open to review by the courts. The regulation in question not meeting those requirements, was struck down.

The appeal was upheld to that limited extent.

Naidoo v Minister of Police and others [2015] 4 All SA 609 (SCA)

Delict – Claim for damages – Unlawful arrest – Appellant a victim of domestic violence assaulted by police while seeking assistance from them – Section 40(1)(q) of the Criminal Procedure Act 51 of 1977 allows a peace officer to arrest any person who is reasonably suspected of having committed an act of domestic violence as contemplated in section 1 of the Domestic Violence Act 116 of 1998 – Where arresting officer exercised his discretion to arrest the appellant arbitrarily or for an improper purpose, damages awarded.

Delict – Police negligence – Failure to handle domestic violence incident as prescribed in section 2 of Domestic Violence Act 116 of 1998 – Test for negligence – Whether a diligens paterfamilias in the position of the person concerned would foresee the reasonable possibility of his conduct injuring another in his person or property and causing him patrimonial loss; and would take reasonable steps to guard against such occurrence; and the defendant failed to take such steps.

Two days after an incident of domestic abuse, the appellant went to her local police station to report the assault and lay a criminal charge of domestic violence against her husband. She was informed that before she could lay a charge of domestic violence it was necessary for her to first apply for and obtain a protection order under the Domestic Violence Act 116 of 1998 in a Magistrates’ Court. She then went to the court as advised, but was told that a protection order was not a prerequisite for her to lay a criminal charge under the Act. She was also told that she could, if so inclined, apply for a protection order once she had laid a charge. Returning to the police station, the appellant restated her wish to lay a charge against her husband. The second respondent eventually dealt with her. He asked the appellant’s husband to report to the police station, and then told the appellant that if she was intent on pursuing the charge against her husband, the latter would similarly lay a charge against her and if that were to happen she would also be liable to be arrested. After both parties wrote their respective statements, they were both arrested, charged and detained in separate police cells at the police station.

The following morning, another police officer (now deceased) informed the appellant in her police cell that he was to take her to court. She requested a moment in order to speak to the fourth respondent, but the police officer refused and forcibly flung her into the rear of the police van. As a result of his actions, the appellant suffered pain and swelling in the right side of her body. In court, the charge against her was withdrawn.

The appellant instituted a delictual action in the High Court, against the Minister of Police (the “Minister”) and certain members of the South African Police Service (“SAPS”) for damages. She claimed that members of the SAPS had wrongfully and negligently failed to comply with the legal duties they owed to her in terms of the Domestic Violence Act, the Regulations and National Instructions issued in terms of the Act; that they were guilty of unlawful arrest and detention and assault; that they had breached the constitutional duty owed to her by them; and that they breached a statutory duty in consequence of which she again allegedly became a victim of domestic violence.

The trial court dismissed the appellant’s action with costs.

Held – Acts causing physical and emotional harm to a plaintiff are wrongful. The claims made by the appellant were based on a series of acts and breaches of statutory duty.

Section 2 of the Act requires the police when faced with an incident of domestic violence, to assist and inform the complainant of her rights. In this case, the police failed to comply with that obligation by giving the appellant incorrect advice, encouraging her husband to bring a counter-charge, and then arresting the appellant. As some of that conduct on the part of the police was deliberate, and some not, the Court turned to consider whether the police were negligent. The test for negligence is whether a diligens paterfamilias in the position of the person concerned would foresee the reasonable possibility of his conduct injuring another in his person or property and causing him patrimonial loss; and would take reasonable steps to guard against such occurrence; and the defendant failed to take such steps. Whether the precautions taken to guard against foreseeable harm were reasonable or not is a factual one. Accordingly, the question was whether in the light of the peculiar facts of this case the conduct of the police fell short of the conduct of the notional reasonable person. The Court was satisfied that what the appellant experienced at the hands of members of SAPS constituted a breach of the legal duty that those members owed to her. The first claim was thus upheld.

The appellant’s second cause of action was that her arrest and detention were unlawful. The Minister resisted the claim and invoked section 40(1)(b) and (q) of the Criminal Procedure Act 51 of 1977 to justify the arrest. Section 40(1)(q) allows a peace officer to arrest any person who is reasonably suspected of having committed an act of domestic violence as contemplated in section 1 of the Domestic Violence Act, which constitutes an offence of which violence is an element. The purpose of the arrest is to bring the arrestee before the court for the court to determine whether the arrestee ought to be detained further, for example, pending further investigations or trial. Also relevant is the fact that section 12(1)(a) of the Constitution prevents the arbitrary deprivation of liberty. The arresting officer in this matter exercised his discretion to arrest the appellant arbitrarily or for an improper purpose. The second claim was also upheld.

The court a quo had held that the appellant was not entitled to succeed with her claim for assault as the member of the SAPS responsible for the assault had passed away by the time that the matter had come to trial, and the appellant had failed to join his estate. The present Court rejected that view, and upheld the third claim as well.

The appeal was upheld.

Non-Detonating Solutions (Pty) Ltd v Durie and another [2015] 4 All SA 630 (SCA)

Civil procedure – Anton Piller order – Validity of – Requirements for grant of order – In exercising its discretion whether or not to grant an Anton Piller order, the court must pay regard to, inter alia, the cogency of the prima facie case established, the potential harm that will be suffered by the respondent if the remedy is granted as compared with, or balanced against the potential harm to the applicant if the remedy is withheld.

At the instance of the appellant, an Anton Piller order was granted ex parte against the respondents. The validity of that order was at the centre of the present appeal.

The appellant and second respondent were competitors in the field of propellant or gas filled rock breaking cartridges, mainly used for underground mining. The first respondent was the managing director of the second respondent. The appellant came to own the copyright in the design and manufacturing drawings for a specific type of cartridge (“the AutoStem”) which would have significant cost and time-saving benefits. The appellant intended to market, sell and distribute the AutoStem, and approached certain toolmakers to provide quotations for the manufacture of the AutoStem. The Anton Piller application was triggered after the appellant was informed by attorneys of one of the toolmakers approached, that the second respondent had presented drawings and designs representing a cartridge similar to the AutoStem and had requested the toolmaker (“Valmar”) to manufacture that cartridge for it.

In its urgent ex parte application, the appellant sought an Anton Piller order against the respondents for the preservation of evidence and articles relating to the infringement of its rights. The order granted essentially permitted the sheriff and deputy sheriff, a supervising attorney and two independent information technology specialists to enter the first respondent’s residence for the purpose of searching and seizing documents and articles specified in the order, and computer equipment or other information storage devices. However, on the return date, the judge discharged the interim Anton Piller order on the grounds, inter alia, that the order was over-broad and stretched beyond what was reasonable and lawful, and that its terms relating to the forensic enquiry were too wide and should have been limited to documents and items produced after a specified period only and not before a particular date. This appeal was against those findings.

Held – The purpose of Anton Piller orders is to preserve evidence to be used in a forthcoming dispute. Such evidence must constitute vital evidence in substantiation of the applicant’s cause of action. In exercising its discretion whether or not to grant an Anton Piller order, the court must pay regard to, inter alia, the cogency of the prima facie case established, the potential harm that will be suffered by the respondent if the remedy is granted as compared with, or balanced against the potential harm to the applicant if the remedy is withheld. The requirement of a prima facie cause of action is simply that an applicant should show no more than that there is evidence which, if accepted, will establish a cause of action. The Court was satisfied that the court a quo was correct in finding that the appellant had established a prima facie cause of action against the respondents.

The Anton Piller order is made where a reasonable fear exists that the respondent might in the normal course not discharge its duty to make full discovery. The establishment of an element of dishonesty in the conduct of a respondent must ordinarily give rise to a fear that vital evidence might be concealed or that the respondent might not make full discovery. The court a quo correctly held that there was a real and well-founded apprehension that crucial or vital evidence, particularly relating to the drawing made by the first respondent and the respondents’ instructions and correspondence with the toolmakers, might be hidden, destroyed or spirited away by the time the case came to trial.

The issue whether or not the Anton Piller order was overly broad and stretched beyond what was reasonable and lawful and therefore not competent, became the main focus of the appeal. In finding that the search should have been limited to documents specified in the founding affidavit, the court below adopted a too restrictive approach to the terms of the order. The requirement that the applicant must show, prima facie, that the respondent has in his possession specific (and specified) documents that constitute vital evidence in substantiation of the applicant’s cause of action, does not mean that only individual documents identified by, for example, date or origin, are properly liable to be attached. Thus, the court a quo erred when it discharged the interim order on the return day.

The appeal was upheld.

Barnard v Minister of Justice, Constitutional Development and Correctional Services and another [2015] 4 All SA 648 (GP)

Administrative law – Correctional services – Refusal of parole – Application for review – Section 6(2)(h) of the Promotion of Administrative Justice Act 3 of 2000 provides that administrative action will be reviewable if the relevant exercise of power is so unreasonable that no reasonable person could have exercised the power – Courts are guided by various factors, inter alia, nature of the decision, identity and expertise of the decision-maker and the nature of competing interests – In casu, the Court concluded that the Minister took into account both positive and negative factors in deciding not to approve the applicant’s parole.

Administrative law – Correctional services – Refusal of parole – Application for review – Whether the Minister exercised his powers lawfully in denying the applicant parole – Allegation of mala fides – Section 6(2)(e)(v) of Promotion of Administrative Justice Act 3 of 2000 stipulates that a decision taken in bad faith is reviewable – Should an applicant claim mala fides, he must provide cogent reasons for such bad faith.

The applicant sought the review of the decision of the first respondent (“the Minister”) to refuse his application for release on parole. The applicant was serving two life sentences for two counts of murder. One of the counts related to the murder of the well-known anti-apartheid activist, David Webster. Thus, the tone of the main contentions of the applicant was that the Minister’s decision to refuse parole was unlawfully based on political grounds. The applicant requested the court to grant an order of substitution in terms of section 8(2) of the Promotion of Administrative Justice Act3 of 2000 (“PAJA”) to be placed on parole with immediate effect.

Held – The crux of the matter was whether the Minister exercised his powers lawfully in denying the applicant parole.

The Court examined the guidelines relating to the granting of parole, more specifically the nature of the crime, the offender’s history, the offender’s behaviour and progress made during his incarceration as well as his domestic circumstances and employment opportunities.

The main grounds of review were summarised as relating to an allegation of mala fides on the part of the Minister, and unreasonableness of his decision. Section 6(2)(e)(v) of PAJA stipulates that a decision taken in bad faith is reviewable. The Court concluded that the Minister took into account the criteria and principles outlined in the parole policy and the parole manual. Should an applicant claim mala fides, he must provide cogent reasons for such bad faith. In casu, the applicant’s case for bad faith is substantially inferential and is based on the Minister’s alleged political bias against him. As a result, the Court was not satisfied that any bad faith could be imputed to the Minister as he was found to have taken into account factors which he was entitled to.

The Court confirmed that considerations of restorative justice form an inherent component of any parole process Victim/offender dialogue processes and attempts to reach out to the victim’s family members are components of an offender’s rehabilitation. The Minister was not acting in bad faith when he identified certain areas of improvement for the offender should he wish to strengthen his future prospects of parole.

Section 6(2)(h) of PAJA provides that administrative action will be reviewable if the relevant exercise of power is so unreasonable that no reasonable person could have exercised the power. When considering the reasonableness of a decision, courts are guided by various factors, inter alia, nature of the decision, identity and expertise of the decision-maker and the nature of competing interests. In casu, the Court concluded that the Minister took into account both positive and negative factors in deciding not to approve the applicant’s parole. It was held that the decision could not be said to be unreasonable in any way.

The application for review was dismissed.

Bosch Munitech (Pty) Ltd v Govan Mbeki Municipality [2015] 4 All SA 674 (GP)

Contract – Existence of – Acceptance of offer – Issue was whether the formalities for the acceptance of the applicant’s offer were complied with in a manner resulting in the conclusion of a contract in accordance with the provisions of the tender process and documents – Where a contract is not concluded between the parties because of non-compliance with the prescribed mode of acceptance, no contractual viriculum juris exists and the parties may not assert the contractual remedies available under the flawed agreement – Court held that performance rendered in terms of a formally defective agreement is recoverable by means of an enrichment action and not by contractual remedies.

In April 2013, the respondent invited tenders for the refurbishment of certain waterworks. The applicant submitted its tender to the respondent on 3 May 2013. While it was common cause that the applicant tendered to do the work, the issue in dispute was whether a contract was settled at the time on the terms alleged by the applicant.

Relying on the contract allegedly entered into between it and the respondent, the applicant claimed payment of R16 996 144,69. The respondent however, disputed that it entered into a written agreement with the applicant, entitling the latter to payment. According to the respondent, the applicant relied on the terms and conditions of an agreement not concluded with the requisite animus contrahendi or in accordance with its stipulated formalities.

Held – The ultimate question was whether the formalities for the acceptance of the applicant’s offer were complied with in a manner resulting in the conclusion of a contract in accordance with the provisions of the tender process and documents. Where the mode of acceptance in a proposed contract is stipulated, it is that mode that must be followed before a contract is concluded. Non-compliance with formalities imposed by one of the parties results in the nullity of the contract. Where a contract is not concluded between the parties because of non-compliance with the prescribed mode of acceptance, no contractual viriculum juris exists and the parties may not assert the contractual remedies available under the flawed agreement, as the applicant sought to do in the present case. Performance rendered in terms of a formally defective agreement is regarded as having been made without legal ground and such performance is recoverable by means of an enrichment action and not by contractual remedies.

In the premises, the respondent was granted absolution from the instance.

Dalindyebo v S [2015] 4 All SA 689 (SCA)

Criminal law – Arson – Whether crime of arson can be committed when a person sets fire to his own immovable property – A person may be guilty of arson if he sets fire to his own immovable property with the intent to injure another.

Criminal law – Right to fair trial – Includes right to have trial begin and conclude without unreasonable delay – Where delays were caused by appellant’s own dilatory and obstructive behaviour, objection that trial was rendered unfair was dismissed.

Criminal procedure – Appeal in respect of severity of sentence – Complaint concerning inadequacy of legal representation rejected – Accusation that trial judge acted irregularly by descending into the arena calling into question his impartiality unfounded.

The appellant was the Paramount Chief of the AbaThembu tribe in the Eastern Cape. The State’s case against him was that he had set fire to dwellings that housed the three complainants, who were his “subjects” and tenants, to secure their eviction when he considered that they had breached tribal rules. He was also alleged to have publicly assaulted three young men so brutally that some of the people present could not bear to continue to watch and had it not been for later medical intervention they might have died. The assaults were perpetrated, so the State contended, as punishment, without a trial, for criminal acts allegedly committed by the young men in question, being, inter alia, housebreaking and rape. Arising from the above, the appellant was charged and convicted of arson, kidnapping, defeating the ends of justice by unduly influencing a complainant to withdraw the arson charges, assault and culpable homicide. The sentence imposed on the various counts resulted in an effective term of 15 years’ imprisonment.

Both conviction and sentence were appealed against. Although, at the instance of the State, the questions of law were reserved by the court below, that was not persisted with on appeal.

The appellant challenged his convictions on the basis that his trial was unfair. He contended that because his trial had commenced approximately 8 years after the events on which his convictions were based, he was hindered in his ability to adduce and challenge evidence, which was in violation of his constitutional right to a speedy trial in terms of section 35(3) of the Constitution. Another challenge to the fairness of the trial was that the legal representatives that appeared on the appellant’s behalf failed to represent him competently and effectively. The appellant also accused the judge in the court below of unjustifiably descending into the arena with persistent questioning that amounted to repeated irregularities vitiating the trial.

Furthermore, the appellant challenged the merits of his conviction. In relation to his convictions on the charges of arson, his principal defence was that the two houses he had admitted to setting on fire were his property and he could therefore not rightly have been convicted of arson. In respect of the sentences, the appellant’s case was that they were shockingly severe.

Held – Our Constitution dictates that criminal trials should begin and conclude without unreasonable delay. In this case, it was true that years had passed between the commission of the alleged offences and the commencement of the appellant’s trial. Much, if not all of that delay was caused by the appellant being obstructive and employing dubious means to thwart the administration of justice, including the intimidation of complainants. Pressure had to be brought to bear by the community for the prosecution to be reinstated. The appellant’s dilatory and obstructive behaviour continued after the commencement of his trial. The Court concluded that the delay in the appellant’s prosecution was caused largely by his own bad behaviour. The Court also rejected the allegations that the legal representation of the appellant was inadequate.

The next question addressed was whether the judge in the court below breached any of the canons of good judicial behaviour. The record satisfied the Court that the judge’s interventions were not tainted by any impropriety.

On the merits, the Court began by describing the deplorable nature of the appellant’s conduct. The first question addressed was to consider whether the crime of arson can be committed when a person sets fire to his own immovable property. A primary problem for the appellant was that whilst the farm was registered in his name, the restrictions contained in the title deed were significant. The restrictions showed that the land was held by the appellant as hereditary monarch for the benefit of his tribe and subjects. Therefore, it could not be said that the property was his to set to fire to at will. In any event, the Court held that arson can be committed where a person sets fire to his own immovable property with the intention to injure another person.

The Court aligned itself with the findings of the trial court in all respects other than the conviction on the charge of culpable homicide. The evidence linking the appellant to the killing of a young man had not been proved beyond a reasonable doubt. Other than for the setting aside of the conviction and related portion of the sentence in that regard, the appeal was dismissed.

South African Broadcasting Corporation Soc Ltd and others v Democratic Alliance and others (Corruption Watch as amicus curiae) [2015] 4 All SA 719 (SCA)

Constitutional law – Public Protector – Constitutional and legislative scheme regulating powers of Public Protector – Order suspending Chief Operating Officer of the South African Broadcasting Corporation – Whether findings of the Public Protector are binding and enforceable – Any affected person or institution aggrieved by a finding, decision or action taken by the Public Protector might, in appropriate circumstances, challenge that by way of a review application, but absent a review application, such person is not entitled to simply ignore the findings.

The first appellant (“SABC”) was the national public broadcaster in South Africa, and the second appellant was the Minister of Communications. In terms of section 8A(2) of the Broadcasting Act 4 of 1999, the State was the sole shareholder in the SABC.

Between November 2011 and February 2012 the seventh respondent (“the Public Protector”) received complaints from three former employees of the SABC, regarding the alleged irregular appointment of the third appellant as Acting Chief Operations Officer, as well as systemic maladministration. The Public Protector released a report relating to her investigation concluding that there were “pathological corporate governance deficiencies at the SABC” and that the third appellant had been allowed by successive boards to operate above the law. The report set out remedial action to be taken by the appellants. Instead of implementing the Public Protector’s remedial action and without notice to her, the SABC board resolved that the third appellant be appointed the permanent COO of the SABC.

Aggrieved, the first respondent, the Democratic Alliance (“DA”), the official opposition political party in the National Assembly, applied to the High Court to first suspend and then set aside the third appellant’s appointment. The court granted the relief sought in the first part of the application, viz for the suspension of the third appellant and the institution of disciplinary proceedings against him.

The court below formulated the primary question for adjudication as being whether the findings of the Public Protector are binding and enforceable, and concluded that they were not. However, the relief was granted on the basis that the appellants had not established grounds for rejecting the Public Protector’s report.

That led to the present appeal.

Held – The starting point had to be the contextualising of the position and purpose of the Public Protector within our constitutional framework, and to consider her powers. The Court held that the office of the Public Protector, like all Chapter Nine institutions, is a venerable one. Our constitutional compact demands that remedial action taken by the Public Protector should not be ignored. State institutions are obliged to heed the principles of co-operative governance as prescribed by section 41 of the Constitution. Any affected person or institution aggrieved by a finding, decision or action taken by the Public Protector might, in appropriate circumstances, challenge that by way of a review application. Absent a review application, however, such person is not entitled to simply ignore the findings, decision or remedial action taken by the Public Protector. Moreover, an individual or body affected by any finding, decision or remedial action taken by the Public Protector is not entitled to

embark on a parallel investigation process to that of the Public Protector, and adopt the position that the outcome of that parallel process trumps the findings, decision or remedial action taken by the Public Protector.

The Court confirmed the correctness of the order directing the SABC to institute disciplinary proceedings against the third appellant and secondly, in ordering that he be suspended pending finalisation of such proceedings. The appeal was dismissed.

Commissioner for the South African Revenue Service v Sassin and others[2015] 4 All SA 756 (KZD)

Motion proceedings – Disputes of fact – Applicant sought to hold the first respondent liable as a co-wrongdoer in a fraudulent scheme – Issue was whether the first respondent could be held liable and to what extent – Motion proceedings cannot be used to resolve factual issues because they are not designed to determine probabilities – Court held that it is unwise to decide a disputed issue of whether fraud was committed on motion proceedings without the benefits inherent in the hearing of oral evidence.

Tax fraud committed against the respondent led to the present proceedings. The perpetrator of the fraud was insolvent, and there was no hope of the applicant recovering any amount from him. In the present motion proceedings, the applicant sought to hold the first respondent liable as a co-wrongdoer for the total amount of the damage caused to the applicant as a result of the fraudulent scheme perpetrated against it on the basis that first respondent was party to the scheme. The claims against the other respondents were for certain specified amounts paid to them by the first respondent allegedly from the ill-gotten gains received by him from the main perpetrator (“Badenhorst”) as a consequence of the fraud.

Held – The main issue to be determined was whether, from all the available evidence, the first respondent could be held liable and to what extent.

Motion proceedings, unless concerned with interim relief, are all about the resolution of legal issues based on common cause facts. Unless the circumstances are special they cannot be used to resolve factual issues because they are not designed to determine probabilities. The Court found that the dispute raised by the first respondent regarding his knowledge of the fraudulent VAT scheme conducted by Badenhorst could not be rejected on the papers as being far-fetched and clearly untenable. A genuine factual dispute arose on the papers, which dispute could not be resolved without resort to viva voce evidence.

Furthermore, motion proceedings are by their very nature generally inappropriate for the purpose of making findings of fraud. It is unwise to decide a disputed issue of whether fraud was committed on motion proceedings without the benefits inherent in the hearing of oral evidence.

The Court ordered the parties to trial, with certain conditions attached.

DA Ungaro & Sons (Pty) Ltd v ABSA Bank Ltd [2015] 4 All SA 783 (GJ)

Banking law – Contract with account holder – Breach of duty by bank – Negligence and breach of agreement in regard to opening of account and operation thereof – Award of damages.

Banking law – Relationship between banker and customer – Relationship based on mandate – Duties of bank towards customer – Bank had no safeguards in place with the plaintiff’s account – Credible evidence presented by the plaintiff proved convincingly that the bank failed in its obligations.

The plaintiff held an account with the defendant bank. The application form was completed and signed by the plaintiff’s financial manager. The latter made unauthorised withdrawals from the account, leading to plaintiff’s action against the defendant, based on the bank’s negligence.

Held – The issues for determination were whether the opening of the account on behalf of the plaintiff resulted in the conclusion of an agreement between the plaintiff and the defendant; and if it did, whether it was a term of the agreement, express or tacit, that the defendant agreed to make payments out of the plaintiff’s account only on the instructions authorised by the plaintiff. It also had to be established whether the defendant and its officials acted negligently in dealing with and handling the account.

The Court confirmed that the relationship between a banker and its client is based on a mandate. Therefore, the opening of the plaintiff’s account did lead to the conclusion of an agreement.

The defendant should not have allowed any withdrawals or transfers out of the account without the requisite signature of an authorised person of the plaintiff. The bank had no safeguards in place with the plaintiff’s account. The credible evidence presented by the plaintiff proved convincingly that the defendant failed in its obligations and breached the agreement. The Court set out the numerous steps which a reasonable banker would have done in the circumstances, but which the defendant failed to do. The conclusion was that the defendant acted negligently in regard to the plaintiff’s account. That negligence was the direct cause of the plaintiff’s loss as pleaded. The defendant was therefore ordered to pay to the plaintiff the sum of R2 680 928,74.

Friedrich and others v Smit NO and others [2015] 4 All SA 805 (GP)

Administration of estates – Claim for maintenance against deceased estate – Maintenance of Surviving Spouses Act 27 of 1990 – Section 2 – Section provides that if a marriage is dissolved by death the survivor shall have a claim against the estate of the deceased spouse for the provision of her reasonable maintenance until her death or remarriage in so far as she is not able to provide therefor from her own means and earnings – Proof and disposal of a claim for maintenance of the survivor is required to be dealt with in accordance with the provisions of the Administration of Estates Act 66 of 1965.

The second respondent claimed maintenance against her late husband’s estate. She and the deceased had been married for three years at the time of his death. The deceased’s will appointed the appellants, his children from a previous marriage, as his only heirs. The second respondent accordingly filed a claim against the deceased estate in terms of section 2 of the Maintenance of Surviving Spouses Act 27 of 1990, alleging that she had been unemployed for the previous 4 years and had relied solely on the deceased for income to pay her monthly expenses. The first respondent allowed the second respondent’s claim and included it in the liquidation and distribution account. The appellants then lodged an objection to the account in

terms of section 35(7) of the Administration of Estates Act 66 of 1965 alleging that the second respondent had failed to lay a proper factual basis for the claim for maintenance. The Master upheld the objection. On review, the court below set aside the Master’s decision, and declared that the second respondent was entitled to reasonable maintenance. That led to the present appeal.

Held – Section 2 of the Maintenance of Surviving Spouses Act provides that if a marriage is dissolved by death the survivor shall have a claim against the estate of the deceased spouse for the provision of her reasonable maintenance until her death or remarriage in so far as she is not able to provide therefor from her own means and earnings. The proof and disposal of a claim for maintenance of the survivor is required to be dealt with in accordance with the provisions of the Administration of Estates Act.

The present Court found the manner in which the case had been pleaded, argued and adjudicated at trial to be unsatisfactory. The appeal grounds were limited to an appeal against the declaratory order and the order that each party should pay their own costs in the trial. To grant the appeal against the declaratory order could be construed as a finding that the second respondent was not entitled to reasonable maintenance. That would be unacceptable because the court agreed that she was entitled thereto. The essential error made by the court a quo was that having set aside the Master’s decision, despite agreeing with his finding that the second respondent had an entitlement to reasonable maintenance, it neglected to provide a means for determining quantum. The matter was remitted to the Master to decide the question of quantum.