Games General Terms and Conditions 150921

THE SA ATTORNEYS’ JOURNAL
APRIL 2014
SUGAR-COATING
GUILT
Admission
of guilt fines –
no easy fix
Merger and
takeover law
Impact on private companies
Fair divorce:
Misconduct does not play
a role in forfeiture claims
RNEYS’ JOURNAL
THE SA ATTORNEYS’ JOURNAL CONTENTS

APRIL 2014 Issue 540
ISSN 0250-0329
Regular columns
Editorial
Common law contingency fee agreements matter
resolved 3
News
4 Late President Mandela’s academic life and legal career 4
The fight against counterfeiting 5
Conveyancing admission examination rescheduled 5
Twenty years of democracy: NADEL’s commitment to
demcratic debate and socio-economic justice 6
Can ethics be taught? 8
Saslaw pro bono NPC launched 12
New Bills passed 13
Costs indaba 14
LSSA news
6 7 Legal Practice Bill passed and awaiting Presidential
assent 16
LSSA to launch election observer team to observe the
national elections 16
Norton Rose Fulbright and Lankalebalelo Attorneys in
LSSA Synergy Link 17
People and practices 18
Practice notes
Common law right to claim interest 20
8 14 Having a hunch – tapping into your senses 21
Practice management
Have you paid your dues? 23
The law reports 39
Case notes
Limitations on liability in delict 44
Waiver of rights in insolvency 45
New legislation 46
17 Employment law update 50
DE REBUS – APRIL 2014

-1-
FEATURES EDITOR:
Mapula Thebe
NDip Journ (DUT) BTech (Journ) (TUT)
24 Sugar-coating guilt News EDITOR:

Nomfundo Manyathi-Jele
Admission of guilt fines - no easy fix NDip Journ (DUT) BTech (Journ)(TUT)
sUB-EDITOR:
I
Kevin O’ Reilly – MA (NMMU)
n this article, Dr Llewelyn sUB-EDITOR:
Kathleen Kriel – BTech (Journ) (TUT)
Curlewis discusses the judg-
Editorial secretary:
ment in the matter of S v Tong Shireen Mahomed
2013 (1) SACR 346 (WCC) and Editorial Committee:
Danie Olivier (Chairperson), Peter Horn,
the importance of a dmission of
Sithembele Mgxaji, Mohamed Randera
guilt fines, which is often consid-
Editorial Office: 304 Brooks Street, Menlo Park,
ered a quick fix, an easy way out, Pretoria. PO Box 36626, Menlo Park 0102. Docex 82, Preto-
or a short-cut conclusion by de- ria. Tel (012) 366 8800 Fax (012) 362 0969.
fence practitioners and prosecu- E-mail: [email protected]
tors alike, where it might – in fact DE REBUS ONLINE: www.derebus.org.za

– represent a significant threat. Contents: Acceptance of material for publication is not a guar-
antee that it will in fact be included in a particular issue since this
depends on the space available. Views and opinions of this journal
are, unless otherwise stated, those of the authors. Editorial opinion
30 Merger and takover law

or comment is, unless otherwise stated, that of the editor and pub-
lication thereof does not indicate the agreement of the Law Society,
unless so stated. Contributions may be edited for clarity, space and/
Impact on private companies or language. The appearance of an advertisement in this publication

does not necessarily indicate approval by the Law Society for the prod-
B
uct or service advertised.
asil Mashabane gives a fol- De Rebus editorial staff use the LexisNexis online product: MyLexis-
low-up on his previous article Nexis.
Go to www.lexisnexis.co.za for more information.
‘Mergers and takeovers un- Printer: Ince (Pty) Ltd, PO Box 38200, Booysens 2016.
der the new Companies Act’, and Audio version: The audio version of this journal is avail-
discusses how the Act has brought able free of charge to all blind and print-handicapped mem-
bers of Tape Aids for the Blind.
enormous changes to the way
Advertisements:
mergers and takeovers are regulat- Main magazine: Ince Custom Publishing
ed in South Africa and the impact Contact: Ian Wright • Tel (011) 305 7340 • Fax (011) 241 3040
Cell: 082 574 6979 • E-mail: [email protected]
on private companies. Classifieds supplement: Contact: Kathleen Kriel
Tel (012) 366 8800 • Fax (012) 362 0969
PO Box 36626, Menlo Park 0102 • E-mail: [email protected]
34 Is sexting a criminal offence? Account inquiries: David Madonsela

Tel (012) 366 8800 E-mail: [email protected]
Circulation: De Rebus, the South African Attorneys’ Jour-
T
nal, is published monthly, 11 times a year, by the Law Society
he act of ‘sexting’ or to ‘sext’ is defined as the ex- of South Africa, 304 Brooks Street, Menlo Park, Pretoria. It cir-
change of pornographic material or sexually explicit culates free of charge to all practising attorneys and candi-
messages, pictures or videos via a mobile phone or date attorneys and is also available on general subscription.
Attorneys’ mailing list Inquiries: Gail Mason
the internet. In this article Lesedi Malosi Molosiwa deter- Tel (012) 441 4629 E-mail: [email protected]
mines how South African courts and legislation have dealt All inquiries and notifications by practising attorneys and
candidate attorneys should be addressed to the relevant
with the sexting phenomenon law society which, in turn, will notify the Law Society of SA.
Subscriptions:
General, and non-practising attorneys: R 762 p/a
37 Fair Divorce: Misconduct does Retired attorneys and full-time law students: R 586 p/a
Cover price: R 80each
not play a role in forfeiture claims Subscribers from African Postal Union countries (surface
mail): R 1211 (VAT excl)
T
Overseas subscribers (surface mail): R 1 344.20 (VAT excl)
here is a general misconcep-
New subscriptions and orders: David Madonsela
tion in divorce litigation that Tel: (012) 366 8800 • E-mail: [email protected]
a finding of substantial mis-
conduct on the part of a spouse
justifies an order for forfeiture Mpasa logo.fh11 6/17/09 3:10 PM Page 1
C M Y CM MY CY CMY K
of benefits of a marriage in com-

munity of property. Magdaleen de © Copyright 2014:
Law Society of South Africa 021-21-NPO
Klerk writes that the substantial Tel: (012) 366 8800
misconduct is only one of the fac-

tors the court may take into con- Member of the Magazine Member of
sideration in this regard. PublishersAssociation of
South Africa.
The Audit Bureau of
Circulations of Southern Africa
DE REBUS – APRIL 2014 Composite
-2-
EDITOR’S NOTE
Common law contingency fee

agreements matter resolved
cially or otherwise in return for a
share in the proceeds.
At para 2 the court stated: ‘At
issue are contingency fees. Un- Would you like
der the common law legal
practitioners were not al- to write for
lowed to charge their cli-
ents a fee calculated as
De Rebus?
a percentage of the pro-
ceeds the clients might
Mapula Thebe – Editor be awarded in litigation. De Rebus welcomes article
The Act changed this. contributions in all 11 official
It makes provision for languages, especially from
T
these fees to be charged in regulated legal practitioners. Practition-
he much contested issue of
instances and at set percentages. Cer- ers and others who wish to
common law contingency
tain law societies made rulings allowing submit feature articles, prac-
fee agreements was resolved
their members to charge in excess of the tice notes, case notes, opinion
by the recent Constitutional
percentages set in the Act. Uncertainty pieces and letters can e-mail
Court (CC) judgment in De
reigned in the attorneys’ profession their contributions to dere-
la Guerre v Ronald Bobroff & Partners
about the correct legal position in rela- [email protected].
Inc and Others (CC) (unreported case no
tion to contingency fees.’ The decision on whether to
CCT 122/13 , CCT 123/13, 20-2-2014)
The CC unanimously found that the publish a particular submis-
(Moseneke ACJ, Skweyiya ADCJ, Cam-
legislature’s decision to regulate con- sion is that of the De Rebus
eron J, Dambuza AJ, Froneman J, Jafta
tingency agreements in the case of Editorial Committee, whose
J, Madlanga J, Van der Westhuizen J and
legal practitioners only was not irra- decision is final. In general,
Zondo J) and The South African Asso-
tional. The CC also found no merit to contributions should be use-
ciation of Personal Injury Lawyers v The
the challenge to particular provisions of ful or of interest to practising
Minister of Justice and Constitutional
the Act. The court emphasised that the attorneys and must be origi-
Development (The Road Accident Fund
matter concerned the right of access to nal and not published else-
Intervening [2013] 2 All SA 96 (GNP).
justice by practitioners’ clients and not where. For more information,
Both these cases dealt with the issue of
a right of the legal practitioners. see the ‘Guidelines for articles
the constitutionality of the Contingency
Both these matters were on appeal in De Rebus’ on our website
Fees Act 66 of 1997 (the Act). In the
from the North Gauteng High Court in (www.derebus.org.za).
cases, the issue debated was whether it
Pretoria and were dismissed with costs. • Please note that the word
was justifiable for legal practitioners to
• See also 2013 (Apr) DR 50. limit is now 2000 words.
charge contingency fees outside of the
• Upcoming deadlines for arti-
25% the Act provides for. The cases also
cle submissions: 22 April and
dealt with whether it was rational that
19 May 2014.
the non-regulation of agreements con-
cluded by lay persons where one party
undertakes to promote litigation finan-

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NEWS
Late President Mandela’s

academic life and legal career
F
ollowing the passing of former
President Nelson Mandela on 5
December 2013 at the age of 95,
De Rebus contacted the Presi-
dent of the Law Society of the
Northern Provinces (LSNP), Dr Llewellyn
Curlewis for more information on for-
mer President Mandela’s academic life
and legal career.
Dr Curlewis said that according to re-
cords at the LSNP offices, Mr Mandela
began his studies for a Bachelor of Arts
degree at the University College of Fort
Hare but did not complete the degree
there as he was expelled for joining a
student protest. He completed his BA
through the University of South Africa
and went back to Fort Hare for his gradu-
ation in 1943. During the early 1940s
in Johannesburg, Walter Sisulu intro-
duced him to Lazer Sidelsky and he did
his articles at Witkin Eidelman Sidelsky. The late former President Nelson Mandela with then LSNP president
During his time at university, Mr Man- Igna Klynsmith, and councillors Danie Olivier and Mike Pinnock at the
dela became increasingly aware of the annual general meeting of the Law Society of the Northern Provinces
racial inequality and injustice faced by held in Rustenburg in 1990.
non-whites. In 1944, he decided to join
the African National Congress and ac- of articles. He said that this is how Mr commitment to the cause saw him pro-
tively took part in the struggle against Mandela qualified as an attorney on 27 moted through the ranks of the ANC.
apartheid. He began studying for an LLB March 1952. He and his friend Oliver In 1956, Mr Mandela, along with sev-
degree at the University of the Witwa- Tambo opened the first black legal prac- eral other members of the ANC were ar-
tersrand. By his own admission he was tice, Mandela & Tambo, in South Africa rested and charged with treason. After a
a poor student and left the university in in 1952, giving affordable and often free lengthy and protracted court case the de-
1948 without graduating. advice to black people who could other- fendants were finally acquitted in 1961.
Dr Curlewis said that during 1949 wise not afford it. According to Dr Curlewis, with the ANC
the minimum qualification for entering Dr Curlewis said that as one of the few now banned, Nelson Mandela suggested
the profession was the Attorney’s Di- qualified black lawyers, Nelson Mandela an active armed resistance to the apart-
ploma (Dip Proc) followed by five years was in great demand. He added that his heid regime. This led to the formation of
Umkhonto we Sizwe, which would act as
a guerrilla resistance movement. Receiv-
ing training in other African countries,
Umkhonto we Sizwe took part in active
sabotage.
Dr Curlewis said that in 1963, Mr Man-
dela was again arrested and put on trial
for treason. He said that this time the
state succeeded in convicting Mr Man-
dela of plotting to overthrow the govern-
ment.
In 1989, while in the last months of his
imprisonment, the late former President
obtained an LLB degree through the Uni-
versity of South Africa. He graduated in
absentia at a ceremony in Cape Town.
Roll of honour
Dr Curlewis said that Mr Mandela was
taken up in the roll of honour of the
The late former President Nelson Mandela with LSNP director Thinus Grobler;
LSNP for his contribution to the attor-
then advocate of admission and currently Judge of the North Gauteng
neys’ profession and participation in
High Court, Cynthia Pretorius (at the time still an advocate);
bringing democracy and freedom to the
then LSNP president, Emil Boshoff and Mr Mandela’s late son,
people of South Africa. Dr Curlewis add-
Makgatho Mandela at the admission of his son as attorney in August 2000.
ed that there are two other people that

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the LSNP council honoured in this way, ty applied to strike him from the roll, Dr court found that he would only be struck
namely, Mahatma Gandhi and former Curlewis said that Mr Mandela was ad- off if what he had done showed that he
President FW de Klerk. mitted as an attorney in the then Trans- was unworthy to remain in the ranks of
vaal province after having served a con- an honourable profession. This conten-
His practice tract of three years with Witkin Eidelman tion proceeds, again, on the incorrect
& Sidelsky. Shortly thereafter, his career assumption that is the court’s function
Dr Curlewis gave an outline of Mr Man- took a political turn and he was involved to punish an attorney who has been con-
dela’s legal career according to the in the political struggle for the abolition victed of an offence. The application was
LSNP’s archives. He said that on – of the pass laws and other measures of dismissed.
• 5 September 1952 Mr Mandela advised enforced racial segregation as well as the The LSNP also paid tribute to Mr Man-
the law society that he was practising on enforcing of the right of non-whites to dela at the time of his death. In a state-
his own; vote. ment, Dr Curlewis said that the LSNP was
• 4 December 1953 he informed the law Dr Curlewis said that as a result of his sad to learn of his passing and added
society that he was in partnership with actions, he was found guilty of contra- that the LSNP council mourns and cel-
Oliver Tambo; vening the provisions of the Suppression ebrates ‘the life of one of South Africa’s
• 8 January 1961 he notified the law so- of Communism Act 44 of 1950 and be- well-known and well-loved attorneys.’
ciety that he was practising as a profes- cause of this, an application was made to ‘He served on many international insti-
sional assistant; strike his name from the attorneys’ roll. tutions. He gave meaning to the principle
• 7 June 1961 the law society was in- ‘The court refused to entertain this of the rule of law. He fought for equality,
formed that Mr Mandela was no longer application and found that, although freedom and democracy. We will contin-
employed as a professional assistant but his actions could be regarded in a seri- ue to promote and protect his legacy and
that he was doing ‘odd jobs’ at the mag- ous light, he was motivated by an urge to the principles for which he fought’, he
istrates’ court. When the treason trial re- be of service to fellow non-whites. This stated. He added that Mr Mandela would
sumed, he left to attend to the trial. was not sufficient reason for striking his be remembered as a lawyer who had
• 5 July 1961 the law society was in- name from the roll,’ he said. courage and took the initiative to open
formed by Germiston law firm, H Davi- According to Incorporated Law Socie- the very first black attorneys firm in
doff and Herman that Mr Mandela had ty, Transvaal v Mandela 1954 (3) SA 102 Johannesburg.
ceased practising. (T), the court also found that Mr Mandela
When asked to talk about the court must not be punished again by being Nomfundo Manyathi-Jele,
case when the then Transvaal Law Socie- struck from the roll or suspended. The [email protected]
The fight against Conveyancing

counterfeiting admission
examination
C rescheduled
ape Town attorney Vanessa Ferguson, speaking at a round
table on the fight against counterfeiting in Cape Town on
13 February, said that because South Africa has the largest
economy in Africa, it is the top destination for counterfeit
goods, with tax revenue in excess of R 2,5 billion estimated to be lost
Please note that, due to
on counterfeit cigarettes annually. She added that in 2010 counterfeit-
ing was responsible for 14 400 job losses in the textile and clothing the fifth national
industries alone. general elections
Ms Ferguson, who is head of anti-counterfeiting at law firm DM Kisch taking place on 7 May,
Inc, and also the convener of the INTA MEASA (Middle East, Africa and the conveyancing
South East Asia) anti-counterfeiting subcommittee and SAIIPL anti-
examination has been
counterfeiting committee, said that outcomes from the deliberations
were that there was an urgent need for changes to the current Coun- rescheduled to 14 May.
terfeit Goods Act 37 of 1997 as counterfeiters were becoming more
sophisticated. The professional examination dates
The International Trademark Association (INTA), the South Af- for 2014 are as follows:
rican Institute of Intellectual Property Law (SAIIPL), the City of
Cape Town and government jointly hosted the round table on 14 May: Conveyancing examination
the fight against counterfeiting at the Cape Town Civic Centre. 11 June: Notarial examination
Attendees to the event included members of the Specialised Com-
mercial Crime Unit, the National Prosecution Authority, the South 12 August: Admission examination
African Police Service, and the South African Revenue Service, Customs and 13 August: Admission examination
Excise. 10 September: Conveyancing exami-
In a press release, Vanessa Ferguson, said that the purpose of the nation
event was, inter alia, to discuss building an effective policy and frame-
8 October: Notarial examination
work in the fight against counterfeiting, as well as strengthening an
already existing relationship that would allow sharing information and
NB: Candidates should register for
working together in order to improve anti-counterfeiting measures in
the examinations with their relevant
the country.
provincial law society.

-5-
Twenty years of democracy:
NADEL’s commitment to democratic debate and
socio-economic justice
T
he National Association of achieving the eradication of poverty’.
Democratic Lawyers (NADEL) He added: ‘I would suspect that as the
held its annual general meet- National Association of Democratic Law-
ing (AGM) in Durban in Febru- yers we align ourselves completely with
ary. The theme for the confer- this direction, with this movement, with
ence was ‘Twenty years of democracy this change, which our society needs.
– NADEL’s commitment to democratic And we must understand that these
debate and socio-economic justice’. two parts of the ANC can sometimes be
Speakers debated issues around the in conflict with each other, because the
theme. power exercise and the way in which the
Opening the conference, Chairperson power exercise is conducted may not
of the Durban Branch, Raj Badal, asked properly sit with the movement ... . And
delegates to observe a moment of si- we must make sure that we remain true
lence in remembrance of all of those who to the cause of the movement aimed at
passed away in 2013, including former achieving a better order in the world and
President Nelson Mandela and former in South Africa and ensure that we make
Chief Justice Pius Langa. the difference between that and the day-
The President of NADEL, to-day exercise of political power and
Socio-economic justice Max Boqwana, welcoming del- ensure that somehow in the future we
egates at the annual general meet- make a contribution to how these two
Welcoming delegates, NADEL President,
ing held in Durban. sides, these two elements of the ANC
Max Boqwana, said that it was the organ-
come closer and closer together.’
isation’s first gathering since the pass-
Justice Yacoob commented on the dis-
ing of the first President of NADEL, Pius
connect between the values of the Con-
Langa and the first President of demo- rely on China for resources, which sti-
stitution and the values of many South
cratic South Africa, Nelson Mandela from fles the likelihood of the continent being
Africans. ‘Our Constitution talks about
whom members drew inspiration and self-sufficient and taking care of its own
equality before the law … and yet we
commitment to do what is just. Quoting people.
know that our society is the most une-
Mr Mandela he said: ‘There is nothing I Mr Boqwana said that to draw atten-
qual one and it is our duty to ensure that
fear more than waking up without a pro- tion to the issues he had spoken about,
society does become more equal. The
gramme that will help me bring a little NADEL had invited Raji Souran from the
difficulty is that 95% of the middle and
happiness to those with no resources, Palestinian Centre for Human Rights to
the upper classes do not believe in the
those who are poor, illiterate, and rid- share his experience as a lawyer operat-
values of true economic equality and it is
den with terminal disease.’ He further ing in a war zone. He said that Mr Souran
there that we have to make the changes.
said that a meeting of this nature forces would have reflected on the bully tactics
Our society says women and men are
delegates to pause and reflect on where of the United States, other Western coun-
equal, yet 90% of the men in our society
the organisation stands on the statement tries and Israel and the failure of inter-
… operate on the basis that women are
made by former President Nelson Man- national fora such as the International
there to be our chattel and our slaves at
dela. Criminal Court and the United Nations to
one level or another … . Our Constitu-
Mr Boqwana drew attendees’ atten- deal with the crisis in Palestine. He said
tion states that gay and lesbian people
tion to what was happening in the world that Mr Souran would have spoken about
are equal to everyone else, yet 80 to 90%
and in the country. He said that the ‘many countries’ lack of moral courage,
of people would strongly believe that gay
meeting was taking place during a time including our own, to stand up to bul-
and lesbian people are sinners.’
of ‘growing international capitalists’ lies’. He added that Mr Souran could not
Justice Yacoob said that the issue of
crises; unemployment is sky rocketing attend the conference as the airport he
corruption in South Africa should be
and salaries are plummeting in the de- was due to depart from was bombed.
looked at closely as the country is about
veloping world, while astronomical food
Disconnect between the to go through elections, which will give
prices and starvation ravage the Third
citizens an opportunity to make a contri-
World. The human rights abuses remain
unabated in countries like Sri Lanka,
Constitution and the bution towards the choice of appropriate
Ukraine … [and] Palestine. The post-Arab public leadership. He reminded delegates that
one is innocent until proven guilty and
Spring society in parts of our continent Delivering the keynote address, former
that nobody can be convicted of a crime
remains unstable and directionless as Constitutional Court Justice, Zak Ya-
unless there is proof beyond reasonable
reflected in what is happening in Egypt coob, said that the African National Con-
doubt. He added that voters have to en-
and Libya. The Central African Republic, gress (ANC) remained two things at the
sure that even if a person has not been
Sudan and the Democratic Republic of moment, namely – ‘a party in power and
convicted of a crime, that they are mor-
the Congo continue to reflect badly on that it is still in many senses the only
ally right to run for office.
any probability of African renewal. The positive force in our country as a move-
economies of many other countries in ment … . It is the only organisation which
our continent are hardly benefiting their embraces the values of the Constitution
Tribute to former
citizens but continue to be the append- … which is committed to achieving true Chief Justice Pius Langa
ages of their former colonial countries ...’. democracy in our country … towards Paying tribute to former Chief Justice
He added that the continent continues to achieving a fair society and towards Pius Langa, Publicity Secretary of NADEL,

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NEWS
Gcina Malindi, said that the organisation Dullah Omar Memorial

was honored to have members of the
Langa family present at the conference. Lecture
Mr Malindi spoke about former Chief Deputy Minister John Jeffery delivered the
Justice Langa’s contribution to guarding Dullah Omar Memorial Lecture. Speaking
the institution of the judiciary and ‘his on the recent criticism of the appoint-
commitment to ensuring that the judi- ment of judges, he said the process of
ciary is what the Constitution tells us it appointing judges by the Judicial Ser-
should be, that the judicial authority of vice Commission (JSC) was outlined in
the republic is vested in the courts and the Constitution in an open, transpar-
that they are independent and subject ent and consultative system. ‘As for the
only to the Constitution and the law, composition and structure of the JSC,
which they must apply impartially and these provisions are also outlined in the
without fear, favour or prejudice’. Constitution, in section 178 thereof. So
Mr Malindi quoted former Chief Jus- when people criticise the JSC, they would
tice Ismail Mohamed who said judges are be well advised to remember that these
given the most formidable power, which provisions were part and parcel of the
they enjoy to use for the benefit of soci- constitutional text which certified by
ety and the Constitution but which they the constitutional court in the certifica-
can also abuse. He said that delegates tion judgments. So, to accuse the ANC of
should be constantly aware of the con- “chipping away at the foundations of our
text that judges are elevated to occupy Nokukhanya Jele, constitutional democracy” when it fol-
one of the three branches of government former Publicity Secretary lows the procedure as set out in section
and are therefore tasked with the func- of NADEL, speaking on the Legal 178 of the Constitution is simply absurd.
tion of ensuring that the state functions Practice Bill. How can it be unconstitutional to follow
well in a constitutional state where the the Constitution?’ he asked.
foundation of democracy is an elected Mr Jeffery agreed that the judiciary
parliament. was not yet fully transformed and more
Mr Malindi said that judges take an neys was fragmented and the two were was needed to be done with regards to
oath that reads: ‘I swear or solemnly regulated by different laws. Mr Sibanyoni its transformation, but added that sig-
affirm that as a judge of the Constitu- also pointed out the disparities between nificant progress had been made. ‘We
tional Court, Supreme Court of Appeal, the attorneys’ and advocates’ profession no longer have magistrates who are
High Court or any other court, I will be highlighting the difference in the way in part and parcel of the public service and
faithful to the Republic of South Africa, which both professions qualify through therefore under the control of the Min-
will uphold and protect the Constitution articles and pupilage. ister or Director-General. We no longer
and the human rights entrenched in it, Mr Sibanyoni said that the legal pro- have presiding officers who uphold
and will administer justice to all persons fession was not representative of the de- apartheid laws while knowing them to
alike without fear, favour or prejudice mographics of the country and access to be unjust and inhumane,’ he said.
in accordance with the Constitution and justice by the poor was limited. ‘This Bill Speaking on the Legal Practice Bill,
the law.’ He said that Justice Langa re- seeks to correct these shortcomings by Deputy Minister Jeffery said that even
cited the oath in isiZulu, his mother uniting the legal profession and regulat- when the Bill is assented to, the estab-
tongue, when he was appointed judge of ing it by means of a single statute un- lishment of the Legal Practice Council
the Constitutional Court to show that he der a single umbrella regulatory body, cannot take place for a while. He added
meant every word. the South African Legal Practice Coun- ‘The Bill as you may know, provides for a
‘Comrade Pius started working as an cil. … It recognises the independence of consultative forum to resolve some out-
interpreter messenger, proceeded to be the legal profession and endeavors to standing issues regarding matters such
a magistrate, and practised as an advo- strengthen this independence. The Bill as the powers of provincial structures
cate. In all these offices he had experi- is, inter alia, a measure to democratise and the manner of election of the repre-
enced how judicial officers in the crimi- the structures governing the profession, sentatives of attorneys and advocates on
nal justice system had not adhered to the which in turn will lead to greater trans- the Legal Practice Council.’
principles of upholding and protecting formation,’ he said.
human rights; they were faithful to the Johannesburg Advocate Nokukhanya The NADEL national
protection of the apartheid regime and Jele, former Publicity Secretary of NA- executive council:
entrenching discrimination. Comrade DEL, said that the Bar seemed to be of President: Max Boqwana
Pius worked very hard for the entrench- the view that independence of the pro- Vice President: Mvuzo Notyesi
ment of the human rights that are in our fession means that it should remain General Secretary: Patrick Jaji
Constitution and the principles that are separate and that nothing remotely re- Assistant General Secretary: Xolile
contained in the oath or solemn affirma- sembling a unified profession can exist, Ntshulana
tion that judicial officers have to take,’ lest such independence was obtained. Treasurer: Tony Thobane
Mr Malindi said. She said that NADEL has been in favour Assistant Treasurer: Poobie Govin-
After Mr Malindi’s speech, a DVD pre- of a unified profession since its incep- dasamy
sented by the Langa family was screened tion as an organisation. Referring to the Publicity Secretary: Gcina Malindi
for delegates. composition of the Legal Practice Coun- Projects Officer: Ashraf Mahomed
cil she said: ‘The critics of the Bill sug- Fundraising Officer: Willy Phalatsi
Legal Practice Bill update gest any slight participation of any state Gender Desk: Harshna Munglee
JB Sibanyoni, a member of the Portfolio entity will make this a completely state-
Committee for Justice and Constitutional controlled body. How exactly is it that
Development, gave a brief update on the three persons chosen by the Minister for
status of the Legal Practice Bill. He said their knowledge and experience in the
that the current situation is that legisla- legal field out of 21 members of a body, Mapula Thebe
tion pertaining to advocates and attor- makes it a state-controlled profession?’ [email protected]

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Can ethics be taught?
T
he Law Society of South Africa • extend to all colleagues, judges, aca-
(LSSA), in conjunction with demics, professionals, litigants and stu-
the National Association of dents, including persons from foreign
Democratic Lawyers, held a jurisdictions, cordiality and respect at
summit on professional legal all times.’
ethics in Durban at the end of February. Mr Govender said that it was sad that
Topics debated included ethical lawyer- some attorneys were not aware that this
ing in a constitutional democracy, ethics code exists. He added that getting ethics
in the pursuit of transformation as well accepted, understood and applied has
as legal ethics education. always been a major problem. He said
Retired Constitutional Court Justice, that he believed that one cannot create
Zak Yacoob, delivered the keynote ad- an ethical lawyer as one cannot make a
dress. Delegates who presented pa- person ethical, adding that ethics was
pers were admitted attorney and legal about the values one is born and brought
academic at Rhodes University, Helen up with.
Kruuse; attorney at Le Roux Matthews & The Chairperson of the LSSA ethics Mr Govender said that some 40 or
Du Plessis, Chris du Plessis and attorney committee, Krish Govender, gave more years ago, those that had a calling
at Ngubane & Partners Incorporated, Ma- the welcome address at the recent to become lawyers wanted to do some-
doda Nxumalo. The Chairperson of the ethics summit held in Durban. thing to serve people. ‘There was a cer-
LSSA ethics committee, Krish Govender tain amount of honesty, integrity, value
gave the welcome address. and satisfaction that you got to have
of Rights. We must practise law within done something good for someone and
Following the code of a state on the basis of what is fair and earned a small fee. The landscape today,
just and never try to take advantage of or over the past 20 years, even worse, in
ethics the poor, the small firms, [or] those who the past five years, is that of absolute
Mr Govender referred to an International cannot afford to run cases like the state greed and corruption. This is the land-
Bar Association conference held in Dub- can,’ he said. scape that young lawyers have to con-
lin some two years ago. He said that he Mr Govender noted that the LSSA has front and are swallowed up in at the mo-
was concerned to notice that during the a code of ethics that was adopted by its ment,’ he said.
plenary sessions of that conference, out council at its annual general meeting in According to Mr Govender ethics is
of the approximately 5 500 delegates March 2006. He said that the code of not about being honest and absolutely
that attended the conference, only 30 to ethics applies to all law societies and at- clean in what one does, as that has to
50 attended the session on ethics. torneys, adding that it consists of nine be a given. ‘Ethics is something that is
Mr Govender said that the world was points, namely: above that, much higher than that. It is
too overwhelmed by corporate lawyers ‘All legal practitioners shall – about fairness and transparency.’ He
with a corporate mentality. He urged • honour, respect and promote the val- concluded by saying that there was a
South African lawyers to see themselves ues enshrined in the Bill of Rights; fine line between ethics and attorney-
as lawyers in a developing, growing na- • maintain the highest standards of hon- client privilege as far as legal practice
tion and to entrench ethical principles. esty, integrity and independence at all was concerned.
According to Mr Govender, law students times;
are being told ‘if you apply ethics to your • act with care and skill, honour under- Ethical lawyering
work, you will not make money.’ He said takings and maintain the reputation and Speaking on ethical lawyering in a consti-
that this was very worrisome and ques- high standards required in the perfor- tutional democracy, Justice Yacoob said
tioned what law students were being mance of their duties; that he disagreed with Mr Govender as
taught and what kind of values they were • conduct themselves with courtesy and he did not believe that a lawyer is born
seeing in the profession. He added that respect towards participants in proceed- ethical. He added that people grow, de-
this was all part of the way society was ings, especially persons without legal velop, change and learn with time. Jus-
being structured. representation, so as to ensure compli- tice Yacoob said that he also took that
Mr Govender said that practitioners ance with the rules and procedures for route. He said that in 1956 he was a
who take ethics seriously were con- the fair conduct of such proceedings; racist, an opportunist and sexist, add-
cerned about the type of practitioners • maintain the highest standards of ing that ‘all of us have the potential to
that they see, hear and read about; and professionalism and promptly respond change and become better and also have
the difficulties that the public faces in to correspondence and messages from the potential to become ethical lawyers,
relation to the type of practitioners they colleagues, clients and members of the how ever we were born. All human be-
come across. public; ings have the right and the power to
Mr Govender raised the vexed question • comply with all ethical and profession- change themselves.’
of ‘how do you keep up ethics?’ He said al rules of practice; Justice Yacoob said that the part of the
that state attorneys must be empowered • respect the legal privilege and confi- Constitution that has an impact on law-
to act ethically, adding that the role of dentiality that exists with clients and yering in a constitutional order was the
state attorneys needed to be reviewed. former clients; Bill of Rights and chap 8 of the Constitu-
‘I tell attorneys that the day you come • subject to the laws as regards contin- tion, which apply to the courts and the
back from court and win a bad case, gency fees, and the rules and guidelines administration of justice.
you should hang your head in shame as regards advertising, not engage in any ‘If we [want to practise] in accordance
because you have done something that I form of activity that may be construed [with] the Bill of Rights and chap 8 of the
believe violates the Constitution and Bill as touting; Constitution, the first step for lawyers

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NEWS
is to know and understand both docu- ently do so because this behaviour exist-
ments.’ He said that the Bill of Rights ed in the lawyers of yesterday. Behaving
contains approximately 30 clauses that ethically and fairly leads to building the
are simple and straightforward. He add- judiciary,’ he said adding that the lawyer
ed that chap 8 of the Constitution was of today is the judge of tomorrow. The
also simple and straightforward and that ethical lawyer of today is building an
it was impossible for lawyers to practise ethical judicial system.
in accordance with the constitutional
principles if they did not understand Legal ethics education
the values and injunctions of the Bill of Ms Kruuse spoke on ‘the why, what and
Rights and what chap 8 required. ‘We how of legal ethics education today’. She
must not only understand them, we need said that the legal profession in South
to internalise and live them,’ he said. Africa was suffering from an ethical cri-
Justice Yacoob said that living the con- sis, adding that this can be noted from
stitutional order was the most important the media, case law and the recent LSSA
thing for an ethical lawyer, because if LLB summit where there was an effort to
you do not embrace constitutional val- interrogate legal ethics education. She
ues in your personal life, you cannot em- said that the precise nature of the cri-
brace them in your practice. Retired Constitutional Justice sis was unclear. Ms Kruuse said that the
He added that everyone is equal before Zak Yacoob gave the keynote origins or the causes of the ‘ethical cri-
the law and is entitled to equal protec- address at the recent summit sis’ are not properly understood, which
tion. The first port of call for people in on professional ethics makes finding solutions all the more dif-
trouble are lawyers ‘and when a person held in Durban. ficult.
comes to you, you have to treat him with Ms Kruuse focused on the potential
the understanding that this person is issues facing the legal profession today.
equal before the law.’ He explained that She said that the profession faced new
this meant that you must not treat your is not to get your client acquitted; that economic and social conditions that tear
rich clients better than your poor clients, is not your mandate and your mandate at its ethical fabric. Her presentation
as people can only be equal before the is not to get the client convicted either. dealt with three issues:
law if you treat them equally to begin Your mandate is to represent the client • Why legal ethics?
with. to the best of your ability as honestly as • What should be learnt at law schools
Justice Yacoob said that honesty was you possibly can, bearing in mind privi- and therefore what should be taught;?
a given but, like in all things, honesty lege and to ensure that the client has a • How can this be learnt and from whom?
was often qualified as far as practising fair trial,’ he stated. She said that lawyers play a public role
law is concerned. He said that honesty Justice Yacoob said that in civil trials, and also an important role in the justice
is balanced by privilege and that only a a constitutional right is not for people system. Ms Kruuse said that it was clear
few lawyers understand the importance to win their cases but that the purpose that the courts, and those who appear
of the privilege of their client. ‘It is not of adjudication, judging, and court pro- in them, are expected to act as the main
your privilege, but [that of] your clients. ceedings was to reach a fair result. He vehicles to protect and realise the rights
We need to examine what the precise bal- added that if one contributed as a lawyer of people, adding that lawyers are seen
ance is between honesty to the court on to reaching an unfair result, then that as especially responsible for what might
the one hand and privilege on the other,’ person was not acting constitutionally as happen to South Africa’s constitutional
he said. a lawyer. ‘The right that a person has is democracy over the next few years.
Justice Yacoob said that it was obvious not to win their case, the only obligation ‘The promotion of ethical decision-
that lawyers cannot stand by and watch you have, as a lawyer to your client is to making by lawyers is vital to support the
their clients tell lies in the witness box, ensure that those civil proceedings are justice system. If we do not interrogate
but queried what layers should do if a fair, held before an independent tribunal legal ethics education or look at our ethi-
client tells them that he or she (the cli- and if you do that, you have done your cal practices and adjust our actions ac-
ent) was committing another murder job. If you go beyond that and win the cordingly, the legal profession risks even
somewhere else on the day that he or she case unfairly, that is unconstitutional greater disrespect and even runs the risk
is accused of committing the murder the conduct,’ he said. of losing its monopoly. Is the profession
lawyers are defending him or her against Justice Yacoob concluded by saying only about staying in business and pro-
and that the accused would like to tell that every attorney, advocate, candidate tecting its prospects, rather than serving
the court that he or she was somewhere attorney and legal practitioner is po- the public’s interests?’ she asked.
else with somebody else, which is a lie. tentially a judge and that they needed Ms Kruuse defined the word ‘ethics’,
‘Do you put up with that? Those are dif- to bear this in mind, also that they are and said that it comes from the Greek
ficult problems that we need to deal with training with that vocation in mind. ‘Un- word ‘ethos’, which means ‘habit.’ ‘A
carefully. Honesty must be qualified with less one has an independent, impartial habit can be defined as an internalised,
privilege’, he said. legal system or lawyers who understand repeated, or innate principle that natu-
Moving on to the notion of a fair trial, the distinction between fairness and un- rally springs from within a person with-
Justice Yacoob said that s 25 of the Con- fairness and who treat people properly, out reference to an outside rule or com-
stitution has various individual provi- there can never be proper judgments,’ mandment,’ she explained.
sions that ensure that an accused has a he said. According to Ms Kruuse, South Africa
fair trial. He said that a very important Justice Yacoob added that lawyers is a diverse society and the habits of its
ethical consideration was that all ac- must be able to say that they can be a law school and graduates will not present
cused people deserved a fair trial, add- judge. He said that if lawyers become themselves as a unitary homogenous set
ing that the trial must be fair at all levels corrupt, the profession will be corrupt. of values. Therefore, whatever a student
and it was the lawyer’s duty to contrib- ‘You are contributing to judicial fairness. learns at university and at practical legal
ute to the fairness of a trial. ‘Your ob- Those who behave unconstitutionally in training (PLT), must compete with the
ject in [practising law] in a criminal case court and treat the poor or blacks differ- multiple moral and ethical influences

-9-
he or she has had prior to and beyond complaints such as, for example, trust
the reach of the law faculty and PLT. Ms shortages, make up less than one per
Kruuse said that ethics at law schools cent, which is still a shame but it is grati-
can be taught through summits such fying that it is such a small percentage.’
as this one, indabas, conferences and Regarding touting, Mr Du Plessis said
seminars. She said that some obstacles that touting was different to pro bono
standing in the way of students learning work and that there was much confusion
ethics or being taught ethics include the on the two matters. He said that there
students’ readiness and willingness to have been attorneys charged with tout-
engage meaningfully with ethical issues, ing because they bought cars in their
as well as the law teachers’ readiness. names and then gave them to estate
She added that law teachers resort to tra- agents to use in exchange of transfers.
ditional teaching, adding that these ways ‘We have a firm in a certain town with
alone simply will not do. Ms Kruuse said three banks. Every Friday morning the
that in the United Kingdom experimen- wives of the bank managers phone the
tal learning proved to be the best way to secretary at the firm of attorneys. The
teach law students ethics. secretary then tells them how much they
Ms Kruuse said that ideally, on com- can spend in the next week on the at-
pletion of their studies, students should Admitted attorney and legal torney’s credit card and the amount is
be able to demonstrate: academic at Rhodes University, determined by how many conveyancing
• a thorough understanding of the for- Helen Kruuse spoke on instructions were given to the firm.’
mal ethical and professional responsi- legal ethics education at the Du Plessis concluded by saying that
bilities in the lawyer’s role whether these recent professional ethics non-ethical behaviour had horrible con-
are expressed in legislation, case law or summit that was held sequences. He said that practising law
in a professional code; in Durban. was an awesome privilege that came
• a thorough understanding of the val- with awesome responsibility, and that
ues, social purposes, social responsibili- ethics was not a question of rule on
ties and limits of the lawyer’s role within because labour law wise, we are pass- rule but a manifestation of one’s inner
the legal, political and social system in ing the death sentence on somebody’s self. Ethics require the highest exercise
which South African lawyers practise; career, which is their life.’ Mr Du Ples- of your highest self, adding that ethics
• a developing ability to recognise the sis said that one of his students once eventually was to put your client’s inter-
typical situations in which ethical issues told him that ethics stand in the way of est before yours.
are likely to arise in legal practice, to en- making money when he asked his class
gage thoroughly and to make ethically what their views on ethics were. He said Transformation and ethics
justifiable decisions whenever circum- that the attorneys present at the summit Mr Madoda spoke on the impact of trans-
stances require this; and were there because they had satisfied formation on ethics. He said that, prior
• an understanding that the law and the court that they were fit and proper to 1994, historically disadvantaged prac-
codes are incomplete in addressing all persons. ‘However, fit and proper is not titioners were under the false illusion
ethical issues, and therefore develop an defined anywhere in any of the Acts. It is that, come democracy, they would eat
ability to exercise discretionary profes- a subjective phrase,’ he said. He added pie in the sky. ‘When the reality struck
sional judgment, through recourse to that the word ‘profession’ was derived home that the more things change, the
core professional values, whenever cir- from the Latin word ‘professio’, which more they stay the same attorneys, like
cumstances require this. means ‘worthy of public trust and admi- all spheres of our society, tripped over
Ms Kruuse said that there needed to ration’. He asked the delegates whether each other to attain personal aggran-
be a compulsory course on ethics in the they conduct themselves in such a way dizement at the expense of ethics. The
LLB degree curriculum at all universi- that people can admire and trust them. legal profession, and I have no doubt
ties, adding that most universities did According to Mr Du Plessis, the most most professions, was so engrossed in
not have it. She added that law students important asset that one can ever have is transformation and inadvertently ne-
needed to be encouraged to appreciate their name as it encompasses integrity, glected ethics,’ he said.
the significance of ethical dimensions reputation, wisdom, judgment, etcetera According to Mr Madoda, in the name
of legal practices. She said that lawyers and it can be lost in the proverbial one of transformation, ethics are flouted day
needed to develop a personal style of second. If this happens, how and when in and day out in order to score large
practice that reflects this depth of ap- do you get it back?’ He advised attorneys state contracts or to do shoddy work in
preciation and understanding. to guard their names jealously, adding courts to get a quick buck. He said: ‘We
that to be an attorney means that you are are prepared to hire previously disadvan-
Ethics in practice a person worthy of admiration. He said taged practitioners in order to fulfil quo-
Mr Du Plessis, one of the Chairpersons that one could not be a part-time hon- tas and score cards, all under the pretext
of the Law Society of the Northern Prov- est or honorable person, as one is honest of economic empowerment ... . Recently,
inces (LSNP) disciplinary committee, and and honourable in totality or not at all. an in thing is to swallow smaller firms,
a PLT lecturer for the past 18 years, told Mr Du Plessis stated that in the past who happen to be black, by larger firms
delegates that he has heard a few thou- 13 years there had been about 20 news- but only to attract contracts. There is
sand cases on the wrong end of ethics. paper articles per year about attorneys, nothing wrong with it as long as such
He described the feeling he gets when he besides the many letters. He said that hiring and merging are equally beneficial
chairs a meeting that recommends that the LSNP receives numerous attorney to both players. The problem only arises
they contact the court to remove an at- complaints, approximately 12 000 a when there are sinister undertones. Once
torney’s name from the roll, as devastat- year, adding that many of them are petty we invoked such mischievous thoughts,
ing. matters, such as a lack of communica- then we have ethical issues. Some of us
Mr Du Plessis said: ‘I can imagine that tion between attorney and client by, for view transformation as a threat to our
the judges in the old days when pass- example, not replying to e-mails. He said: wealth and we are prepared to protect it
ing the death sentence felt like this, ‘Surprisingly and thankfully, serious even if means defying ethics.’

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NEWS
Mr Madoda said that South Africa the sooner South African citizens learn raised that the curriculum was too aca-
finds itself in a difficult place, adding to stop complaining about what they do demic and not practical enough. The
that it was a nation in transition, a young not have and started using what they groups said that it was difficult to teach
democracy that has no identity. It is a have, the better for the country and the ethics as everyone was brought up differ-
country trying to find itself and one that profession. ently. One group said that medical stu-
is battling to synchronise ethics in line According to Mr Madoda, the judiciary dents do practical work during holidays,
with the prescripts of the Constitution. and the media has been the profession’s suggesting that law students should be
‘We are no longer afraid to express our- beacon of hope in the battle against mor- doing the same. It was suggested that an
selves, thanks to freedom of expression, al decay. He said that among all of this, ethics course be held for candidate attor-
whether in print media or on social net- the law was still a noble profession. neys and that legal ethics must be com-
works. The latter finds popularity with pulsory and must be taught every year as
younger practitioners. If there are no Breakaway session a part of every subject.
clear rules, for example, on how, what Before the conclusion of the summit, a • What is the best method of tuition at
and when to tweet, ethics becomes an group discussion took place. The break- LLB level and for PLT and continuing le-
unintended casualty. As a profession we away groups deliberated on five ques- gal education courses?
need to embrace change and dare not tions, namely: The groups unanimously said that
falter.’ He advised attorneys to take full • What impact does the South African practical work was the best method of
advantage of social media. broader context have on professional le- tuition. They said that the profession
Mr Madoda said that he has been told gal ethics? should be engaged and that law students
that in KwaZulu-Natal younger practi- In answer to this question, most of should partake in community and pro
tioners are the main culprits when it the groups were of the opinion that cul- bono services.
comes to misconduct. He said that he ture, religion and the diversity of South • What should be done to keep the mo-
believes that seasoned practitioners African citizens had an impact on pro- mentum and promote awareness of ethi-
were putting commercial interest before fessional legal ethics. They questioned cal decision-making by the legal profes-
those of mentoring up-and-coming prac- how all this diversity would be put into sion after the summit?
titioners. ‘Indeed, time is now not only one ethical code that everyone must The groups said that the profession
our stock in trade but it has also become abide by. They said that there was a cul- should use social media, radio and tel-
the new currency. If we fall short in men- ture of a lack of consequence in South evision to engage with practitioners.
toring, surely ethics suffers. We need to Africa and that a change of mindset was They also said that there should be fre-
balance the two’, he said. needed. They also questioned whether quent meetings between the profession
Mr Madoda said that he hopes that there was a common understanding and law deans, and that the LSSA should
the code of conduct, as envisaged by the of ethics, adding that the word ‘ethics’ have a review to ascertain what has been
Legal Practice Bill, will be able to align needed to be defined. achieved a year or two after this summit
ethical standards in conformity with the • Which rules are most relevant for the and to conduct a survey on what candi-
Constitution. profession going forward in 2014? date attorneys think ethical awareness
To conclude, Mr Madoda said that un- Some of the groups said that they be- is.
ethical behaviour was not confined only lieved that all rules were relevant as no One group said that the LSSA Trustline
to the legal profession but was ‘a cancer rule was more important than the oth- could also be used to report colleagues
that is devouring all spheres of our so- er, while others said honesty, integrity, who are behaving unethically. Another
ciety at unprecedented levels’. He said professionalism and mutual respect for group said that the presence of attor-
that it was in forums like these where we colleagues were the most relevant. One neys was needed to be felt at university
could try to curb such cancer. group questioned what the difference campuses.
Mr Madoda said that over the years was between ethics and morality and
the profession had introduced many in- said that morals were unique to a person
terventions in order to be in sync with while ethics were unique to a profession.
societal norms, principles and standards • What might be learned (and therefore
such as mandatory practice manage- should be taught) at LLB level and for the
ment, the Attorneys Development Fund profession?
and SynergyLink. South Africa was en- The general consensus was that there
dowed with opportunities, however, we should be a standard LLB curriculum Nomfundo Manyathi-Jele,
seem not to notice them. He said that across the country. A point was also [email protected]
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- 11 -
Saslaw pro bono NPC launched
T
he South African Society for gal representation. He said that the pro-
Labour Law (Saslaw) held a vision to access to justice for the poor
fundraising event that coin- was one of biggest challenges for the
cided with the launching of state and the profession.
Saslaw as a non-profit com- ‘Strike action raises the question of
pany (NPC). The event was held in Johan- why the poor do not see the courts as
nesburg. Speakers at the event included an avenue for their grievances. The rea-
the Deputy Minister of Justice and Con- son is that they see courts as complex.
stitutional Development, John Jeffery; The reality is that the poor cannot afford
Judge President of the Labour Courts, the cost of a number of basic things that
Basheer Waglay and Judge of the Labour are relevant to us, the cost of litigation is
Court, André van Niekerk. one of those. I believe that every mem-
ber of the profession should be strongly
Pro bono project encouraged to provide pro bono services.
Saslaw President Shamima Gaibie gave This does not only benefit the litigant
the welcome address. She said that the but also gives credibility to the rule of
Saslaw pro bono programme was estab- law,’ Judge Waglay said.
lished as an indispensable part of the Judge Waglay said that there was a
four Labour Courts across the country perception that courts are institutions
(in Durban, Port Elizabeth, Johannesburg Justice Department Deputy Minister of trouble and harassment. ‘This needs
and Cape Town) following the pro bono John Jeffery at the launch of Saslaw to change,’ he said. He added that courts
pilot project. as a non-profit company. must be seen as institutions where peo-
Ms Gaibie said that from February ple can obtain redress and human dig-
2011 to February 2014, the Saslaw pro nity. He concluded his speech by say-
bono project saw more than 7 800 clients Labour Court has taken the decision to ing: ‘We cannot have another Marikana.
assisted by approximately 230 practi- send the court to where a large number People must come to court to have their
tioners countrywide. She said that this of litigants are. ‘For example if there is grievances dealt with.’
equalled about 5 900 professional hours. a big group in Mpumalanga, we will
‘Of the clients seen, approximately 15% send a judge there instead of having 50 The role of the profession
of the cases that came through the pro- or 60 people coming to Johannesburg,’ and access to justice
ject have been taken up and just over 7% he said. Deputy Minister Jeffery spoke on access
of matters have been distributed to Legal to justice, in particular the role of the
Aid South Africa,’ she said. Access to justice legal profession and other stakehold-
Ms Gaibie said that it seems inconceiv- Judge President Waglay said that the ers in the light of the Legal Practice Bill.
able that the Labour Court had been able rule of law was not only a fundamental Speaking on the issue of pro bono legal
to function without this project. principle but was the point of departure services he said that it is a known fact
for labour peace. He said that a shortage that most South Africans, particularly
Saslaw at pro bono clinic of judges, court rooms and legal repre- the working and middle class across all
Judge Van Niekerk said that the judges sentation not only led to a delay in mat- races, battle to afford the services of pri-
valued the presence of Saslaw members ters being finalised but that it also had vate attorneys. He added that it is also a
at the pro bono clinic, adding that liti- a direct and substantial impact on em- known fact that most people, the ones
gants were usually referred directly from ployment and denied access to justice, a who have no legal background or train-
the court to the clinic. basic right of every citizen, and in turn ing, find the legal process and the justice
Judge Van Niekerk said that very often could lead to the erosion of the rule of system complicated and overwhelming.
what is needed is an explanation as to law. ‘In most cases, people know that they
why litigants do not have a case. He add- The Judge President said that over the have rights, but they have no idea how to
ed that people who have access to that past three years the Labour Court had go about enforcing those rights and es-
information or those who are advised called on labour law practitioners to sac- pecially in the area of labour law, where
properly of their rights often go away as rifice at least one week a year to act in there is what Professor Barney Jordaan
satisfied as those who walk away with the Labour Court in order to deal with calls, “the inherently unequal relation-
some sort of settlement or having won the increasing number of matters that ship between employer and employee”,
a cases. ‘While access to legal skills is an were ready to be heard but could not be the need for legal services becomes all
important component to access to jus- allocated to the limited number of per- the more apparent,’ he said.
tice, it is by no mean the only one,’ he manent judges. ‘This is not an ideal situ- Deputy Minister Jeffery said that he
said. ation and as a senior member of the Bar recently heard someone comment that
Judge Van Niekerk said that when the informed me, it is an exploitative prac- ‘the law is a social process’. He added
Labour Courts were set up, care was tak- tice,’ he said. that this was true as the law was often
en to put them in the areas of the city Judge President Waglay said that there the vehicle that brought about change
that were accessible to workers. ‘That is was a desperate need to address the is- in society and addressed various civil,
why the Labour Court in Port Elizabeth sue of the shortage of judges. He added political and socio-economic issues. ‘In
is right in the taxi rank and the one in that addressing the issue would also a country such as ours the disparity be-
Braamfontein is close to Park Station. It mean addressing the need for increased tween rich and poor, between the haves
was a conscious decision to have them infrastructure. and the have-nots, is glaringly obvious,
there.’ According to Judge Waglay, access to and we are still struggling to redress the
According to Judge Van Niekerk, the court is meaningless in the absence of le- injustices of the past.

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NEWS
According to the Deputy Minister ac- titioners, including as a commissioner in proved access to justice. He said that the
cess to justice is often still the privilege the small claims courts; justice department was undertaking a
of the wealthy. He added that this means • the provision of legal education and variety of other initiatives and interven-
that the demands for pro bono services training on behalf of the council, or on tions to improve access to justice. He
and legal aid are ever-increasing. behalf of an academic institution or non- said that the department was on track
‘If we have more legal practitioners do- governmental organisation; or in establishing small claims courts in
ing pro bono work it will make a signifi- • any other service that the candidate le- every magisterial district in the coun-
cant contribution to increased access to gal practitioner or the legal practitioner try; the recently passed Superior Courts
justice. In South Africa pro bono work is may want to perform, with the approval Act 10 of 2013 establishes a division of
governed by the rules of each province’s of the Minister. the High Court in each of the nine prov-
law society and the various Bar councils. He added that the Bill also states that inces, which opens up access to justice;
There have been significant contribu- the council may, on application and on and that the department was working
tions made by way of mandatory pro good cause shown, exempt any candi- on finalising the Traditional Courts Bill
bono work, especially by some of the date legal practitioner or legal practi- B1 of 2012 in order to bring the court’s
large law firms, who often go above and tioner from performing community ser- operation in line with the Constitution
beyond the requirements set by the law vice, as set out in the rules. ‘as these courts exist and provide access
societies. As an example, one firm, as Deputy Minister Jeffery said that dur- to justice and a mechanism for dispute
early as 2006, contributed 8 432 hours ing the deliberations on the Bill there resolution to many people in the rural
to pro bono work. This amounted to 34 were many complaints about the com- areas’.
hours per practitioner, ranging from munity service clause, mainly that it will The Deputy Minister concluded by
candidate attorneys to senior partners. be impractical to implement and that it commending Saslaw and the members of
In monetary terms, in 2006, this amount- is too vague and unclear on issues such its pro bono project and wished them the
ed to R 6,5 million. That same firm has in as who will monitor the process, who best in the endeavours of the Pro Bono
the past few years upped their commit- will remunerate them and who will have NPC. He said: ‘Every single person who
ment to pro bono work to 50 hours per to serve and for how long. He said that is being assisted by this project is a per-
year per practitioner,’ he said. there was not much opposition regard- son who is, through the project and its
Deputy Minister Jeffery spoke about ing community service for candidate work, being guaranteed access to justice.
community service, which is one of the legal practitioners and that opposition Access to justice builds confidence and
provisions of the Legal Practice Bill. He was mainly received with regard to re- trust not only in the judicial system, but
said that the Bill provides that commu- curring community service for existing in the rule of law, our democracy and our
nity service may include, but is not lim- practitioners, since practitioners felt constitutional dispensation.’
ited to, that it would be punitive. He added that
• service in the state; this was not the Bill’s intention as the in-
• service at the South African Human tention was for lawyers to give back by
Rights Commission; imparting their skills to others.
• service without any remuneration as a Deputy Minister Jeffery said that the Nomfundo Manyathi-Jele,
judicial officer in the case of legal prac- Bill was just one aspect relating to im- [email protected]
New Bills passed companies to sell 51% of their shares to South Africans. This
section will include an addition of para (c), which reads ‘if at
least 51 per cent of the ownership and control is exercised by
P arliament recently passed three new Bills, namely, the Res-

titution of Land Rights Amendment Bill B35 of 2013, the
Private Security Industry Regulation Amendment Bill B27 of
South African citizens’.
The Infrastructure Development Bill aims to provide for
the facilitation and coordination of public infrastructure de-
2012 and the Infrastructure Development Bill B49 of 2013. velopment, which is of significant economic or social impor-
The Restitution of Land Rights Amendment Bill aims tance to the country. It will also ensure that infrastructure
to amend the Restitution of Land Rights Act 22 of 1994. It development in the country is given priority in planning, ap-
amends the cut-off date for lodging a claim for restitution, proval and implementation and ensure that the development
meaning that it re-opens the land restitution process as it sets goals of the state are promoted through infrastructure de-
a new deadline for land claims to 31 December 2018 as op- velopment.
posed to the previous deadline of 31 December 1998. It also The Infrastructure Development Bill makes provision for a
aims to regulate the appointment, tenure of office, remunera- Presidential Infrastructure Coordinating Commission, which
tion and the terms and conditions of service of judges of the is tasked with performing the functions provided for in this
Land Claims Court. Bill. The Presidential Infrastructure Coordinating Commis-
The Private Security Industry Regulation Amendment Bill is sion will have the following members –
aimed to amend the Private Security Industry Regulation Act • the President;
56 of 2001. It aims to, inter alia – • the Deputy President;
• amend certain definitions; • Ministers designated by the President;
• provide for additional powers of the minister; • the premiers of the provinces; and
• provide for the authority to promote crime prevention part- • the executive mayors of metropolitan councils as well as the
nerships with other organs of state; chairperson of the South African Local Government Associa-
• provide for the regulation of ownership and control of a tion recognised in terms of the Organised Local Government
business operating as a security service provider; Act 52 of 1997 as the national organisation representing mu-
• regulate security services rendered outside South Africa; nicipalities.
and The Bill states that the President, or in his absence, the
• to empower the Minister to make regulations for the trans- Deputy President, is the chairperson of the commission.
portation of cash and other valuables. Some opposition parties have criticised the Bill as placing too
An amendment to s 20 of the Private Security Industry much power in the hands of the President to drive infrastruc-
Regulation Act will compel foreign-owned private security ture projects.

- 13 -
T Costs indaba
he Rules Board under, the
auspices of the Justice Depart-
ment, held an indaba on the
legal costs of access to justice
in Kempton Park in February
2014. The aim of the indaba was to fa-
cilitate discussion on the tariffs in the
and bring justice to all and to make a
Supreme Court of Appeal, High Court
positive difference to South African citi-
and magistrates’ courts; the creation of
zens.
a tariff for advocates and the overall im-
Judge Van Der Merwe highlighted the
pact of tariffs on access to justice. Top-
fact that none of the resolutions that will
ics discussed included sustainability of
be taken at the indaba would be binding
costs in the context of access to justice
of the Rules Board. He said that the fo-
and the structure of court tariffs for at-
cus of the indaba was on the recovery of
torneys.
cost on the basis that the successful par-
The Chairperson of the Rules Board,
ty must be compensated. Judge Van Der
Constitutional Court Justice Bess Nka-
Merwe said that Rules Board had to bal-
binde gave the welcome address and del-
ance the interest of various service pro-
egates who spoke included retired Depu-
viders that provide a service throughout
ty Judge President of the North Gauteng
the civil justice value chain and the re-
High Court, Willem Van Der Merwe; the
lated costs. He said that in terms of the
Chairperson of the costs committee of
Legal Practice Bill, the Rules Board will
the Rules Board, Patrick Hundermark
be given two years to determine tariffs
and the Chairperson of the Law Society
for all legal services that are rendered.
of South Africa costs committee, Asif The Chairperson of the
The tariffs will be determined by a vari-
Essa who made submissions on behalf of Rules Board, Constitutional Court
ety of factors that include the complex-
attorneys. Justice Bess Nkabinde, giving the
ity of the case, the experience of the legal
Justice Nkabinde said that the sensi- welcome address at the recent
practitioner, the amount of work and the
tivity of the discourse lay in the fact that costs indaba.
financial implications involved.
the matters that were being discussed af-
Judge Van Der Merwe concluded by
fected the livelihood of most of the peo-
saying that legal practitioners needed to
ple who were present at the indaba. ‘The
understand their responsibility. ‘People 2004, 2005, 2009 and 2013. He added
matters affect the livelihood of most of
become discontented with the Constitu- that there was a disparity between at-
us especially members of the legal pro-
tion and it affects the rule of law if what torney-and-own-client-costs on one hand
fession, including sheriffs. It also affects
they read in the Constitution is not a and the party-and-party tariff on the
members of the judiciary,’ she said.
reality to them. This discontent impacts other, adding that this inhibits access to
Justice Nkabinde said that the civil
the economy and the ability to practise justice.
justice system should respond to the
your profession,’ he said. Mr Essa said that various memoranda
needs of everyone, including the needs
have been prepared over the years, am-
of lawyers and sheriffs, adding that one Legal cost and access plified by economic data justifying in-
of the basic principles that should be
met by the civil justice system for the to justice creases that have not been implemented,
promotion of access to justice was pro- Mr Essa spoke on behalf of attorneys. He thereby adversely affecting access to jus-
portional cost in relation to the nature said that there were different role play- tice. He added that the recent increase in
of the issues involved and services ren- ers involved in the administration of jus- the statutory tariffs was inadequate and
dered by lawyers. ‘Our civil justice sys- tice, adding that attorneys were involved required immediate consideration.
tem does not meet this basic principle. in the filing of documents right up to the Mr Essa said that the methodology and
In addition to it being complex and too trial. He highlighted the fact that attor- frequency of increases in tariffs and the
slow, justice is also very costly. The cost neys were not remunerated for that and method of the calculation of disburse-
problem is one feature that characteris- added that this needed to be addressed. ments were causes of concern to the at-
es the problem in our adversarial justice ‘It is unfortunate that people do not torneys’ profession and the public. He
system,’ she said. understand the whole purpose of tar- concluded by saying that the legal pro-
According to Justice Nkabinde, the iffs which is to indemnify a successful fession as a whole, including sheriffs
vexed question is how to address the is- litigant against an unsuccessful litigant,’ and advocates, needed to get together to
sue of court fees without making it im- said Mr Essa, adding that it was not what discuss these issues.
possible for those who render service the client pays the attorney.
to be reasonably remunerated. ‘How do Mr Essa said that, with regard to the Unbundling
we also strike a balance by ensuring that legal costs on access to justice, attorneys reasonableness
successful litigants are properly indem- can negotiate fees with clients, usually at Advocate Ishmael Semenya SC spoke
nified for all costs they have incurred in the beginning of their mandate. This ar- on behalf of the General Council of the
litigation and at the same time making rangement is contractual and with the Bar of South Africa. He said that there
sure that the unsuccessful litigants are informed consent of the client. ‘The cli- must be access to justice, but that the
not unduly penalised for failing claims ent has the right not to engage the at- legal profession must contextualise what
against them,’ she asked. torney if he or she is not satisfied with that entails. He said that the Constitu-
Justice Nkabinde said that the quality the fee structure. These are known as at- tion also speaks of the right of access to
of justice was the function of the courts torney-and-own-client-costs. This is where healthcare. ‘If you begin to read the right
and added that what matters was that the public has lost sight of the whole issue to healthcare to mean that Joe Soap will
justice was made accessible to all. She of tariffs,’ he said. get access to the best cardiologist in the
added that lawyers had a pivotal role to Mr Essa said that tariffs increased country or the right to housing to mean
play in democracy. This role was to serve four times in the past decade, namely in that Joe Soap will be living in Clifton, you

- 14 -
NEWS
are beginning to distort the conversa- cost of litigation, it is vitally important to expenses must be increased urgently as
tion,’ he said. consider whether the civil justice system sheriffs are tariff bound and do not have
Mr Semenya said he believes what the is in need of an overhaul. ‘If you look at the cushion that attorneys have [that] of
Constitution intends to convey is that all developments in England and Germany having attorney-and-own-client-tariffs. Mr
those people who have legitimate civil and other jurisdictions, the reform of Bellairs said that new process was re-
disputes must be able to go and ventilate a legal costs regime always occurred in quired particularly in respect of the fre-
those disputes and have them arbitrated conjunction with an overhaul of the civil quency of increase in tariffs. ‘Sheriff’s
on in accordance with law by competent justice system. So before trying to over- charges must be kept in line with the
judicial practitioners. ‘We all agree that haul our legal costs regime, we must first escalation of costs in the economy and
the provision of legal services must be think about our justice system,’ he said. therefore must be reviewed on an annual
reasonable, the controversy is how to un- Mr Paleker added that alternative dis- basis,’ he said.
bundle that concept of reasonableness,’ pute resolution also needed to be looked He added that there needed to be uni-
he said. at and utilised more. He said that the ju- formity of tariffs in all the courts, add-
‘Ultimately if we all agree that the ser- risdiction of the small claims court needing that there must be a harmonisation
vices that are rendered by the advocates’ ed to be reviewed to allow for greater ac- between the tariffs for sheriffs in the
profession in litigation are essential, can cess to justice. ‘We should consider both High Court and the lower courts. ‘Tariffs
it really matter that they are rendered by the monetary and the substantive juris- must be simplified. They currently go on
someone wearing the hat of an advocate diction of small claims courts as turning for pages. They must also be more user
or that of an attorney?’ he asked. to these courts can attend to, this can friendly,’ he said.
Advocate Semenya concluded by say- reduce the costs of legal services as legal Mr Bellairs said that the travelling ex-
ing that the ratio of legal [services] representation is not permitted in these pense should also be the same all the
practitioners to the population of South courts,’ he said. courts.
Africa [citizens] was distorted. He added Mr Paleker said: ‘We do not have On behalf of group 4 Cape Town ad-
that the profession needed to be open to enough lawyers in the country involved vocate and Rules Board member Paul
more members to allow access to justice in a diverse range of new legal services. Farlam said that they had two views on
to a broader audience. Perhaps if there were more attorneys whether there was a need for tariffs. One
Professor Jonathan Bloom presented and advocates in the country offering al- view was that it was helpful to have a tar-
a report on behalf of the South African ternative services, it would increase com- iff because it promotes uniformity and
Board for Sheriffs detailing a tariff over- petition which would in turn drive down gives a degree of certainty to litigants as
view of the past decade. He also present- prices and make access to justice more they will know how much they are ex-
ed a financial model on adjustments to accessible. This is something the Justice pected to pay in advance. He added that
future tariff increases. Department must take up. They must it could also help bring the cost down
think of ways of having more graduates for the losing party. The other view was
Resolutions involved in new areas of legal services that tariff recovery fees were not neces-
The delegates then divided into four within the civil justice system’ he said. sary and would not provide any benefit
groups for the breakaway session. The KwaZulu-Natal attorney and member to the litigant. ‘There was a strong sense
groups discussed the following – of the Rules Board, Thoba Poyo-Dlwati that access to justice might be better en-
• group one: sustainability of costs in the spoke on behalf of group 2. She said that hanced as the successful party could re-
context of access to justice; her group resolved that the application cover their cost as much as possible and
• group two: the structure of the tariff of the tariffs different version of taxa- a tariff would not necessarily enhance
and increases in the tariff for attorneys tion] in the country needed to be harmo- that,’ he said.
in the Supreme Court of Appeal, High nised because it was currently not uni- Speaking on the structure of the tar-
Court and Magistrates’ Courts; formly applied in the provinces across iff, Mr Farlam said that there was gen-
• group three: the structure of the tar- the country. eral consensus that there should not be a
iff and increases in the tariff for sheriff Her group also said that tariff in- fixed fee or fixed amount. Instead, there
in the High Court and the Magistrates’ creases should take place annually and should be some sort of range that would
Courts; and should be based on the consumer price take into account the nature of the mat-
• group four: tariff for taxation of ad- index but that the tariffs needed to be ter, the seniority and experience of the
vocates’ fees in the Supreme Court of reviewed every three years. advocate as well as the regional differ-
Appeal, High Court and the Magistrates’ On the issue of how to calculate dis- ences as advocate fees differ in the dif-
Courts. bursements group 2 said that a dis- ferent parts of the country.
Professor at the University of Cape bursement was a recovery of what one Mr Farlam said that there was a unani-
Town and Rules Board member, Moha incurred, so one must recover what one mous decision in his group that advocate
med Paleker said that group 1 believed has incurred. fees are time based and not item based.
that in an ideal world the burden of en- Ms Poyo-Dlwati said that for the cal- To view the submissions made at the
suring that everyone has access to jus- culation of disbursements, the AA rates costs indaba, go to http://www.justice.
tice should principally fall on the state or the national treasury guides should gov.za/rules_board/2014indaba.html
as the Constitution talks about access be used for travelling cost calculations
to the courts (s 34) and that everyone is as well the rates charged by various cell
equal before the law (s 9). ‘So in an ideal phone providers for cellular calls and
world the state should offer assistance that these rates should be provided to
to anyone who finds themselves needing the taxation officials.
to go to court,’ he said. Group 2 resolved that the tariff struc-
Mr Paleker added that we are not living ture for the Magistrates’ Courts, High
in an ideal world and that we need to be Court and Supreme Court of Appeal
realistic. He said that the state has lim- should be retained.
ited resources and that these resource Cape Town attorney and Rules Board Nomfundo Manyathi-Jele,
constraints required creative and new member Graham Bellairs gave group 3’s [email protected]
thinking. Mr Paleker added that before resolutions. He said that there is an ur-
one can even talk about legal fees and the gent plea by the sheriffs that travelling q

- 15 -
LSSA NEWS
Compiled by Barbara Whittle, communication manager, Law Society of South Africa, [email protected]
Legal Practice Bill passed

and awaiting Presidential assent
T
he Legal Practice Bill was Department of Justice and Constitution- • One teacher of law designated by the
passed by the National Assem- al Development to offer its support to South African Law Deans Association.
bly on 12 March 2014 and was the Department in setting up a steering • Two persons designated by the Minis-
sent to the office of the State committee to start working on the road- ter of Justice and Constitutional Devel-
Legal Adviser for final con- map for the transitional process. The opment.
stitutional scrutiny. This was expected Department is responsible for the costs, • One person designated by Legal Aid
to be completed during April 2014 and infrastructure and staffing of the NFLP. South Africa.
the President was expected to assent to However, the understanding is that the • One person designated by the Board of
the Bill before the national elections on profession itself will be expected to take Control of the Attorneys Fidelity Fund.
7 May. This would then signal the start responsibility for the work and negotia- Within two years, the NFLP must make
of the transitional process, which will be tions of the NFLP, which will be in exist- recommendations to the Minister on the
steered by the National Forum on the Le- ence for a period of three years. following:
gal Profession (NFLP). • An election procedure for purposes of
After provincial legislature briefings The NFLP constituting the National Legal Practice
held in February 2014, on 5 March the Council.
National Council of Provinces (NCOP) In terms of the Bill, the NFLP will have • The establishment of the provincial
voted on the Bill, which had minor tech- 21 members, 16 of whom are legal councils and their areas of jurisdiction.
nical amendments, and passed it with practitioners: • The composition, powers and func-
five provinces voting in favour, one ab- • Eight attorneys designated by the LSSA: tions of the provincial councils;
staining and the Western Cape legisla- – Two representing the Black Lawyers • The manner in which the provincial
ture objecting. A s 76 Bill, as the Legal Association. councils must be elected.
Practice Bill was tagged, requires a mini- – Two representing the National Associa- • All the practical vocational training
mum vote by five provinces. The Law tion of Democratic Lawyers. requirements that candidate attorneys
Society of South Africa (LSSA) made writ- – Four representing the four statutory or pupils must comply with before they
ten and oral submissions at the provin- provincial law societies. can be admitted by the court as legal
cial hearings (see 2014 (Mar) DR 3). The • Eight advocates: practitioners.
Democratic Alliance issued a statement – Five designated by the General Council • The right of appearance of a candidate
on 12 March indicating that, in its view, of the Bar. legal practitioner in court or any other
the passage of the Bill through the NCOP – One designated by the National Bar institution.
had been procedurally incorrect as one Council of South Africa. • A mechanism to wind up the affairs of
of the five provices, Gauteng, did not – One advocate designated by the Na- the NFLP.
have a valid mandate. tional Forum of Advocates. • Prepare and publish a code of conduct.
Also on 12 March 2014, the LSSA’s – One advocate designated by Advocates
management committee met with the for Transformation.
LSSA to launch election observer team

to observe the national elections
S
ome 500 attorneys and candidate attorneys have the voting and counting processes, as well as being present
made themselves available as volunteer observers at the national results centre. LSSA observers will report
for the national elections on 7 May. The Law Soci- their findings and the LSSA will draft a report to the Inde-
ety of South Africa (LSSA) registered as an observer pendent Electoral Commission.
body for the national elections and invited attorneys and Observers will receive a full-day training workshop pro-
candidate attorneys to join the LSSA observer team. vided free of charge by the LSSA, with the support of Lexis-
In terms of its election manifesto, the LSSA indicated Nexis, to equip them to assess the electoral process with a
its support for the national elections in the spirit of the particular emphasis on compliance with regulations, laws,
founding values of the Constitution, which espouse the procedures and codes of conduct. They will also be able to
supremacy of the Constitution and the rule of law, as evaluate the participation of citizens and their understand-
well as universal suffrage, a national common voters’ roll, ing of the processes. This will contribute to ensuring free
regular elections and a multi-party system of democratic and fair elections.
government to ensure accountability, responsiveness and • Further information on the LSSA election monitoring proj-
openness. ect can be accessed on the LSSA website at www.LSSA.org.
The LSSA believes that independent legal practitioners za
will ‘serve as the eyes and ears of citizens’ by observing

- 16 -
Norton Rose
Fulbright
and Lankalebalelo
Attorneys in
LSSA Synergy Link
N
orton Rose Fulbright has en-
tered into a Law Society of
South Africa (LSSA) Synergy
Link agreement as a transferring
firm with Lankalebalelo Attorneys,
as the growing firm, to transfer rel-
evant skills to assist the growing firm
to explore and develop new areas of
practice, as well as providing advice
and support on business and man-
agement related aspects.
Lindie Langa of Lankalebalelo

Attorneys, centre, with Rob Otty
and Sbu Gule respectively,
Managing Director and Chairman
of Norton Rose Fulbright South
Africa.
Tailored specifically for you
One size doesn’t have to fit all.

Ensure you always have a competitive edge by empowering your team to make the best decisions possible.
Sign up for Legal Select and give everyone in your practice access to the latest, most accurate authoritative
legal content in the country on LexisNexis’ leading research platform - MyLexisNexis.
A comprehensive range of online resources customised to your specific needs and budget.
For more information, visit www.lexisnexis.co.za/legalselect
Legal Select
OL0000/14

- 17 -
People and practices
Compiled by Shireen Mahomed
Durban-based law firms Van Velden Pike Inc and Nichols Attorneys have mergered. The new law firm will be known as
Velden Pike Nichols Inc (VPN Law) and will offer legal services in the areas of maritime law, logistics, ports and terminals,
marine and non-marine insurance (including professional indemnity), constitutional, and related corporate and commer-
cial law. Standing, from left: Mark van Velden (director), Berning Robertson (associate), Andrew Pike (director) and Nicola-
Ann Nel (associate).
Seated, from left: Trudie Nichols (director), Lauren Turner (associate), Mark Kmelisch (associate), Norma Wheeler (as-
sociate) and Anisa Govender (director). Absent: Goscelin Gordon (associate).
Garlicke & Bousfield in Durban has one Werksmans Attorneys has the follow- Cliffe Dekker Hofmeyr in Johannes-
new appointment and one promotion. ing new appointments: burg has two new announcements.
Kabby Esat has Peter Mason Attie Pretorius has

been appointed joined Werksmans been promoted to
as a director in Attorneys as a chairman from April
the commercial director in the 2014. He has been a
department. banking and director at the firm
finance since 1984.
department.
Megan Gedye has Jason Smit was Chris Ewing will

been promoted appointed in the retire as a partner
to an associate firm’s construction but will continue
in the litigation and engineering to serve as a
department. law department mentor and adviser
and will also lend to young lawyers
his expertise to at the firm.
general litigation.
Fairbridges in Cape Town has three new appointments.
Lalena Posthumus, Lebona Khabo has Blair Wassman has

has been appoint- been appointed as been appointed in
ed as an associate an associate in the the litigation and
in the commercial litigation depart- labour law depart-
department in ment in Cape ment in Johannes-
Cape Town. Town. burg.

- 18 -
PEOPLE & PRACTICES
Adams & Adams in Pretoria has seven new partners. Venashrie Mannar
has been appointed
Nicolette Biggar Jessica Axelson has in the commercial,
has been appoint- been appointed in property and litiga-
ed in the trade the trade marks tion department at
marks department department at the the Pretoria office.
at the Pretoria Cape Town office.
office.
Rooth & Wessels

Inc in Pretoria has
Andrew Molver Jani Cronje has
appointed Marco
has been been appointed in
Schepers as a pro-
appointed in the the trade marks
fessional assistant
commercial, prop- department at the
in its commercial
erty and litigation Pretoria office.
department.
department at the
Pretoria office.
Please note: Preference will

Jean-Paul Rudd Wilhem Prozesky
has been has been appointed be given to group photo-
appointed in the in the patent graphs where there are a
commercial, prop- department at the number of featured people
erty and litigation Pretoria office. from one firm in order to
department at the
try and accommodate eve-
Pretoria office.
ryone. q
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- 19 -
PRACTICE NOTE
Common law right

to claim interest
By
Siyonwaba Mviko
and
Victor Mxolisi
Mndebele
D
amages that flow from bank was entitled to levy mora interest ment of a monetary obligation under a
the failure to make pay- on unpaid but due and payable inter- contract, his creditor is entitled to be
ment timeously have re- est. The High Court found that ‘in the compensated by an award of interest for
cently been the subject of absence of agreement to that effect, the the loss or damage that he has suffered
debates in the Supreme appellant was not entitled to interest on as a result of not having received his
Court of Appeal (SCA). unpaid interest’ and gave judgment for money on due date’ (at para 14).
As a result thereof, a number of princi- the respondent (at para 10). A party who has been deprived of the
ples emanating from a creditor’s right to On appeal, the SCA held that mora in- use of capital for a period of time suf-
claim interest have been formulated in a terest constitutes a form of damages for fers a loss and must be compensated
number of reported cases. breach of contract and ‘the general prin- by an award of interest. If the contract
Certain of the principles include the ciple in the assessment of such damages fixes the time for payment, no demand is
following: is that the sufferer by the breach should necessary to place the debtor in default
• If a debtor is late with payment of a be placed in the position he would have and interest is payable from the date
money obligation under a contract, the occupied had the contract been per- on which payment was due. If the con-
creditor is entitled to claim mora inter- formed’ (at para 13). tract does not include an express or tacit
est on the outstanding debt due to the Due to the fact that interest is the ‘life- statement of the date when payment is
debtor’s failure to make payment on the blood of finance’ and that tardy payment due, a demand for payment within a rea-
due date. of monetary obligations will almost in- sonable time must be sent before inter-
• The creditor is entitled to claim this variably deprive the creditor of the pro- est starts accumulating.
interest even without a specific contrac- ductive use of the money and thereby
tual provision to pay interest. cause him or her loss (at para 13). Ac- Conclusion
• If the contract fixes the time for pay- cordingly, it is in the public interest that
ment, no demand is necessary to place creditors be compensated when debtors Mora interest constitutes compensation
the debtor in default and interest is pay- fail to make payment of agreed interest for loss resulting from a breach of con-
able from the date on which payment on the due date (at para 19). tract and is not governed nor depend-
was due. Unless specifically excluded in a con- ant on an agreement. Mora interest is a
In Land Agricultural Development tract, mora interest automatically flows common law right, meaning that it au-
Bank of South Africa v Ryton Estates from the breach of contract. tomatically applies to contracts unless
(Pty) Ltd and Others [2013] 4 All SA 385 Because mora interest represents dam- it is expressly, plainly and unambigu-
(SCA), the appellant (the bank) advanced ages, the rate thereof is not determined ously excluded by agreement between
and lent monies to several commercial nor governed by agreement or in any the parties. If a contract or agreement
farmers (the respondents or borrowers). other manner. Mora interest is payable is silent on the rate of interest, then in-
The loans were all secured by mortgage at the prescribed rate, which currently is terest can be claimed at the prescribed
bonds. Each loan agreement provided 15,5%, and is determined by the Minister rate of 15,5%. Mora interest can only be
that interest at a stipulated annual rate of Justice, from time to time, in terms of claimed at the prescribed rate. The same
would be calculated on the balance of s 1(2) of the Prescribed Rate of Interest principles apply equally to a debtor who
the capital outstanding from time to Act 55 of 1975, as amended. is in default in respect of a contractual
time. The court found in favour of the bank, obligation to pay interest.
In terms of each loan agreement, the determining that in the absence of a
loan and interest was repayable in equal clear and an unambiguous agreement to
instalments annually in arrears (at para the contrary, mora interest is payable at
4). The date on which each instalment the prescribed rate on any unpaid inter-
was due and payable was fixed by agree- est that is due and payable. Siyonwaba Mviko BCom LLB (UJ)
ment. It was common cause that, in In an earlier judgment, Crookes Broth- is a candidate attorney and Victor
many instances, the respondents did not ers Limited v Regional Land Claims Com-
Mxolisi Mndebele LLB (Wits) is an
pay their instalments on the due dates. mission for the Province of Mpumalanga
attorney at Poswa Inc in Johannes-
After all the loans were repaid, the re- and Others [2013] 2 All SA 1 (SCA), the
spondents instituted action against the SCA held: ‘Even in the absence of a con- burg.
bank on a number of grounds. In this ar- tractual obligation to pay interest, where q
ticle we will focus only on whether the a debtor is in mora in regard to the pay-

- 20 -
Having a hunch –
tapping into DR P MILLER
your senses MB BCh (Wits) FRCS (Edin)
By
Louis
Rood
SnR nEuRoSuRgEon
L
awyers like to think believe in what we are doing.
that they are guided That belief is often intuitive.
Practice No. 2400871
by logic, reason and What about the risks in-
facts. But does that volved in relying on your intu-
process always lead ition? Taking risks is part and
to the truth? It is good to be parcel of remaining dynamic,
sensible, rational and objec- effective and competitive in
tive, but is it enough?
Intuition is something
a constantly and ever more
rapidly changing business
Po Box 890289
that some people have often environment. You will never
derided as some sort of ir- have all the facts and options Lyndhurst 2106
rational, emotional fantasy, available before taking a deci-
which at best is patronisingly
tolerated as a harmless form
sion. You have to rely on your
instincts, your experience and
Vat Reg 4830108892
of foolishness. However, in your sound common sense
a world where decisions fre- and you have to ensure that
quently have to be made un- you have identified the risks
der severe time constraints you are taking.
and with tight budgets and Being alert to opportunities
limited information, more
lawyers are having to trust
that may arise, despite the risks
that go hand-in-hand with such
going into full time
their gut feeling or intuition.
There are two very impor-
opportunities, means that you
never become complacent or
Medico-legal practice
tant components with regard bogged down in your comfort
to intuition: Listening to intu- zone. You are able to continually
ition and then trusting it. This review the effectiveness, viabil-
trust develops over time and ity and desirability of your ap-
is based on experience gained proach. You can never improve
– namely, that your acute per-
ception, shrewd observation
unless you are open to change.
The greatest risk is often in fail-
25 Years experience with
and your feel for what sounds
right can indeed be relied on
ing to take those opportunities:
If you stay in the middle of the
Medico-legal
to be accurate. road, you will get run down.
When you develop the self- Risk-taking is often nec-
confidence to have faith in essary in trying to develop
what your instincts tell you, a competitive advantage in
this can enhance your profes- the market place. If you have
sional judgement, and give
you an edge over more stodgy
sound policies, goals and
strategies, you can build up
Expert and third party
bean-counters.
Intuition does not mean
a compelling momentum in
how you manage and imple-
reports from 20-3-2014
excluding facts and data; it ment change and, in that way,
means adding another pow- minimise the risk. Success is
erful source of knowledge. not for the faint-hearted; in
If you rely only on verifiable order to succeed, you need
information – for example, fi- to take calculated risks. It is
nances, structures and proce-
dures – you remove emotion,
only with risks that you get
rewards.
Telephone bookings:
instinct and the ability to
evolve, invent and innovate. 082 566 3242
You disconnect yourself from
your best instruments for
adaptability – namely, creativ-
Louis Rood BA LLB (UCT) Res: (011) 882-2705
is chairman of Fairbridges
ity and inspiration. We per-
form best if we passionately
in Cape Town. q

- 21 -
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PRACTICE MANAGEMENT
By
Simthandile
Have you paid your dues?
Kholelwa
Myemane
S
ection 78(3) of the Attorneys Act 53 to the AFF on time. In terms of the Fideli- registered practitioner will claim VAT in-
of 1979 obliges practitioners to pay ty Fund certificate (FFC) issued on behalf clusive of bank charges. Table 1 (below)
any interest earned on deposits in of the AFF by the practitioner’s statutory is an illustration of how VAT registered
trust accounts in terms of s 78(1) and (2) law society, which enables an attorney to and non-registered practitioners will de-
over to the Attorneys Fidelity Fund (AFF). practise for his or her own account, the termine the net interest that needs to be
The AFF has, at its discretion, allowed interest earned annually up to the last paid.
the following in this regard: day of February each year should be paid Practitioners must reclaim the cost
Practitioners may deduct 100% of the to the law society by 31 May of that year. of their trust audit fees from the AFF.
allowable bank charges incurred on the An automated monthly transfer sys- The current audit fee refund formula re-
s 78(1) funds and pay over the net in- tem, whereby the banks automatically quires:
terest to the AFF. However, if the bank transfer the interest over to the law soci- • A minimum contribution of R 3 000 per
charges incurred exceed the interest eties for further pay-over to the AFF, can firm.
earned on the s 78(1) funds, the practi- be used by practitioners. This system • A maximum contribution of 20% of net
tioner bears the cost. does not take the responsibility away trust interest.
The AFF advises practitioners of al- from the practitioner to ensure correct These reclaims, for both bank charges
lowable deductibles and the following payment; it still remains the duty of the and trust audit fees, are subject to the
charges are currently disallowed: practitioner to ensure that the correct practitioner complying with the prefer-
• Unusually high cash deposit fees. interest is paid. Should the practitioner ential banking arrangements for trust
•Charges regarding issuance of bank realise that the bank passed on disal- banking accounts, as shown on the
guarantees. lowed bank charges, it is the responsibil- AFF’s website (www.fidfund.co.za) under
• Forex transaction fees. ity of the practitioner to pay the amount ‘banking options’ and sufficient trust in-
• Non-payment bank charges fees. involved. terest being generated by a firm to de-
• Fees in relation to the issue of interim In determining how much of the bank fray such bank charges.
bank statements. charges to offset against earned inter-
• Special clearance charges. est, a value-added tax (VAT) registered
It is the responsibility of practitioners practitioner will reduce the claimed bank
to ensure that the correct interest is paid charges by the VAT portion, while a non-
Type of firm Interest earned VAT inclusive VAT portion Bank charges Net interest
bank charges deducted reclaimed paid
(allowable)
VAT registered R 8 956,78 R 1 956,32 R 273,89 R 1 682,44 R 7 274,35
VAT non-registered R 8 956,78 R 1 956,32 Nil R 1 956,32 R 7 000,46
Table 1: An illustration of how VAT registered and non-registered practitioners Simthandile Kholelwa Myemane BCom
will determine the net interest that needs to be paid. Dip Advanced Business Management
(UJ) Cert Forensic and Investigative Au-
diting (Unisa) is a lead forensic investi-
gator at the A
ttorneys Fidelity Fund in
Centurion.
q

- 23 -
Sugar-coating guilt
Admission of guilt fines – no easy fix
Picture source: Gallo Images/Thinkstock
By
Dr Llewelyn
Curlewis

- 24 -
FEATURE
T
he Western Cape High Court always properly understood. In laymen’s nal Procedure Matters Amendment Act
delivered a judgment in the terminology and also in legal jargon, the 109 of 1984 and by s 6(a) of the Criminal
matter of S v Tong 2013 (1) words ‘admission of guilt’, sounds per- Procedure Amendment Act 5 of 1991)
SACR 346 (WCC) on 7 Sep- fectly descriptive, but this view would or where a written notice under s 56 is
tember 2012. The matter amount to seeing only the tip of the ice- handed to the accused.
related to a case where the berg. The aim of this article is not to dis-
appellant (Tong) paid an admission of It is foreseeable that practitioners courage the payment of admission of
guilt fine in November 2008 after he had will come under fire in future because guilt fines in meritorious cases. Rather,
been arrested on a charge of possession of these sections. This may even entail it serves as a warning signal, suggest-
of dagga in contravention of s 4(b) of a possible claim for malpractice, due to ing a cautious approach to beg recon-
the Drugs and Drug Trafficking Act 140 the hasty acceptance of an admission sideration by those practitioners and/or
of 1992 and was subsequently released of guilt fine (in the trend of following members of the public with an attitude
from custody. old habits), without carefully explaining of: I would rather pay an admission of
In 2011, Tong discovered that he had a and/or considering all the concomitant guilt fine of R 1 000 now than try and
criminal record as a result of the posses- effects of such acceptance. Such a claim convince a court of my innocence in a
sion charge in 2008. The criminal record may possibly even arise from a failure lengthy, frustrating and costly court case
severely prejudiced him and limited his to advise a client against paying the fine later.
employment opportunities. Tong alleged in certain circumstances. An admission The payment of an admission of guilt
that he had not been afforded an oppor- of guilt fine is very often considered a fine is based on the fact that an accused
tunity to present his defence in court or quick fix, an easy way out, or a short-cut would be fully appraised of his or her
to adduce evidence in his defence and conclusion by defence practitioners and rights and the consequences thereof be-
stated that he would have elected to de- prosecutors alike, where it might – in fore electing to do so. By electing to pay
fend the charge leveled against him had fact – represent a significant threat. the admission of guilt fine, an accused
he known of the implications of paying It is well argued that ss 57 and 57A waives a number of procedural rights
the admission of guilt fine. (inserted into the CPA by s 1 of the Crim- that he or she would have had at a trial
In an article, entitled: ‘Section 57 inal Procedure Second Amendment Act (including the right to be sentenced only
and 57A of the Criminal Procedure Act 85 of 1997), are for the benefit of both after proof beyond reasonable doubt
51 of 1977 – use them with discretion’ the justice system and the individual that he or she did in fact commit the
2008 (Apr) Society News, no 124 at p 8, since they reduce overburdened court offence, the right to confront his or her
I warned against the short-sighted, irre- rolls, relax the stringent and non-user accusers and the right to call witnesses,
sponsible and sometimes ill-considered friendly adversarial court process and etc).
payment of admission of guilt fines generally cut to the chase. The payment of admission of guilt
purely for the sake of expediting and fines is undoubtedly an important com-
finalising criminal proceedings, that is, ponent of the criminal justice system, as
basically using it as a nonchalant quick-
fix method. Practitioners should not be
‘An admission of it affords the opportunity to admit guilt
for less serious offences and relieves the
confused by the sometimes artificial ad- guilt fine is very burden on the overloaded criminal jus-
vantage created by these sugar-coated tice system. However, the payment of an
sections. often considered admission of guilt fine may and should
Section 56(1) of the Criminal Procedure
Act 51 of 1977 (CPA) provides that, if a
a quick fix, not be used as a bargaining tool by the
South African Police Service (SAPS) to
peace officer on reasonable grounds bean easy way out, effect the release of a person from cus-
lieves that a magistrate’s court will not, tody. I submit that such an approach is
on conviction for that offence, impose a or a short-cut unlawful.
fine exceeding an amount determined in
the Government Gazette by the Minister
conclusion In the Tong judgment, the court held
that the accused person must be in-
of Justice and Constitutional Develop-
ment, he or she may issue a notice to
by defence formed and warned by the police officer
serving the notice that, should he or she
the accused to pay an amount specified practitioners and elect to pay the admission of guilt fine,
by the peace officer. Section 56(1)(d) of
the CPA requires that the written notice prosecutors alike, a conviction will be noted against his or
her name. As a result, the court held that
must, inter alia, contain a certificate
by the peace officer that he or she has
where it might – the existing written notice usually used
(J 534 form) is inadequate and may not
handed the original written notice to the in fact – represent pass constitutional scrutiny.
accused and explained the importance of
the notice to the accused. a significant The existing J 534 form does not
mention the constitutional rights of an
If an accused elects to pay an admis-
sion of guilt fine on being issued a writ-
threat.’ accused person, which must be high-
lighted and a police officer or attorney
ten notice in terms of s 56 of the CPA, must surely warn the accused about the
s 57 of the CPA will also apply, and the Section 57 provides for the admission criminal record that he or she will have
accused may admit his or her guilt with- of guilt in respect of the offence and for as a result of the decision to pay the ad-
out appearing in court by paying the fine the payment of a stipulated fine without mission of guilt fine. The court further
stipulated on the written notice. Once appearance in court. Section 57A, on held that the existing J 534 form must
the admission of guilt fine is paid by the the other hand, provides for the admis- be amended to include this warning, and
accused, the particulars of the accused sion of guilt and the payment of a fine, that the accused must also be informed
are recorded as a criminal record and the after appearing in a court but before the that he or she will be waiving –
accused is deemed to have been convict- accused has entered a plea in terms of • the right to be sentenced only after the
ed and sentenced by the court in respect s 106 of the CPA. state has proved his or her guilt beyond
of the offence concerned. Section 57 may be used where a sum- reasonable doubt;
The practical implications of these mons is issued under s 54 (s 57(1)(a) has • the right to contest the allegations in
sections of the CPA, as amended, are not been substituted by s 3(a) of the Crimi- an open court, to call witnesses; and

- 25 -
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FEATURE
• sometimes also the right to legal repre– • By paying the admission of guilt fine, In the case of a police officer, a SAPS
sentation. he or she will be deemed to have been member should make an entry in his or
In order to comply with the abovemen- convicted in court of the offence (with- her pocket book, stating the information
tioned judgment, the SAPS recently draft- out having appeared in court, having had as set out above, and record that the ac-
ed an amended J 534 form. However, it the benefit of facing his or her accuser, cused person has accordingly been in-
is important to note that the J 534 form having had legal representation or hav- formed thereof. I suggest that attorneys
is an official form of the Department of ing exercised the right to call a witness should also record this in their file and
Justice and Constitutional Development in an open court) and that the conviction even require the client to sign a docu-
and, as such, the SAPS is apparently not will be recorded as a previous conviction ment as proof that he or she was in fact
in a position to amend the form with- against his or her name and will appear informed.
out the permission of that department. on his or her criminal record.
According to a memorandum by the Where the accused person is repre-
National Police Commissioner, Riah Phi- sented by an attorney, the obligation to
yega, dated 12-4-2013, consultations are explain the above-mentioned informa-
Llewelyn Gray Curlewis LLM (Unisa)
currently taking place with the depart- tion is placed on the legal representative.
BLC LLD Cert Forensic Accounting
ment on the amended J 534 form. As explained above, it is a loaded burden
(UP) is an attorney at Pieterse & Cur-
In the meantime, it is important that a resting on such person.
lewis Inc in Pretoria. Dr Curlewis is
member of the SAPS must inform an ac- In a number of cases I have recently
the president of the Law Society of
cused who is not legally represented and been involved in, the client (the accused)
the Northern Provinces, a member
to whom a J 534 form is issued, of the elected to follow the review application
of its criminal law committee and,
following information: route (similar to the Tong case) and
vice-chairperson of the criminal law
• If the person chooses to pay the admis- elected to hold the former attorney, who
committee of the Law Society of
sion of guilt fine, he or she acknowledges had initially advised the client to pay the
South Africa.
that he or she is guilty of the offence(s) admission of guilt fine (without explain-
(as stated on the J 534 form that is hand- ing the consequences), accountable for
q
ed to the accused). damages and costs.
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- 28 -
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We have our place. They have theirs. Visit nspca.co.za for more about the hazards of capturing and breeding exotic animals.
Merger and takeover law

Impact on private companies By Basil
Mashabane

- 30 -
FEATURE
enormous changes to the way mergers and selling of shares, business transac-
and takeovers are regulated in South Af- tions or other corporate activity events
rica. There is no denying, however, that necessitating the involvement and/or
there exists a number of uncertainties on intervention of a regulator such as the
a few issues pertaining to the Act and its Takeover Regulation Panel to ensure
application to mergers and takeovers. that the rights of the company’s minor-
ity shareholders are protected.
Application of mergers What is clear however, is that the ma-
and takeover laws on jority of the matters involving private
private companies companies that the Takeover Regulation
Panel (the panel) deals with involve fairly
The main subject of this article is one of
small private companies in which share-
the major changes that the law has intro-
holders range between two and ten in
duced that has caused some consterna-
number. These shareholders are usually
tion in business but, at the same time,
party to the sale of shares or disposal
appears to be enjoying support among
of assets agreements being entered into
the stakeholders it is meant to protect,
and would proceed with these agree-
namely the minority shareholders in
ments unhindered, except when a pri-
companies. The change relates to the
vate company entered into a transaction
application of the Act and the takeover
in the past 24 months in which shares
regulations to private companies regis-
exchanged hands, resulting in it being
tered under South African law.
regulated and therefore required to com-
The merger and takeover provisions
ply with certain statutory requirements
of the Act apply to regulated companies
before concluding and implementing the
only and s 118(1) of the Act lists and
particular sale of shares or disposal of
defines three types of regulated compa-
assets agreement with another party.
nies, namely –
These statutory requirements that a
• public companies (listed or unlisted); private regulated company is required to
• state-owned companies (unless exemp meet include the preparation of a circu-
ted); and lar in terms of the regulations with the
• private companies. purpose of fully explaining and disclos-
Under s 118(1)(c) of the Act a private ing to shareholders all the aspects of
company is regulated only if – the merger or takeover transaction or
‘(i) the percentage of the issued secu- agreement that the company is involved
rities of the company that have been in and to also prepare an independent
transferred, other than by transfer be- expert report (at its expense) for a valua-
tween or among related or inter-related tion of the company’s shares or assets in
persons, within the period of 24 months order to determine, for the benefit of the
immediately before the date of a particu- shareholders, whether the offer to ac-
lar affected transaction or offer exceeds quire the shares or to effect the disposal
the prescribed percentage in terms of of the company’ assets, is fair or unfair
subsection (2) or; to the shareholders of the company.
(ii) the Memorandum of Incorporation An argument could be made that the
of that company expressly provides that only rationale for regulating mergers
the company and its securities are sub- and takeover transactions involving pri-
ject to this Part, Part C and the Takeover vate companies is to protect sharehold-
Regulations, irrespective of whether the ers regardless of the number of share-
company falls within the criteria set out holders that are involved and whether or
in subparagraph (i).’ not the shareholders are fully in support
For a private company to be regarded of the merger or takeover transaction.
as regulated, certain steps must have The question therefore becomes wheth-
taken place and this stems from the re- er it is proper and rational for these
alisation that private companies are by provisions to exist, taking into account
nature, small and tightly held business the nature of private companies and the
T
entities and, to a large degree family transactions regulated by South African
controlled, making it easy for the parties merger and takeover law.
his is a follow-up to the
to reach agreement on major issues re-
article ‘Mergers and
takeovers under the
lating to the company and its business, Exemption of private
new Companies Act’
such as acquisitions and/or transfer of companies
the business of the company.
(2011 (Sept) DR 30) In recognition of what could at times ap-
where I discussed the Rationale for the pear to be an absurdity, the drafters of
fact that South African the Act and the regulations had the fore-
mergers and acquisi-
application of the Act to sight to include a provision in the Act
tions are experiencing a paradigm shift private companies to the effect that the panel has powers
following the enactment and implemen- It could be argued that the Act therefore to grant an exemption to an offerer to
tation of the new Companies Act 71 of envisages that a private company, which an affected transaction to an extent that
2008 (the Act) on 1 May 2011, replacing is regulated, would be a large company doing so is not prejudicial to the inter-
the old order. with a sizeable number of shareholders est of any party to the transaction; that
The Act has been in existence almost and with sizeable corporate activity tak- the cost of compliance is disproportion-
three years and it has already brought ing place, including entering into buying ate to the value of the transaction or that

- 31 -
ADVERTORIAL
INDEPENDENT REGULATORY BOARD FOR AUDITORS

COMMITTEE FOR AUDITING STANDARDS
Guide for Registered Auditors: Engagements on Attorneys Trust Accounts
This Guide for Registered Auditors: Engagements on Attorneys Trust Accounts (this Guide) was
prepared by a Task Group of the Committee for Auditing Standards (CFAS) of the Independent Regula-
tory Board for Auditors (IRBA) which comprised auditors and representatives of the Law Society of South
Africa, the Provincial Law Societies, and the Attorneys Fidelity Fund.
This Guide was approved for issue in February 2014 and replaces the previous SAICA Guide, namely
"Guidance for Auditors: The Audit of Attorneys' Trust Accounts in terms of the Attorneys Act, No 53 of 1979,
and applicable Rules of the Provincial Law Societies" that has been withdrawn. The auditors' reasonable
assurance report replaces the Attorneys Trust Account - Revised Transitional report issued in August 2008
that is similarly withdrawn.
Guidance is provided to registered auditors in the special circumstances applicable to engagements on at-
torneys trust accounts as required by the Attorneys Act, No 53 of 1979 and Rules of the relevant Provincial
Law Society (the Act and the Rules), including an auditor's responsibility to report a reportable irregularity.
This Guide is also relevant for attorneys in understanding the nature of the engagement, and the respec-
tive responsibilities of the parties. This Guide has been prepared on the basis of the present Rules of the
respective Provincial Law Societies and will be updated when the Law Society of South Africa's proposed
Uniform Rules are approved and issued
There is an expectation by the Attorneys Fidelity Fund, the Law Societies, financial institutions, attorneys'
clients and members of the public, that auditors of attorneys trust accounts will detect fraud and theft,
whereas the main purpose of an engagement on an attorney's trust accounts is for the auditor to evaluate
the compliance of attorneys trust accounts with the Act and Rules. Accordingly the Guide contains special
considerations applicable to fraud and theft in the circumstances of engagements on attorneys trust ac-
counts.
The Attorney's Annual Statement on Trust Account contains the attorney's compliance representations to
the relevant Provincial Law Society, and information extracted from the trust accounting records previously
dealt with in the auditor's report. The Attorney's Annual Statement on Trust Accounts is to accompany the
auditor's report.
Effective date
The Attorneys' Trust Guide is effective for engagements commencing on or after 1 March 2014.
Early adoption is permissible.
The Attorneys' Guide is available in both PDF and Word formats and may be downloaded free-of-charge
from the IRBA website at www.irba.co.za/index.php/auditing-standards-functions-55/92?task=view.
Should you have any further queries or experience any technical difficulties in downloading the documents
please do not hesitate to contact the Standards Department at +27 (0)87 940 8800 or send an email to
[email protected].
- 32 -
doing so (ie, granting the exemption) offerer and the party applying for the ex- not difficult to satisfy if and when ad-
would be both reasonable and justifi- emption would also be required to attach hered to and, lastly, that the panel has
able. waiver letters from shareholders in the not abrogated its role and still ensures
Based on the nature of private compa- regulated company in which the share- that it plays its regulatory role and func-
nies and the type of transaction entered holders indicate that they are aware of tion with the same amount of interest
into by these companies, the panel con- the offerer’s obligations to comply with and close inspection as it would when it
tinues to be inundated with applications the provisions of the Act and the take- deals with a major takeover transaction
for exemptions from legal practitioners over regulations on mergers and take- for purposes of ensuring that the inter-
acting for these companies requesting overs, but that they are prepared to al- ests of shareholders are protected.
that the parties involved in these trans- low the offerer to obtain an exemption It should never be taken for granted
actions be exempted from compliance through them waiving their rights. that a large number of small businesses
with the provisions of the Act and the Lastly, the waiver letters must be in South Africa have been incorporated
takeover regulations. signed in original form by all the share- as private companies and most of them
The fact that the panel is, under cer- holders in the regulated company in or- acquire their legal services from small
tain circumstances, allowed to provide der for the application to be considered. and medium-sized law firms.
an exemption from its requirements It has been my experience over the
should not create the impression that the Conclusion years at the panel that practitioners
panel has become a rubber stamp and There is a prevailing argument in some in these firms hardly get exposure to
fortuitously grants exemptions to par- quarters that the application of the Act merger and takeover law work and these
ties involved in transactions with these and the regulations to private companies changes to the law will inadvertently en-
regulated companies, particularly where, is cumbersome and to some extent un- sure that these practitioners are exposed
at face value, it appears that granting an necessary, taking into account the nature to the world of mergers and acquisitions
exemption would be correct thing to do. of the majority of private companies reg- as they provide advice to their clients,
This is certainly not the case when one istered in South Africa. However, there is albeit that these changes were not moti-
considers that the panel would still re- a counter-argument that the provisions vated by the desire to create more work
quire a letter from the parties applying apply to select private companies meet- for practitioners but to simplify the law
for the exemption detailing the nature ing certain requirements as prescribed and to also enhance shareholder protec-
of the transaction, explaining the ba- only and it is indeed in these companies tion.
sis on which the company is regulated, where such application of the require-
taking into account s 118(1)(c), together ments would be necessary. Basil Mashabane LLB (UP) LLM Cer-
with a motivation as to why an exemp- Further, and in support of the coun- tificate in Advanced Corporate and
tion should be granted based on the fac- ter-argument that the Act and the regu- Securities Law (Unisa) is a non-prac-
tors indicated above, which are found in lations do provide an ‘escape clause’ in tising attorney employed as legal
s 119(6), and with supporting documents terms of s 119(6) wherein the require- counsel for the Takeover Regulation
including written agreements attached. ments for applying for and obtaining Panel in Johannesburg.
In addition to these requirements, the an exemption are all encompassing and
WIN ad
iP
an

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Is
s e x t i n g
r i m i n a l
a c
e n c e ?
off
By Lesedi
Malosi
Molosiwa

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FEATURE
T
he act of ‘sexting’ or to ‘sext’ In De Reuck v Director of Public Pros- images showing the second appellant in
is defined as the exchange ecutions, Witwatersrand Local Division, compromising positions and that, by vir-
of pornographic material or and Others 2003 (3) SA 389 (W) the appli- tue of his possession of these images, he
sexually explicit messages, cant who had been charged with posses- had acted as her accessory. There was in
pictures or videos via a mo- sion of certain material in contravention fact no evidence that the first appellant
bile phone or the internet. of s 27(1) of the Films and Publications was aware of the presence of these imag-
The assumption is that not all pornog- Act 65 of 1996 (the FP Act), applied for es on the computer; neither was this the
raphy, and especially sexting, is reported an order declaring s 27(1) read with s 1 only reasonable inference to be drawn
in case law in South Africa, which creates (child pornography) of the FP Act to be from the fact that they were found there.
gaps in the reported case law. Therefore inconsistent with the Constitution. In It was possible that some other person
most of the information is article based. other words, the applicant submitted had taken the pictures and stored them
The objective of this article is to, first, that the finding of unconstitutionally ex- on the computer unbeknown to the first
establish the relation between sexting cluded a defence of legitimate purpose appellant. This was a further reason for
and pornography, secondly, to deter- or public good or public interest where the first appellant’s conviction of inde-
mine whether there are reported cases such material was possessed for a bona cent assault to be set aside. The appeal
of sexting and, lastly, to determine how fide documentary, research work, drama was upheld and convictions and sen-
South African courts and legislation or work of art without involving real chil- tences were set aside.
have dealt with sexting. It discusses the dren. It is therefore evident that the South
premise that sexting is influenced by an Furthermore, the applicant submit- African common law position considers
increase in the use of mobile technol- ted that the section violated the rights the interests of the accused, the commu-
ogy making it more available globally for to privacy, more particularly because nity and of justice by applying the prin-
both adults and children. the definition of child pornography was ciple of ‘innocent until proven guilty’ by
To put the topic into context, the sce- vague and open-ended, and thus open to engaging the Constitution, thus address-
nario has been created where X (who is arbitrary and subjective decision-making access to the courts on appeal and
married to Y) is found to be in the pos- ing. In addition, the applicant referred to review.
session of explicit material, such as child s 22(1) of the FP Act that provides for the I submit, based on sched 1 of the CPA
pornography. X may desire to claim free- exemption of any person or institution providing for rape, indecent assault and
dom of expression and an infringement from ss 25, 27 and 28 if there was good sodomy, complemented by sched 2 that
of privacy if apprehended. X may also reason to believe bona fide purposes provides for rape only, that the CPA
claim that it is for research purposes or would be served by such exemption. The does provide for common law offences
that the minor is his or her child. The court held that, in terms of the values related to sexting. Therefore sexting is
question would be whether X’s spouse that the Constitution espoused and the a criminal offence in relation to the ele-
(Y) or the law would consent to such purpose of s 27(1), the limitation of the ments of the crime.
content being in the possession of X rights of the applicant were reasonable
or if the above reasons would be legiti- and justifiable. The Films and Publications
mate enough for the court to accept as In S v Geldenhuys 2009 (1) SACR 1 Amendment Act 3 of 2009
valid and just reasoning for the accused (SCA) on the other hand, the Supreme The Films and Publications Board (FPB)
without further evidence being adduced. Court of Appeal declared ss 14(1)(b) and is a statutory body established by the FP
With this scenario in mind, existing leg- 14(3)(b) of the Sexual Offences Act 23 of Act. The FPB’s task is mainly to classify
islation in South Africa will first be con- 1957 constitutionally invalid on the basis films, videos, DVDs, computer games
sidered. that the sentences of imprisonment im- and certain publications for their suit-
posed under these sections suspended able age viewership. It classifies all film
The Constitution pending decisions of the Constitutional material distributed in South Africa, ex-
Section 14 (privacy) and s 16 (freedom of Court on whether or not to confirm an cept that shown on TV.
expression) of the Constitution, as pro- order of invalidity. Section 1(e) of the FP Act (as amended
vided for in the Bill of Rights, enshrines In S v Koralev and Another 2006 (2) by the Films and Publications Amend-
the rights of all people in the Republic SACR 298 (N) the facts briefly stated ment Act 3 of 2009), states that child
of South Africa, including the right to that the appellants were convicted in a pornography ‘includes any image, how-
equality (s 9), the right to dignity (s 10) regional magistrate’s court on various ever created, or any description of a
and the right to freedom and security counts of indecent assault, contraven- person, real or simulated, or who is de-
of the person (s 12), which incorporates tions of the FP Act and, in the case of picted, made to appear, look like, repre-
the right to be free from all forms of the first appellant, were in contravention sented or described as being under the
violence from either public or private of s 14(1)(b) of the Sexual Offences Act. age of 18 years’. The FP Act states that
sources. Most importantly, the Constitu- The charges related to the commission ‘child pornography’ is when a person
tion provides for the rights of children of indecent acts involving minors and to (including a minor child) is –
and other vulnerable persons (including the creation or possession of child por- ‘(i) engaged in sexual conduct;
the disabled) to have their interests pro- nography. The first appellant received (ii) participating in, or assisting another
tected. an effective eight-year term of impris- person to participate in, sexual conduct;
onment, while the second appellant was or
Common law offences or sentenced to four years’ imprisonment (iii) showing or describing the body, or
crimes in terms of s 276(1)(i) of the Criminal parts of the body, of such a person in
I submit that, despite the absence of Procedure Act 51 of 1977 (CPA). a manner or in circumstances which,
reported case law dealing directly with Hefer JA stated that before the images within context, amounts to sexual ex-
sexting, it is important to identify the le- in question could be admissible in evi- ploitation, or in such a manner that it is
gal position in South Africa when dealing dence against the appellants there had capable of being used for the purposes
with pornography. The following cases to be some proof of their accuracy in the of sexual exploitation’.
will be looked at in order to provide the form of corroboration that the events de- I submit that sexting is addressed by
South African common law position on picted actually occurred. The SCA held s 1, which defines ‘explicit sexual con-
pornography, as it is a pivot on which that the court a quo had erred in finding duct’ as graphic and detailed visual pres-
sexting hinges. that the first appellant was aware of the entations or descriptions of any conduct
DE REBUS – APRIL2014
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FEATURE
contemplated in the definition of ‘sexual sess, create, produce, distribute, import, Criminal Law (Sexual Offences and Relat-
conduct’ in the FP Act. Section 1 moreo- access, advertise or promote child por- ed Matters) Amendment Act 32 of 2007,
ver defines ‘sexual violence’ as ‘conduct nography images. Section 24B(1) – which in terms of ss 18 and 19 respectively.
or acts contemplated in the definitions refers to prohibitions, offences and pen- Section 18, read with s 19, provides that
of “sexual conduct” and “explicit sexual alties on possession of films, games and the sexual grooming of children and ex-
conduct” that are accompanied either by publications – states in s 24B(1)(a) – (d) posure or display of or causing exposure
force or coercion, actual or threatened, that: ‘Any person who – or display of child pornography or por-
or that induces fear or psychological (a) unlawfully possesses; nography to children is prohibited.
trauma in a victim’. (b) creates, produces or in any way con- Section 18(1)(d) of the Criminal Law
In addition to various child protection tributes to, or assists in the creation or (Sexual Offences and Related Matters)
initiatives the Films and Publications production of; Amendment Act states that if one com-
Amendment Act has been amended to (c) imports or in any way takes steps to mits any of these acts related to child
make the investigation and prosecution procure … obtaining or accessing of; or pornography outside South Africa, he or
of child pornography offenders more ef- (d) knowingly makes available, exports, she may still be prosecuted on return to
fective. This is, for example, provided in broadcasts or in any way distributes or the country. I submit that this is an indi-
s 29, which also refers to s 24 of the FP causes to be made available, exported … cation that South African laws related to
Act identifying prohibition, offences and broadcasting or distributing, any film, pornography generally co-exist, resulting
penalties on distribution and exhibition game or publication which contains de- in the breach thereof being addressed
of films, games and publication. It states pictions, descriptions or scenes of child thereby avoiding conflict of laws. This
that, in terms of s 24A(1) ‘any person pornography or which advocates, ad- is evident by the Films and Publications
who knowingly distributes or exhibits vertises, encourages or promotes child Amendment Act and the Criminal Law
in public a film or game without first pornography or the sexual exploitation (Sexual Offences and Related Matters)
having been registered with the [FPB] of children, shall be guilty of an offence’. Amendment Act working hand in glove
as a distributor or exhibitor of films or Failure to report knowledge of child as seen above.
games, shall be guilty of an offence and pornography images to the police is also
thus liable, on conviction, to a fine or to an offence. This is provided for in terms
imprisonment for a period not exceeding of s 24B(2)(a) and (b) of the FP Act. Such
six months, or to both a fine and impris- a person who has knowledge of com-
onment’. The FP Act moreover, in terms mission of an offence provided for in Lesedi Malosi Molosiwa BT IND
of s 24A(2), classifies the above-men- s 24B(1)(a) to (d) must inform a police of- (TUT) LLB (NWU) is a candidate
tioned acts as ‘refused classification’ or ficial of the South African Police Service. attorney and paralegal volunteer at
classified as ‘XX’. It is also an offence to expose children to the Mafikeng Justice Centre.
In addition, it is also an offence to pos- pornography. This is provided for in the q
2014 Juta Law Prize for

Candidate Attorney Article
Tablet Device & online Essential Legal
Practitioner Bundle worth R20 000
Juta Law, in conjunction with De Rebus are again offering a prize for the best published
article submitted by a candidate attorney during 2014. Valued at almost R20 000, the prize
consists of a 32GB tablet with wi-fi & 3G PLUS a one-year single-user online subscription
to Juta’s Essential Legal Practitioner Bundle.
Submission conditions:
• The article should not exceed 2000 words in length and should comply with the general De Rebus publication guidelines.
• The article must be published between January and December 2014.
• The De Rebus Editorial Committee will consider all qualifying contributions and their decision will be final.
Queries and correspondence must be addressed to:

The Editor, De Rebus, PO Box 36626, Menlo Park 0102 • Tel: (012) 366 8800, Fax (012) 362 0969 • Email: [email protected]
www.jutalaw.co.za

- 36 -
FEATURE
Fair divorce: Picture source: Gallo Images/Thinkstock

By
Magdaleen
de Klerk
Misconduct does not play a role

in forfeiture claims
T
here is a general miscon- however, only one of the factors that the ment after having assaulted his wife. The
ception in divorce litiga- court may take into consideration in this conclusion by the court not to grant an
tion that a finding of ‘sub- regard. order for forfeiture was primarily based
stantial misconduct’ on the on the fact that the husband brought an
part of a spouse who, for Substantial misconduct immovable property into the joint estate.
example, had extra marital It was held in JW v SW 2011 (1) SA 545 This principle was also laid down in
affairs, justifies an order for forfeiture (GNP) that a finding of substantial mis- the case of Engelbrecht v Engelbrecht
of the benefits of a marriage in com- conduct does not on its own justify a for- 1989 (1) SA 597 (K) where the court held
munity of property or, alternatively, the feiture order. The finding of substantial that it could never have been the inten-
right to share in the accrual. Substantial misconduct in this case stemmed from tion of the legislature that a wife – who
misconduct on the part of a spouse is, the husband’s conviction and imprison- had for 20 years assisted her husband

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FEATURE
faithfully – should, because of her adul- benefit from a marriage that he or she breakdown and also that conduct that
tery, forfeit the benefits of the marriage has wrecked.) It was further held that cannot be considered very blameworthy,
in community of property. The court the legislature has unequivocally turned such as refusal to engage in conversa-
further illustrated this point by using its back on the ‘guilt element’ and that it tion, might be a factor leading to the
the following example: A wealthy elderly would be surprising if that rejected el- marriage breakdown.
man marries a young poor girl. After a ement would be allowed in through the In Beaumont v Beaumont 1987 (1) SA
marriage of short duration the man re- backdoor in terms of s 9. 967 (A) it was held that in many and
alised that he made the mistake of his probably most cases, both parties will be
life by marrying her and, on this realisa- Benefit to blame, in the sense of having contrib-
tion, cheated and assaulted his wife. The It was held in Moodley v Moodley (KZD) uted to the breakdown of the marriage.
judge concluded that, notwithstanding (unreported case no 7241/2002, 14-7- In such case, where there is no conspicu-
the husband’s substantial misconduct, 2008) (Tshabalala JP) that what the de- ous disparity between the conduct of the
a forfeiture order would be granted fendant forfeits is not his share of the one party and that of the other, the court
against his wife, due to the fact that the common property, but only the pecuni- will not indulge in an exercise to appor-
marriage was of short duration. ary benefit that he would have other- tion the fault of the parties and thus nul-
wise derived from the marriage. It was lify the advantages of the no-fault sys-
Section 9(1) of the further held that it was of the utmost tem of divorce.
Divorce Act 70 of 1979 importance that the claimant, in respect In Kritzinger v Kritzinger 1989 (1) SA
Section 9(1) of the Divorce Act, which of a claim for the forfeiture, must prove 67 (A) it was held that even if the ap-
deals with the aspect of forfeiture, reads some kind of contribution that exceeds pellant’s adultery was the immediate
as follows: the contribution of the other party to- cause of the marriage coming to an end,
‘When a decree of divorce is granted wards the joint estate. the respondent was by no means free
on the grounds of the irretrievable from blame. Human experience suggests
break-down of a marriage the court that, generally speaking, where there is
may make an order that the patrimonial a breakdown in a marriage, the conduct
benefits of the marriage be forfeited by of both parties has contributed to it. It
one party in favour of the other, either
‘Section 9 does not seems probable that it was, inter alia, the
wholly or in part, if the court, having provide for the recognition of this basic truth that led
regard to the duration of the marriage, the legislature to abolish, (save to the ex-
the circumstances which gave rise to the
application of tent where it is expressly indicated oth-
break-down thereof and any substantial the principle of erwise), the notion of ‘fault’ in divorce.
misconduct on the part of either of the In the Engelbrecht case it was held that
parties, is satisfied that, if the order for
fairness, neither the point of departure must be that par-
forfeiture is not made, the one party will does it impose a ties must be held to their antenuptial
in relation to the other be unduly ben- agreements. In the Wijker case it was
efited.’
purely penal held that the judge in the court a quo, in
The section therefore refers only to sanction for a finding that it would be unfair to allow
three circumstances the court may take the appellant to share in his wife’s estate
into account when considering forfei-
party’s misconduct. agency, lost sight of what community of
ture, namely – A party cannot property entails. The court held that s 9
• the duration of the marriage; does not provide for the application of
• the circumstances that gave rise to the
forfeit what he or the principle of fairness in order to de-
break-down thereof; and she has contributed viate from the nature of community of
• any substantial misconduct on the part property.
of either of the parties.
towards the
Conspicuously absent from s 9 is a marriage. Conclusion
catch-all phrase permitting the court, Section 9 does not provide for the ap-
in addition to the factors listed, to have
The court must plication of the principle of fairness,
regard to any other factor. These three uphold the law and neither does it impose a purely penal
factors therefore fall within a relatively sanction for a party’s misconduct. A
narrow ambit. It was held in the case of
not make a moral party cannot forfeit what he or she has
Wijker v Wijker 1993 (4) SA 720 (A) that judgment.’ contributed towards the marriage. The
s 9 does not provide for the application court must uphold the law and not make
of the principle of fairness. a moral judgment. Attorneys, when ad-
It was further held that it is obvious vising their clients, should do so as well.
from the wording of s 9 that the first
step is to determine whether or not the As to what constitutes a contribution • See also 2011 (July) DR 20 and 2011
party against whom the order is sought towards the joint estate, it was held in (Nov) DR 22.
will in fact benefit. Once that has been Bezuidenhout v Bezuidenhout 2005 (2)
established, the trial court must deter- SA 187 (SCA) that the traditional role
mine, having regard to the factors men- of a housewife, mother and homemaker
tioned in the section, whether or not that should not be under-valued because it is
party will, in relation to the other, unduly not measurable in terms of money.
benefit if a forfeiture order is not made.
In Klerck v Klerck 1991 (1) SA 265 (W)
Substantial misconduct or Magdaleen de Klerk BA (Hons)
it was held that s 9 has to be interpreted adultery B Proc (UFS) Dip Human Rights
against a certain known common law In Swart v Swart 1980 (4) SA 364 (O) it (UP) is an attorney at Davel de
background. (The idea behind the old was held that adultery and desertion Klerk Kgatla in Polokwane.
forfeiture rule prior to s 9 was that the might in certain instances merely be
guilty spouse must not be allowed to symptoms and not causes of a marriage q

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LAW REPORTS
THE LAW REPORTS

February 2014 (1) The South African Law Reports (pp 323 – 640);
[2014] 1 The All South African Law Reports January no 1 (pp 1 – 124)
and no 2 (pp 125 – 248)
This column discusses judgments as and when they are published in the South African Law Re-
David Matlala BProc (University of
ports, the All South African Law Reports and the South African Criminal Law Reports. Readers
the North) LLB (Wits) LLM (UCT)
should note that some reported judgments may have been overruled or overturned on appeal
LLM (Harvard) HDip Tax Law
(Wits) is an adjunct professor of or have an appeal pending against them: Readers should not rely on a judgment discussed here
law at the University of Fort Hare. without checking on that possibility – Editor.
ABBREVIATIONS that, if a step-parent adopted or caregiver for a period of at court had discretion to order
a child, the rights and obliga- least three months. The defi- that the rights and responsi-
CC: Constitutional Court
tions of that biological child’s nition of ‘abandonment’ in bilities of the child’s parent
GNP: North Gauteng High Court
parents automatically termi- s 1 of the Act did not require or guardian would not ter-
GSJ: South Gauteng High Court
nated in all instances. that the child should have no minate on the granting of an
SCA: Supreme Court of Appeal
To overcome the above contact with both parents for adoption order in favour of
WCC: Western Cape High Court
problems in Centre for Child the said period before quali- the step-parent. Save in ex-
Children Law v Minister of Social Devel- fying as an abandoned child. ceptional circumstances, it
opment 2014 (1) SA 468 (GNP) It was also not required that would clearly be in the best
Adoption and its effect: Sec-
the applicant, the Centre for ‘the whereabouts of the non- interests of the child that
tion 230(3) of Children’s Act
Child Law, sought a declara- custodian parent cannot be such an order be made.
38 of 2005 (the Act) provides,
tory order to the effect that established’.
among others, that a child is
adoptable if:
s 230(3) of the Act did not Section 231(1)(c), which ex- Protection of funds
• The child is an orphan and
preclude a child from being pressly permitted the adoption awarded to
adoptable in instances where of a child by a step-parent did
has no guardian or caretaker
the child had a guardian and not contain a limitation that a children:
who is willing to adopt the
the person seeking to adopt step-parent could only adopt In Dube NO v Road Accident
child.
the child was the spouse or a child if the non-custodian Fund 2014 (1) SA 577 (GSJ)
• The whereabouts of the permanent domestic life-part- parent was no longer alive. It the plaintiff, Dube, was the
child’s parent or guardian ner of that guardian. was therefore in order for a father and sole guardian of
cannot be established. An order was also sought step-parent to adopt a child if a minor child aged 11 years,
• The child has been aban- declaring that s 242 did not the non-custodian parent had the mother having died. The
doned. automatically terminate all consented to the adoption of minor was seriously injured
• The child’s parent or guard- the parental responsibilities the child or if the child had, for in a motor vehicle collision,
ian has abused or deliberately and rights of the guardian no apparent reason, no contact and a claim for damages
neglected the child. of a child when an adoption with the non-custodian parent against the defendant, the
• The child is in need of per- order was granted in favour for at least three months or if Road Accident Fund, was
manent alternative place- of the spouse or permanent the whereabouts of the non- settled in an amount of over
ment. domestic life-partner of that custodian parent could not be R 3 million and a draft order
On the other hand, s 242(1) guardian, having regard to established. was prepared.
(a) of the Act provides that, ex- the discretion that s 242 af- Therefore, s 230(3) did not However, the court picked
cept when provided otherwise forded the court to order preclude a child from being up on a number of deficien-
in the order or in a post-adop- otherwise. Both orders were adoptable merely because the cies in the draft order, par-
tion agreement that has been granted. As a result it was no child had a parent or guardian ticularly as no mechanism
confirmed by the court, an longer necessary to consider who took care of the child and was devised to ensure that
adoption order terminates all the constitutional invalidity the person seeking to adopt the the proceeds could not be
parental responsibilities and of the two sections. child was the spouse or perma- released from the envisaged
rights that any person – in- Louw J held that where a nent domestic life-partner of trust at any time and used for
cluding a parent, step-parent non-custodian parent had the child’s parent or guard- purposes other than advanc-
or partner in a domestic life consented to an adoption of ian. ing the interests of the minor.
partnership – had in respect of his or her child, such par- In terms of s 242 adop- As a result the court directed
the child immediately before ent would be taken to have tion of a child automatically the plaintiff to prepare a re-
the adoption. These sections abandoned the child as con- terminated all rights and revised draft order, which the
were interpreted by officials templated in s 230(3)(c) and, sponsibilities of the parent court amended, and whose
in the Children’s Court to accordingly, render the child in respect of the child, except highlights included the –
mean that a child having one adoptable. A child was also when otherwise provided for • creation of a trust in terms
guardian could not be adopt- taken to have been aban- in the adoption order or in a of the Trust Property Control
ed by a spouse or life partner doned where, for no apparent post-adoption agreement that Act 57 of 1988;
of that guardian as such a reason, he or she had no con- had since been confirmed • inclusion of the plaintiff
child was not abandoned and tact with the parent, guardian by the court. Therefore, the as a co-trustee of a board of

- 39 -
trustees consisting of three entry, inspection, search or The provisions were therein the second session of oral
members; and seizure could be done at any fore broad as to the manner presentation was to proceed
• prohibition of amendment time and in any place without of conducting the searches, to the second and final phase
of the trust deed or addition a search warrant. To effect which searches could be of finance and black empow-
thereto without the court’s search and seizure, SARS of- conducted in private dwell- erment preference points as-
approval. ficials were given power to use ings at any time, and officials sessment.
The draft order also pro- force, for example, they were could not only break in at Of the 21 proposals re-
vided that the minor would allowed to break any window, the dwellings as, once inside, ceived, only two, namely that
be the sole beneficiary of the door, floor, ceiling or wall and they could even break floors. of the appellant AllPay and
trust income and capital and effect forceful opening in any To do all this SARS officials the third respondent Cash
also had other features relat- manner, of any room, place, did not need a warrant. That Paymaster, qualified for the
ing to protection of the funds. safe, chest, box, etcetera, if it power, unlimited as to time, second session. The appel-
In an obiter dictum, noth- was locked and the keys were the scope of the search and lant’s proposal failed at the
ing being contested, Fisher not produced on demand. the type of premises, was ex- second session of the first
AJ held that it was generally In Gaertner and Others v tremely intrusive and unjusti- stage, namely oral presenta-
accepted by the courts in the Minister of Finance and Oth- fied. tion as it received 58% and
carrying out of their function ers 2014 (1) SA 442 (CC) SARS The achievement of the ba- not the required minimum
as upper guardian of minors officials made such an entry, sic purposes of the Act did of 70%. That was due mainly
that, while it had to be ac- inspection, search and sei- not require that inspectors to the appellant’s inability to
knowledged that the guard- zure at the business premis- be allowed to enter private offer a satisfactory biometric
ian of a child had the power es, offices and private dwell- homes and inspect docu- verification system for the
and obligation to manage ings of the applicants, who ments and possessions at identification of beneficiaries
the child’s financial affairs, were directors of a company. will. The fact that the Act was of a social grant at every pay
it would not be a proper ap- In this case the WCC granted manifestly in the public inter- point, which verification was
proach simply to order that an order declaring the im- est in no way diminished the required to counter fraudu-
substantial funds be paid to a pugned sections of the Act need to protect and uphold lent payment of grants.
guardian without regard first unconstitutional and ordered the privacy, and indeed the The effect of the appel-
being had to the circumstanc- a return of items seized. The dignity, of individuals where, lant’s elimination was that
es under which the funds order of invalidity was sus- as in the case of private dwell- only the third respondent’s
were likely to be administered pended for a period of 18 ings, those rights were by no bid reached the second phase
and applied. months and was not retro- means attenuated. Less re- of the bidding process. In the
It was the court’s function, spective. The court also did strictive means to achieve absence of competition, SAS
in cases where relatively sig- extensive rewriting (reading- the purpose of the Act were SAfound it unnecessary to
nificant sums of money were in) of the section. available; for example, there assess the third respondent’s
awarded to minors, to inquire The order of invalidity was was no cogent reason for not finances and black empower-
into the circumstances relat- confirmed by the CC that providing for warrants in re- ment preferential scores and
ing to the person or persons to reduced the period of sus- spect of searches of people’s accordingly awarded the ten-
whom payment was sought to pension of invalidity to six homes. der to it.
be released for the purpose of months as parliament had Alleging a number of irregu-
satisfying itself that the order already made good progress Government larities in the tender process,
served the best interests of the in attending to the defects in the appellant approached the
minor in relation to payment the section. Once again the procurement High Court for an order declar-
and subsequent administra- order of invalidity was not Broad-based black economic ing the tender award unlawful
tion of the funds. This includ- retrospective. There was also empowerment credentials as and setting it aside. The GNP
ed assessing the motivations, less extensive reading-in into a mandatory and material con- held that the tender process
qualifications and ability of the provisions of the section sideration for a tender: The followed was illegal and inva-
the guardian to properly ad- that required entry, inspec- facts in AllPay Consolidated lid but declined to set aside
minister the funds to be paid tion, search and seizure to be Investment Holdings (Pty) Ltd the tender award, as doing so
in the event that it was sought authorised by a magistrate or and Others v Chief Executive would disrupt the payment of
that payment be made to such judge except in urgent cases. Officer, South African Social social grants. As the appellant
guardian. The applicants were granted Security Agency, and Others appealed to the SCA against
the costs of the application. 2014 (1) SA 604 (CC) were failure to set aside the tender
Customs and Delivering the unanimous that in April 2011, the South award, the third respondent
judgment of the CC, Madlan- African Social Security Agen- cross-appealed against the
excise ga Jheld that the wording of the cy (SASSA) published an invi- High Court order declaring the
Unconstitutionality of the section was so broad that it tation to tender (a request for tender award illegal and inva-
search without warrant brought within its sweep not proposals) calling on bidders lid.
provisions of the Customs only the places of business to present proposals to pay The SCA upheld the cross-
and Excise Act 91 of 1964: and houses of people who social grants on SASSA’s be- appeal, holding that there
Section 4(4) of the Customs were players in the customs half. The proposals were to be were no unlawful irregulari-
and Excise Act (the Act) had and excise industry, but also assessed in two stages. The ties in the tender process,
extensive provisions giving the homes of their clients, first stage was divided into adding that public interest
South African Revenue Ser- associates, service providers, two sessions, each of which dictated that a procurement
vice (SARS) officials power employees and their relatives. required a minimum score process should not be invali-
to enter any premises, busi- Quite conceivably the prem- of 70% to proceed to the next dated for minor inconsequen-
ness or residential, in order ises, business or home, of any session or stage. tial irregularities. After all, a
to inspect, search and remove person who could be linked The first session consisted fair process did not demand
items if they had suspicion to a player in the customs and of technical assessment of perfection since not every
that there was a contraven- excise industry could be the the proposal while the second flaw was fatal.
tion of the Act. The biggest subject of a search in terms was on oral presentation. Any On further appeal to the CC
problem though was that such of the impugned provisions. bid scoring a minimum of 70% leave to appeal was granted

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LAW REPORTS
and an appeal against the credentials of the winning thetic as it could combine concludes that it would be
SCA decision was upheld bidder. both aesthetic and functional unreasonable to expect a
with costs. The tender award • See also 2013 (Oct) DR 58. features. Where it incorpo- party to deal with the dispute
to the third respondent was rated functional features, without legal representation
declared constitutionally in- Intellectual however, those features were after considering the nature
valid, such declaration being excluded from protection by of the questions of law raised
suspended pending determi- property s 14(5). Moreover, s 14(6) ex- by the dispute, the complexi-
nation of a just and equita- Purely functional designs cluded from protection of a ty of the dispute, public inter-
ble remedy. The parties and do not qualify for registra- registered functional design est and the comparative abil-
amici curiae were ordered to tion as aesthetic designs: any features of pattern, shape ity of the opposing parties or
provide affidavits and further The Designs Act 195 of 1993 or configuration of an article their representatives to deal
written submissions on the (the Act) distinguishes be- that was in the nature of a with the dispute.
issue of a just and equitable tween aesthetic and function- spare part for a machine, ve- In the Commission for Con-
remedy. Until that remedy al designs. The Act defines hicle or equipment. ciliation, Mediation and Arbi-
was determined, the third ‘aesthetic design’ to mean, Aesthetic designs were tration and Others v Law Soci-
respondent was to continue among others, one having those that invited customer ety of the Northern Provinces
rendering the service of mak- features, ‘which appeal to and selection and consumer dis- (Incorporated as the Law Soci-
ing payments of social grants are judged solely by the eye, crimination between articles, ety of the Transvaal) [2014] 1
as per the tender awarded to irrespective of the aesthetic solely by their visual appeal. All SA 125 (SCA) the respond-
it. quality thereof’. On the other In the instant case, while the ent Law Society of the North-
Reading a unanimous deci- hand a ‘functional design’ appellant spent considerable ern Provinces (LSNP) sought
sion of the court Froneman J is defined, among others, to money, time and expertise and was granted an order by
held that, once a ground of mean one having features in designing the appearance the GNP, per Tuchten J, de-
review under the Promotion that are necessitated by the of its motor vehicles, it did claring the rule inconsistent
of Administrative Justice Act function that the article to not follow that because the with the Constitution and
3 of 2000 had been estab- which the design is applied, is designs of its vehicles quali- therefore invalid. The conten-
lished, there was no room for to perform. fied as aesthetic designs, the tion of the respondent was
shying away from it. Section In BMW AG v Grandmark designs of its components that the rule –
172(1)(a) of the Constitution International (Pty) Ltd and An- would qualify as such. • unfairly discriminated against
required the decision to be other 2014 (1) SA 323 (SCA) The design of individual legal practitioners in violation
declared unlawful. The conse- the appellant, BMW, sought in components had to be judged of s 9(3) of the Constitution;
quences of the declaration of the main an interdict restrain- independently of the design • infringed s 22 of the Consti-
unlawfulness would then be ing the respondent, Grand- of the built-up vehicles. The tution that guaranteed every
dealt with in a just and equi- mark, from importing and articles embodying the de- person the right to choose his
table order under s 172(1)(b). distributing in this country sign of the components were or her trade, occupation and
The materiality of irregulari- certain motor vehicle com- not selected by customers profession freely; and
ties was determined primar- ponents over which it held for their appeal to the eye: • infringed s 34 that ensured
ily by assessing whether the aesthetic design rights. In They were selected solely for that every person had the
purposes that the tender re- separate proceedings it also the function they performed, right to have any dispute that
quirements served had been sought from the respondent which was to replace com- could be resolved by the law
substantively achieved. royalties for alleged infringe- ponents so as to restore the to be resolved in a fair pub-
In the instant case, the han- ment of its rights. vehicle to its original form. lic hearing before a court or
dling of the tender process by Since, by the time of hear- The design of the compo- another independent and im-
SASSA made the crucial role ing of the appeal before the nents was therefore purely partial tribunal or forum.
reserved for transformation SCA, the design rights in functional and did not qualify An appeal against the High
in the procurement process a question had expired, the ap- for registration as aesthetic Court order was upheld with
nullity in that black economic pellant sought a declaration designs. costs by the SCA. Malan JA
empowerment points, which of infringement of its rights (Nugent, Wallis JJA and Swain
were to be assessed in the so that it could proceed with Labour law and Van der Merwe AJJA con-
second stage, played no role its claim for royalties from Constitutionality of limita- curring) held that the right to
in the decision because by the respondent. The respond- tion of right to legal repre- legal representation existed
that stage there was no com- ent counterclaimed for revo- sentation in CCMA arbitra- for the benefit and protection
petition. cation of registration of the tion proceedings: Rule 25(1) of litigants. In the instant case
An investigation into the designs in question, contend- (c) of the rules for the con- the LSNP did not purport to
propriety of empowerment ing that they did not qualify duct of proceedings before be pursuing the interests of
credentials did not become for registration in terms of the Commission for Concili- those who used the services
necessary only after a com- s 14 of the Act in the first ation, Mediation and Arbitra- of the CCMA. In essence, the
plaint had been lodged. There place. The GNP, per Ranchod J , tion (CCMA) provides that, complaint of the respondent
was an obligation on SASSA having upheld the revocation if the dispute arbitrated is was that the rule denied work
to ensure that empowerment counterclaim of the respond- about the fairness of dismiss- to its members.
credentials of the prospective ent, an appeal against that al and a party has alleged that In the run-up to the estab-
tenderers were investigated decision was dismissed with the reason for the dismissal lishment of the CCMA it was
and confirmed before the costs by the SCA. relates to the employee’s con- decided that, in the interest
award was finally made. That Nugent JA (Brand, Cacha- duct or capacity, the parties of efficacy and expeditious
obligation became even more lia, Wallis JJA and Swain AJA are not entitled to be repre- resolution of disputes before
crucial when there were no concurring) held that it was sented by a legal practitioner it, legal representation would
other competitors left in the evident from the definitions in the proceedings. Never- not be permitted in less com-
second stage. There was then of aesthetic and functional theless, the rule allows legal plex matters. The courts had
an even greater obligation for designs that to qualify for representation if the commis- consistently denied entitle-
the tender administrator to registration a design did not sioner and all the parties con- ment to legal representation
confirm the empowerment have to be exclusively aes- sent or if the commissioner as of right in fora other than

- 41 -
courts of law. The CCMA was A further appeal to the SCA an election to end the em- ure on the part of the claim-
not a court. was dismissed with costs. ployment relationship. ant post-accident to comply
Moreover, the rule and oth- Cachalia JA (Brand, Leach, • See also 2012 (Oct) DR 53. with his or her legal duties to
er provisions of the Labour Willis JJA and Zondi AJA the tax authorities. Payment
Relations Act 66 of 1995 were concurring), noting that the Motor vehicle of tax was an inevitable part
sufficiently flexible to allow CCMA considered the case of conducting business. The
for legal representation in to present a ‘cultural chasm’ accidents lawful conduct of business
deserving cases. It impacted between the parties, held that No compensation for loss of required, among others, com-
only on a litigant’s right to the fact that belief systems in illegal earnings: In Heese NO pliance with fiscal legislation.
be represented in a particular deeply held cultural convic- v Road Accident Fund 2014 (1) A court would, on grounds
forum. It therefore met the tions existed and were part SA 357 (WCC) the claimant, of public policy, only award
rationality standard. of the culture of customs, Peters, a German national, such amount as was consist-
• See also 2014 (Jan/Feb) DR ideas and social behaviour was seriously injured in a mo- ent with compliance by the
53. of significant sections of the tor vehicle collision in South claimant with his or her duty
country’s people was beyond Africa as a result of which of disclosure of his or her tax
Unfair dismissal – doubt and had since been his curatrix ad litem, Heese, affairs.
acknowledged by the courts. claimed compensation on his Public policy did not permit
clash of cultures: Also beyond dispute was the behalf from the respondent, one to award damages where
In Kievits Kroon Country Es- fact that, as part of those be- the Road Accident Fund. The the exploitation of the earn-
tate (Pty) Ltd v Mmoledi and lief systems, people resorted claim was settled on general ing capacity was dependent
Others 2014 (1) SA 585 (SCA) to traditional healers for their damages and medical expens- on illegality. If disclosure of
the respondent, Ms Mmoledi, physical, spiritual and emo- es, the only remaining issue tax evasion would have steri-
was an employee of the ap- tional wellbeing. being compensation for loss lised the claimant’s earning
pellant, Kievits Kroon. After Courts were familiar with of earning capacity. capacity because of harsh
allegedly seeing visions of and equipped to deal with The problem was that, al- criminal sanctions, the court
ancestors, the respondent un- disputes arising from con- though he was a business- could properly decline to
derstood the visions to mean ventional medicine, which man, his earnings were make an award for diminu-
that she had to undergo a were governed by objective made illegally under a mas- tion in earning capacity.
traditional healing course of standards, whereas questions sive fraudulent tax evasion
five weeks so that she could regarding religious doctrine scheme. Not only was he
become a traditional healer. or cultural practice were not under-declaring his earnings
Payment
Her traditional healer trainer, so governed. Courts were but he was also inflating his Risk of loss of cheque sent
one Mrs M, prepared a certifi- therefore unable and not expenses by, among others, through post: In Stabilpave
cate (a written note) explain- permitted to evaluate the ac- deducting fictitious expenses (Pty) Ltd v South African Rev-
ing the importance of that ceptability, logic, consistency from his income. The WCC enue Service 2014 (1) SA 350
training as, failing to heed the or comprehensibility of the held, per Blignault J, that the (SCA) the respondent, the South
ancestral call, could result in belief. They were concerned claimant was not entitled to African Revenue Service (SARS),
the respondent’s misfortune, only with the sincerity of the compensation for loss of il- owed the appellant, Stabilpave,
including serious illness or adherent’s belief, and wheth- legal earnings. An appeal to a tax refund in an amount of
death. er it was being invoked for an the Full Bench was dismissed over R 700 000. The tax assess-
The appellant was prepared ulterior purpose. with costs. ment form had a provision to
to allow the respondent to be It was well established that Rogers J (Veldhuizen and the effect that if banking details
absent for one week and not where an employee absented Schippers JJ concurring) held provided by the appellant were
five as requested. In the event himself or herself from work that, if it appeared from evi- not valid, payment of a refund
the respondent attended the without permission, and in dence that a claimant’s earn- would be effected by sending a
training and was absent from the face of his or her employ- ing capacity would as likely cheque using the postal service.
work without leave and con- er’s lawful and reasonable in- as not have been sterilised As the appellant did not pro-
trary to the instruction of the struction, a court was entitled and rendered worthless by vide banking details at all, a tax
employer to report for duty. to grant relief to the employee some or other event over the refund cheque was duly posted
An internal disciplinary hear- if the failure to obey the order future period covered by the but it never reached its destina-
ing found her guilty of mis- was justified or reasonable. claim, the court could prop- tion as it was intercepted and
conduct and recommended In the instant case it was erly conclude that a claim of the proceeds misappropriated
her dismissal, which was significant that evidence diminution in earning capac- by a thief.
done. showed that the respond- ity had not been established As a result the appellant
At the Commission for Con- ent would not have been on a balance of probability. sued the respondent for
ciliation, Mediation and Arbi- dismissed if she produced a The future event could, in the payment, which claim was
tration (CCMA) hearing it was certificate from a medical instant case, in principle be dismissed by the GNP, per
held that the respondent’s practitioner, instead of a lengthy imprisonment. It was Ismail AJ. An appeal against
dismissal was substantially traditional healer, as proof a factual question whether the decision of the court of
unfair as she was absent from of her illness, the certificate the earning capacity would first instance was dismissed
work due to circumstances from a traditional healer behave been rendered worthless by a majority of the Full Bench
beyond her control, namely ing considered meaningless or diminished in value by a comprising, Mavundla and
the call of her ancestors. She and thus rejected as proof of future event such as impris- Mothle JJ, with Fabricius J
was accordingly reinstated illness. onment. dissenting. An appeal against
but without retrospective The court added obiter that On grounds of public policy the decision of the Full Bench
payment. A review applica- an employer was not expect- a South African court would was upheld with costs by the
tion to the Labour Court was ed to tolerate an employee’s not make an award for dimi- SCA.
dismissed. So was an appeal prolonged absence from work nution in earning capacity Meyer AJA (Brand, Lewis,
to the Labour Appeal Court for incapacity due to ill health if the only way in which the Bosielo and Theron JJA con-
before Tlaletsi, Ndlovu JJA as it could, if that was fair in earning capacity could re- curring) held that any ‘agree-
and Murphy AJA. the circumstances, exercise main productive was by a fail- ment about the particular

- 42 -
LAW REPORTS
mode of performance’ or ‘as opinion there is no bona fide and verify the cause of action, Others cases
to the manner of payment’ defence and that the notice of the application for summary
Apart from the cases and ma-
was reached only if the credi- intention to defend has been judgment was fatally defec-
terial dealt with or referred
tor stipulated, requested or delivered solely for the pur- tive with the result that the
to above the material under
authorised a particular mode pose of delay. court could not even reach
review also contained cases
of payment and the debtor ac- In Absa Bank Ltd v Le Roux the question whether the de-
dealing with an administra-
ceded to the request. The deci- and Others 2014 (1) SA 475 fendant had made out a bona
tive action review application
sive question was whether the (WCC) an application for sum- fide defence.
being brought within rea-
notice contained in the tax as- mary judgment was resisted If the deponent to a sup-
sonable time, appeal against
sessment form gave the appel- on the ground that the de- porting affidavit in summary
conviction and sentence, ap-
lant a choice as to the mode ponent to the supporting af- judgment proceedings were
pealability of a court order,
of payment and, if it did, fidavit did not have personal able to aver that he was –
collateral challenge to the
whether the choice was made knowledge of the facts con- • an officer in the service of validity of administrative ac-
by the appellant, expressly or tained therein. In the affidavit the plaintiff; tion, compulsory acquisition
by necessary implication, that the deponent alleged that he • that the salient facts, which- of minority shares, consent of
the respondent should effect was a manager of the plain- should be particularised, a spouse to the sale of com-
payment by sending a cheque tiff, Absa Bank, that all the were electronically captured munal property, convening a
through the post. data and records relating to and stored in the plaintiff’s meeting of a municipal coun-
In the instant case the clear the action were under his records; cil, granting and refusal of re-
implication of the notice of control and that he had ac- • that he was authorised to zoning applications, levying
assessment was an advice quainted himself therewith. certify and has executed a of different municipal rates
from the respondent that the The deponent further alleged certificate certifying the facts for different categories of
tax record of the appellant re- that he had verified the in- contained in such record to property, liability for fraudu-
flected no banking details and debtedness of the defendants be correct; and lent misrepresentation, limi-
that payment would there- to the plaintiff as stated in • on the basis thereof was tation on the right to obtain
fore be effected by means of the summons. able to swear positively that legal assistance at state ex-
a cheque through the post. However, as it turned out the plaintiff would, having pense, motor vehicle accident
No choice was afforded to the indebtedness of the first regard to the provisions of litigation, party relying on rei
the appellant. The method of and second defendants, who s 15(4) of the Electronic Com- vindicatio need not tender
payment was dictated by the were directors of the compa- munications and Transac- restitution, payment of pur-
respondent. ny and its sureties, and whose tions Act 25 of 2002, be able chase price to a conveyancer,
The mere fact that the ap- indebtedness arose out of to prove the relevant facts at reinstatement of the registra-
pellant knew or expected to suretyship contracts, was dif- the trial of the action by pro- tion of a company, restitu-
be paid by cheque through ferent from the amount stated ducing the electronic record tion of land rights, right to
the post or that it did not in the summons. The affidavit or an extract thereof; the re- state-funded legal represen-
raise an objection did not it- did not deal with the discrep- quirements of r 32(2) would tation before a commission of
self give rise to an implied re- ancy. be satisfied. inquiry, termination of busi-
quest or election to be paid in Binns-Ward J dismissed the The court added that it ness rescue proceedings and
such manner. application for summary judg- would be salutary for the de- unfairly prejudicial, unjust,
Accordingly, the risk of ment, granted the defendants ponent to any such affidavit inequitable or oppressive con-
loss of the cheque was not as- leave to defend and ordered also to explain why the evi- duct in the running of a close
sumed by the appellant and the costs to be costs in the dence was not being adduced corporation.
remained with the respond- cause of the action. The court by means of the affidavit of
ent that did not discharge held that the supporting affi- someone with direct personal
its indebtedness by posting a davit fell short of what r 32(2)
cheque for the amount of the required. The only facts set
knowledge of the facts. q
refund that was due to the ap- out in the affidavit were the
pellant. defendant’s position in the
plaintiff’s employ, his being
Summary based in Johannesburg, his
control of and reference to the
judgment data and records relating to
An officer of a corporate en- the action that pertained to an
tity may rely on data mes- account that was opened and
sages for his or her personal operated at Hermanus in the
knowledge in deposing to af- Western Cape. That by itself
fidavit: Rule 32(2) of the uni- that was not good enough.
form rules of court provides, Sufficient compliance by
among others, that the plain- the plaintiff with the require-
tiff shall within 15 days after ments of r 32(2) on the papers
the date of delivery of notice considered as a whole was a
of intention to defend, de- sine qua non to the court’s
liver notice of application for ability to entertain the ap-
summary judgment, together plication. Unless it appeared
with an affidavit made by from a consideration of the
himself or herself or by any papers as a whole that the
other person who can swear deponent to the supporting
positively to the facts verify- affidavit probably did have
ing the cause of action and sufficient direct knowledge
the amount, if any, claimed of the salient facts to be able
and stating that in his or her to swear positively to them

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CASE NOTE
Limitations on
liability in delict
Country Cloud Trading CC v MEC, Department of
By
Ian Infrastructure Development (SCA)
Chadwick
(unreported case 751/12, 26-11-2013)
(Brand JA)
I
n Country Cloud Trading CC v MEC, whether the element of wrongfulness are considerations to be weighed up with
Department of Infrastructure De- necessary to sustain a delictual action all others in determining whether de-
velopment (SCA) (unreported case had been proved. In doing so, the court lictual liability should be imposed. The
751/12, 26-11-2013) (Brand JA) the reviewed the development of the law of court further concluded that, since fore-
Supreme Court of Appeal (SCA) was delict within the context of liability for seeability of harm is a prerequisite for
confronted with a claim brought in delict pure economic loss, starting with the de- delictual liability in all cases, that feature
by the appellant, Country Cloud Trad- cision in Administrateur, Natal v Trust could not render the appellant’s claim
ing CC, that was a stranger to a contract Bank van Afrika Bpk 1979 (3) SA 824 (A). deserving of special treatment.
concluded between the respondent and In the Trust Bank case, when extend- The court further concluded that since
another party (Ilima). The appellant ing liability for pure economic loss, the the imposition of delictual liability on
claimed that it had suffered damages as court realised the danger of ‘limitless lia- the respondent would, as a general prin-
a direct consequence of the repudiation bility’ inherent in the extension and con- ciple, render contracting parties liable
or unlawful cancellation by the respond- cluded that the ‘instrument of control to in delict for harm suffered by strangers
ent of its contract with Ilima and, in con- prevent limitless liability’ is the delictual that flows from the repudiation of their
sequence thereof, claimed that it was element of wrongfulness. contract, this was a strong pointer away
entitled to compensatory damages from Subsequent decisions of the then Ap- from the imposition of delictual liabil-
the respondent. Such a claim is, as far pellate Division and SCA and, more re- ity. To find otherwise would open the
as I am aware, novel. Brand JA, who de- cently, the Constitutional Court in Le door to ‘indeterminate liability’. A fur-
livered the unanimous judgment of the Roux v Dey (Freedom of Expression In- ther consideration to which the court
court, dismissed the claim. stitute and Restorative Justice Centre as referred was the appellant’s (lack of)
Briefly, the facts of the case were that Amici Curiae) 2011 (3) SA 274 (CC) have ‘vulnerability to risk’. Vulnerability to
Ilima had concluded a contract with the held that wrongfulness, in the context of risk signifies that the plaintiff could not
respondent (referred to in the judgment delictual liability, is determined by con- reasonably have avoided the harm suf-
as the ‘completion contract’) for the siderations of legal and public policy. In fered by other means.
completion of the Zola Clinic in Soweto the Dey case, the court was at pains to The court stated that it has now be-
for a contract price of R 480 million. Ili- point out that reasonableness in the con- come well-established in law that the
ma was unable to proceed with the work text of wrongfulness has nothing to do finding of non-vulnerability on the part
without funding. It obtained this funding with the reasonableness of the defend- of a plaintiff is an important indicator
by means of a loan that it raised with the ant’s conduct, but concerns the reasona- against the imposition of delictual li-
appellant in the sum of R 12 million. The bleness of imposing liability on the de- ability on persons such as the defend-
appellant was to be repaid the loan, to- fendant for the harm resulting from that ant (respondent) in the present case.
gether with a profit of R 8,5 million, out conduct (at para 122). Thus, where it is reasonably possible for
of progress payments by the respondent With reference to the appellant’s argu- the plaintiff to take steps to protect it-
to Ilima. Prior to any progress payments ment that public policy should impose self, the law will be less inclined to step
being made, the respondent cancelled liability because the respondent’s repre- in and impose a duty on the defendant
the completion contract alleging mate- sentative knew that cancellation of the to protect the plaintiff from the risk of
rial misrepresentations that induced it completion contract would cause harm pure economic loss.
to conclude the completion contract. to the appellant, the court approved the
Subsequently Ilima went into liquidation statement of M Loubser and R Midgley
without paying the appellant anything. in The Law of Delict in South Africa 2
At the appeal hearing, the SCA ac- ed (Cape Town: Oxford University Press
cepted the appellant’s contention that 2012) at 141 that ‘intentionally causing
the respondent had wrongfully repudi- harm to others will not always be wrong- Ian Chadwick BA LLB PGDip Tax
ated the completion contract in that its ful’ and that ‘intent does not necessarily (UKZN) is an attorney at Shepstone
representative had intentionally can- indicate wrongfulness’. The court con- & Wylie in Umhlanga.
celled it without any legal justification. cluded that, in the end, the nature of the
The court then proceeded to examine fault and the degree of blameworthiness q

- 44 -
Waiver of rights in insolvency
By
Kroese and Kroese (NWM) (unreported case no 145/13,
Moffat 18-4-2013) (Landman J) and Hattingh and Hattingh (NWM)
Ndou (unreported case no 144/13, 18-4-2013) (Landman J)
T
he North West High Court, tlements to their property referred to in or exempted from insolvent estates’ (at
Mafikeng in the unreported s 86(2) of the Act. First, the court was para 42).
judgment of Kroese and Kroe– concerned with the discretionary nature With reference to Bafana Finance Ma-
se (NWM) (unreported case no of s 82(6). The court refrained from de- bopane v Makwakwa and Another 2006
145/13, 18-4-2013) (Landman ciding the constitutional validity of the (4) SA 581 (SCA) and S v Makwanyane
J) and Hattingh and Hattingh (NWM) provision, but decided that it will inter- and Another 1995 (3) SA 391 (CC), the
(unreported case no 144/13, 18-4-2013) vene if the discretion was not exercised court accepted that the right to dignity
(Landman J) had the opportunity to con- reasonably. is at least one of the human rights that
sider whether the waiver of the rights Secondly, the court was concerned are inalienable.
provided in s 82(6) of the Insolvency Act whether the applicants could validly The court considered the applicants’
24 of 1936 (the Act) is an infringement of waive their entitlement to basic necessi- submission by dividing it into four
a constitutional right of the applicants. ties. The court departed from the deci- points and made the following findings:
Section 82(6) reads as follows: ‘From sion in the Anthony case, because that • The court found that the contention
the sale of the movable property shall court paid insufficient attention to the that the goods mentioned in s 82(6) of
be excepted the wearing apparel and principle that a waiver ‘was subject to the Act are divisible into two catego-
bedding of the insolvent and the whole certain exceptions, of which one was ries was not relevant to the question of
or such part of his [or her] household that no one could renounce a right con- waiver.
furniture, and tools and other essential trary to law, or a right introduced not • With regard to the contention that
means of subsistence as the creditors, or only for his [or her] own benefit but in the waivers related to the applicants’
if no creditor has proved a claim against the interests of the public as well’. The personal capacity and that no public
the estate, as the Master may determine court made it clear that s 82(6) of the Act policy was involved, the court pointed
and the insolvent shall be allowed to re- must be read in the context of the consti- out that the Act and other legislation
tain, for his [or her] own use any prop- tutional dispensation. that provides for protection of debtors
erty so excepted from the sale.’ The court proceeded to interpret the were enacted for the benefit of debtors
The judgment is in respect of two provisions of s 82(6) of the Act in the and for the wellbeing of the society. The
separate applications for two separate context of the right to life and dignity. court further remarked that it is not in
estates. The court gave one judgment in The court noted that the purpose of the state’s interest that citizens should
respect of these two applications as, in s 82(6) was to provide measures that are renounce their assets and become a bur-
both applications, the applicants intend- intended to preserve the right to life and den on society.
ed to waive assets that were afforded a dignity of an insolvent and his or her or • With regard to the applicants’ open and
measure of protection by s 82(6) of the their dependents and to place them in a frank account of their financial situation
Act. The waivers were done in order to position to rebuild their lives. and their eagerness to assist the court,
increase the value of the realisable as- In placing the entitlement as regards the court pointed out that the law does
sets and in order to show that the sur- necessities in context, the court refers, not allow them to make the sacrifice they
render of the respective estates would be inter alia, to a passage in Prof RG Evans’ were attempting to make.
to the advantage of creditors. article titled ‘Legislative exclusions or • The applicants submitted that they had
Both applicants were married in com- exemptions of property from the insol- a right to freedom of trade, which en-
munity of property and both applica- vent estate’ [2011] (14) 5 PER 28 (www. compasses the right to dispose of their
tions were for the voluntary surrender of saflii.org.za/journals/PER/2011/28.pdf, property at their own and free will. The
their respective insolvent estates. All the accessed 30-1-2014): court answered the submission by point-
formalities required for an application to ‘Although South African insolvency ing out that most rights can be limited
surrender an estate had been complied law is based on the policy of the collec- and that the protection afforded to their
with. The court had to decide whether tion of the maximum quantity of assets right to life and dignity in terms of the
the waiver by the applicants was permis- available, to the advantage of the credi- Act was not theirs to waive.
sible because without it there would be tors of the insolvent estate, a further The court made it clear that it was not
no advantage for creditors. policy, that of allowing a debtor to keep possible to waive a right to basic neces-
The applicants relied on the full Bench a part of his [or her] estate, has also been sities. The court refused to grant the
decision in Ex parte Anthony en ’n An- entrenched, originally through the com- voluntary surrender application on the
der en Ses Soortgelyke Aansoeke 2000 mon law. It would appear that originally basis that the applicants failed to show
(4) SA 116 (K) in their submission that, the rationale behind this policy, as it de- sufficient advantage for their respective
in order to establish an advantage to veloped through the common law, was creditors.
creditors, the applicant may waive the to ensure that the insolvent and his [or
protection afforded by s 82(6) of the Act. her] family were not deprived of their
The court noted that the Anthony case dignity and basic life necessities. It is
was distinguishable because in that case submitted that this remains the corner-
the court did not consider whether the stone upon which this policy rests, but
waiver would be an infringement of the that the requirements of modern society, Moffat Ndou LLB (UJ) is a law
equivalent of a constitutional right of the socio-political developments in most so- researcher at the North West High
applicant. cieties, and human rights requirements Court in Mafikeng.
The court raised two concerns regard- have necessitated a broadening of the
ing the applicants’ waiver of their enti- classes of assets that should be excluded
q

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NEW LEGISLATION
Legislation published from
15 January – 21 February 2014
Philip Stoop BCom LLM (UP) LLD * Items marked with an asterisk will be discussed later in the
(Unisa) is an associate professor in the column
department of mercantile law at Unisa.
BILLS INTRODUCED South African Post Office SOC Ltd for sale in the Republic of South Africa.
Amendment Act 38 of 2013. Com- GN R112 GG37330/14-2-2014.
Medical Innovation (Private Member Bill) mencement: 27 January 2014. GN53 Animal Diseases Act 35 of 1984
B100P-2014. GG37269/27-1-2014. Tariffs payable for veterinary im-
National Water Amendment Bill B3 of South African Postbank Limited Amend- port permits from 1 April 2014. GN51
2014. ment Act 44 of 2013. Commencement: GG37287/7-2-2014.
Development Bank of Southern Africa 27 January 2014. GN54 GG37270/27-1- Broad-based Black Economic Empower-
Amendment Bill B2 of 2014. 2014. ment Act 53 of 2003
Financial Management of Parliament Broad-based Black Economic Empower- Procedures for the application, adminis-
Amendment Bill B1 of 2014. ment Amendment Act 46 of 2013. Com- tration and allocation of export permits
mencement: To be proclaimed (except under the trade, development and coop-
PROMULGATION OF ACTS for s 3(b) that will come into operation eration agreement between the European
one year after the Act has come into op- Union and the Republic of South Africa.
Tax Administration Laws Amend- eration). GN55 GG37271/27-1-2014. GenN28 GG37242/21-1-2014.
ment Act 39 of 2013. Commencement:
Companies Act 71 of 2008
Deemed to have come into operation
COMMENCEMENT OF ACTS Amendment of Companies Regulations,
on 1 October 2012 save insofar as is
2011 (Reg 15(3)(b)). GN82 GG37299/5-2-
otherwise provided in the Act. GN14
Financial Services Laws General 2014.
GG37236/16-1-2014.
Amendment Act 45 of 2013. Com- Conservation of Agricultural Resourc-
Financial Services Laws General
mencement: 28 February 2014 (except ss es Act 43 of 1983
Amendment Act 45 of 2013. Com-
5(a) and 186(d) that will come into op- Revised tariffs for services rendered in
mencement: To be proclaimed. GN15
eration on 30 May 2014; s 31 that will terms of the Act. GN67 GG37286/5-2-
GG37237/16-1-2014.
come into operation on 29 August 2014; 2014.
Employment Equity Amendment Act
and ss 61, 95, 109(e), (k) and (l), 114(d), Department of Agriculture, Forestry
47 of 2013. Commencement: To be pro-
135 and 264 that will come into opera- and Fisheries
claimed. GN16 GG37238/16-1-2014.
tion on a date to be proclaimed. GN120 Conditions for application for market ac-
South African Weather Service Amend-
GG37351/18-2-2014. cess permits for particular agricultural
ment Act 48 of 2013. Commencement:
products. GenN27 GG37241/21-1-2014.
On the date two months from the date of
publication in the Government Gazette SELECTED LIST OF Electoral Act 73 of 1998
Amendment to the Election Regulations,
or such earlier date determined by proc- DELEGATED LEGISLATION 2004. GenN31 GG37259/23-1-2014.
lamation. GN17 GG37239/16-1-2014.
South African Human Rights Commis- Agricultural Product Standards Act 119 Electronic Communications Act 36 of
sion Act 40 of 2013. Commencement: of 1990 2005
To be proclaimed. GN37 GG37253/22- Regulations relating to the grading, pack- Call Termination Regulations, 2014.
1-2014. ing and marking of avocados intended GenN65 GG37295/4-2-2014.
Judicial Matters Amendment Act 42 for sale in the Republic of South Africa. Call Termination Amendment Regula-
of 2013. Commencement: Sections 10 GN R5 GG37223/17-1-2014. tions, 2014. GenN114 GG37356/19-2-
and 11 are deemed to have come into Amendment of standards and require- 2014.
operation on 1 April 2010 and s 42 is ments regarding control of the export of Engineering Council of South Africa
deemed to have come into operation on citrus fruits. GN52 GG37287/7-2-2014. Rules for continuing professional de-
20 September 2010. GN38 GG37254/22- Amendment of standards and require- velopment and renewal of registration.
1-2014. ments regarding control of the export of BN16 GG37337/21-2-2014.
Judicial Matters Second Amendment cherries. GenN29 GG37246/24-1-2014. Financial Markets Act 19 of 2012
Act 43 of 2013. Commencement: To be Amendment of standards and require- Amendments to depository rules.
proclaimed. GN39 GG37255/22-1-2014. ments regarding control of the export of BN13 GG37344/14-2-2014 and BN14
*Criminal Law (Forensic Procedures) fruit excluding citrus and certain decidu- GG37345/14-2-2014.
Amendment Act 37 of 2013. Com- ous fruits. GN53 GG37287/7-2-2014. Gas Regulator Levies Act 75 of 2002
mencement: To be proclaimed. GN52 Regulations relating to the grading, pack- Levy and interest payable on piped-gas
GG37268/27-1-2014. ing and marking of dry beans intended industry. GN41 GG37256/24-1-2014.

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NEW LEGISLATION
Genetically Modified Organisms Act 15 income, signed at Rome on 16 May 1997. Medicines and Related Substances Act
of 1997 GN19 GG37243/24-1-2014. 101 of 1965
Tariffs for services. GN95 GG37307/14- Supplementary protocol amending the Annual adjustment of the single exit
2-2014. agreement between the Government of price of medicines and scheduled sub-
Amendment of regulations. GN96 the Republic of South Africa and the stances (SEPA) for the year 2014. GN R68
GG37307/14-2-2014. Government of the Sultanate of Oman GG37292/31-1-2014.
Health Professions Act 56 of 1974 for the avoidance of double taxation Information to be provided by manu-
Regulations relating to the qualifications and the prevention of fiscal evasion facturers and or importers of medicines
for registration of basic ambulance assis- with respect to taxes on income. GN20 and scheduled substances when apply-
tants, ambulance emergency assistants, GG37244/29-1-2014. ing for the single exit price adjustment
operational emergency care orderlies Agreement between the Government of for 2014. GN R69 GG37292/31-1-2014.
and paramedics. GN R57 GG37274/28- the Republic of South Africa and the Amendment of schedules to the Act. GN
1-2014. Government of the Republic of Liberia R104 GG37318/11-2-2014.
Regulations relating to the qualifications for the exchange of information relating Military Veterans Act 18 of 2011
for the registration of emergency care to tax matters. GN105 GG37321/12-2- Military veterans benefits regulations.
practitioners. GN R58 GG37275/28-1- 2014. GN R122 GG37355/19-2-2014.
2014. Convention on Mutual Administrative Mineral and Petroleum Resources De-
Regulations relating to the registration Assistance in Tax Matters, as amended velopment Act 28 of 2002
of student emergency care assistants, by the provisions of the protocol amend- Restriction in terms of s 49(1) of the Act
student emergency care technicians, or ing the Convention on Mutual Adminis- on granting of new applications for re-
student emergency care practitioners. trative Assistance in Tax Matters, which connaissance permits, technical co-op-
GN R59 GG37276/28-1-2014. entered into force on 1 June 2011. eration permits, exploration rights and
Regulations relating to names that may GN113 GG37332/21-2-2014. production rights in certain areas. GN71
not be used in relation to the profession Independent Communications Author- GG37294/3-2-2014.
of emergency care. GN60 GG37277/28- ity of South Africa Act 13 of 2000 National Environmental Management:
1-2014. Regulations on party election broad- Biodiversity Act 10 of 2004
Regulations relating to the registration casts, political advertisements, the eq- Norms and standards for biodiversity
of student emergency care consultants uitable treatment of political parties by management plans for ecosystem. GN83
and student emergency care specialists. broadcasting licensees and related mat- GG37302/7-2-2014.
GN R61 GG37278/28-1-2014. ters. GenN101 and 102 GG37350/17-2- National Forests Act 84 of 1998
Amendment of rules relating to the reg- 2014. Exempted activities in terms of ss 7(1)
istration by medical practitioners and Insolvency Act 24 of 1936 and 15(1) of the Act regarding trees pro-
dentists of additional qualifications. Policy on the appointment of insolvency tected in terms of s 12(1) of the Act. GN
BN12 GG37307/14-2-2014. practitioners. GN77 GG37287/7-2-2014. 25 GG 37246/24-1-2014.
Regulations relating to the registration Judicial Service Commission Act 9 of National Health Act 61 of 2003
of speech language therapy students. 1994 Publication of health infrastructure
GN86 GG37312/10-2-2014. Regulations relating to the Act: Disclo- norms and standards guidelines. GN
Amendment of regulations relating to sure of registrable interests. GN R56 R116 GG37348/17-2-2014.
the registration by environmental health GG37273/29-1-2014. National Nuclear Regulator Act 47 of
practitioners of additional qualifica- Liquor Act 59 of 2003 1999
tions. GN R102 GG37316/11-2-2014. National liquor norms and standards. Fees for nuclear authorisations. GenN38
Regulations relating to the qualifications GenN80 GG37322/11-2-2014. GG37262/31-1-2014.
for the registration of emergency care Liquor Products Act 60 of 1989 National Regulator for Compulsory
consultants. GN R101 GG37319/11-2- Amendment of regulations. GN R89 Specifications Act 5 of 2008
2014. GG37308/14-2-2014. Amendment of the compulsory specifi-
Regulations relating to the under- Local Government: Municipal Systems cation for incandescent lamps (VC 8043).
graduate curricula and professional Act 32 of 2000 GN R74 GG37288/7-2-2014.
examinations in audiology. GN R106 Local government: Regulations on Compulsory specification for energy ef-
GG37323/12-2-2014. appointment and conditions of em- ficiency and labelling of electrical and
Regulations relating to the qualifica- ployment of senior managers. GN21 electronic apparatus (VC 9008). GN R75
tions for the registration of emergency GG37245/17-1-2014. GG37288/7-2-2014.
care specialists. GN R107 GG37324/13- Occupational Health and Safety Act 85
Magistrates’ Courts Act 32 of 1944
2-2014. of 1993
Creation of magisterial districts and es-
Regulations relating to the qualifications Construction regulations, 2014. GN R84
tablishment of district courts for Gaut-
for the registration of emergency care as- and 85 GG37305/7-2-2014.
eng and North West provinces. GN43
sistants. GN R109 GG37326/13-2-2014. Petroleum Pipelines Levies Act 28 of
GG37258/24-1-2014.
Regulations relating to the qualifications 2004
Withdrawal of notices creating magiste-
for the registration of Emergency Care Levy and interest payable on petroleum
rial districts and establishing district
Technicians. GN R111 GG37329/14-2- pipelines industry. GN40 GG37256/24-1-
courts for Gauteng and North West prov-
2014. 2014.
inces. GN42 GG37257/24-1-2014.
Higher Education Act 101 of 1997 Plant Improvement Act 53 of 1976
Creation of sub-districts and the ap-
Institutional statute: Walter Sisulu Uni- Regulations relating to establishments,
pointment of a place within the sub-dis-
versity. GN13 GG37235/17-1-2014. varieties, plants and propagating mate-
trict for the holding of a court. GN121
Income Tax Act 58 of 1962 rial. GN R88 GG37308/14-2-2014.
GG37353/20-2-2014.
Protocol amending the agreement be- Plant Breeder’s Rights Act 15 of 1976
tween the Government of the Republic Marketing of Agricultural Products Act Amendment of regulations relat-
of South Africa and the Government of 47 of 1996 ing to plant breeder’s rights. GN R90
the Republic of Malta for the avoidance Amendment of declaration of agricul- GG37308/14-2-2014.
of double taxation and the prevention of tural products. GN R46 GG37263/31-1- Postal Services Act 124 of 1998
fiscal evasion with respect to taxes on 2014. Fees and charges for postal services.

- 47 -
NEW LEGISLATION
GenN49 GG37283/30-1-2014. Mutale, Dzanani and Vuwani. GN35 Agricultural Remedies and Stock Rem-
Remuneration of Public Office Bearers GG37246/24-1-2014. edies Act 36 of 1947. GN54 GG37287/7-
Act 20 of 1998 Establishment of a small claims court for 2-2014.
Determination of upper limits of sala- the area of Senekal. GN118 GG37337/21- Draft national norms and standards
ries, allowances and benefits of different 2-2014. for organic waste composting in terms
members of municipal councils. GN R64 of the National Environmental Manage-
South African Reserve Bank Act 90 of
GG37281/29-1-2014. ment: Waste Act 59 of 2008. GenN68
1989
Determination of salaries and allow- GG37300/7-2-2014.
Amendment of South African Re-
ances of the traditional leaders, mem- Draft South African automotive industry
serve Bank Regulations, 2010. GN119
bers of the national house and provin- code of conduct in terms of the Consum-
GG37337/21-2-2014.
cial houses of traditional leaders. Proc9 er Protection Act 68 of 2008. GenN69
South African Schools Act 84 of 1996
GG37352/18-2-2014. GG37301/7-2-2014.
Amended national norms and standards
Road Accident Fund Act 56 of 1996 Draft Alien and Invasive Species Lists,
for school funding. GN12 GG37230/17-
Adjustment of statutory limit in respect 2014 and Regulations, 2014 in terms
1-2014.
of claims for loss of income and loss of of the National Environmental Man-
Tax Administration Act 28 of 2011
support. BN8 GG37262/31-1-2014. agement: Biodiversity Act 10 of 2004.
Regulation for purposes of s 70(4) of the
Small Claims Courts Act 61 of 1984 GenN78 and 79 GG37320/12-2-2014.
Act, promulgated under s 257 of the Act,
Establishment of a small claims court for Draft Immigration Regulations, 2014 in
listing the organs of state or institutions
the area of Melmoth. GN28 GG37246/24- terms of the Immigration Act 13 of 2002.
to which a senior South African Revenue
1-2014. GenN97 GG37335/14-2-2014.
Service official may lawfully disclose
Establishment of a small claims court for Proposed regulations regarding fees for
specified information. GN R93 and 94
the area of Nqutu. GN29 GG37246/24-1- the provision of aviation meteorological
GG37308/14-2-2014.
2014. services in terms of the South African
Establishment of small claims courts Weather Service Act 8 of 2001. GenN99
for the areas of Welkom, Hennen-
Draft legislation GG37343/14-2-2014.
man, Virginia and Ventersburg. GN30 Draft Position Paper on the South Afri- Draft amendment regulations on bio-
GG37246/24-1-2014. can Biofuels Regulatory Framework in prospecting, access and benefit-sharing
Establishment of small claims courts for terms of the National Energy Act 34 of in terms of the National Environmen-
the areas of Bethlehem and Reitz. GN31 2008. GenN24 GG37232/15-1-2014. tal Management: Biodiversity Act 10 of
GG37246/24-1-2014. Draft Agrément South Africa Bill. 2004. GenN73 GG37331/17-2-2014.
Establishment of a small claims court for GenN26 GG37234/17-1-2014. Proposed amendments to the Johan-
the area of Vrede. GN32 GG37246/24-1- Draft Amendment End-user and Sub- nesburg Stock Exchange listing require-
2014. scriber Service Charter in terms of the ments in terms of the Financial Markets
Establishment of a small claims Electronic Communications Act 36 of Act 19 of 2012. BN15 GG37337/21-2-
court for the area of Sasolburg. GN33 2005. GenN30 GG37251/22-1-2014. 2014.
GG37246/24-1-2014. Proposed amendment to the regulations Proposed amendment of regulations
Establishment of a small claims court for relating to the registration of fertilizers, on exhumation, reburial or symbolic
the area of Tsakane. GN34 GG37246/24- farm feeds, agricultural remedies, stock burial of deceased victims in terms of
1-2014. remedies, sterilizing plants and pest the Promotion of National Unity and
Establishment of small claims courts for control operators, appeals and imports Reconciliation Act 34 of 1995. GenN116
the areas of Thohoyandou, Malamulele, in terms of the Fertilizers, Farm Feeds, GG37358/21-2-2014.
Selected aspects of the • to establish and regulate the adminis- person or to determine any physical in-
tration and maintenance of the National formation of the person other than the
Criminal Law (Forensic Pro- Forensic DNA Database of South Africa; sex of that person.
cedures) Amendment Act • to provide for the conditions under Forensic DNA profile means the results
which the samples or forensic DNA obtained from forensic DNA analysis of
37 of 2013 profiles derived from the samples may bodily samples taken from a person or
The Criminal Law (Forensic Procedures) be retained or the periods within which samples taken from a crime scene, pro-
Amendment Act 37 of 2013 was pub- they must be destroyed; and viding a unique string of alpha numeric
lished as GN52 in GG37268/27-1-2014. • to provide for the use of forensic DNA characters to provide identity reference:
The Act will commence on a date to be profiles in the investigation of crime and Provided this does not contain any infor-
proclaimed. the use of such profiles in proving the mation on the health or medical condi-
innocence or guilt of persons before or tion or mental characteristic of a person
during a prosecution or the exoneration or the predisposition or physical infor-
Purpose of the Act of convicted persons. mation of the person other than the sex
The purpose of the Act is, among others – of that person.
• to amend the Criminal Procedure Act
51 of 1977 so as to provide for the tak-
What is a forensic DNA
ing of bodily samples from certain cat- analysis? Powers in respect of
egories of persons for the purposes of buccal, bodily and crime
forensic DNA analysis; A forensic DNA analysis is the analysis
• to provide in particular for the protec- of sections of the DNA of a bodily sam-
scene samples
tion of the rights of women and children ple or crime scene sample to determine (ss 36D and 36E)
in the taking of DNA samples; the forensic DNA profile: Provided that
• to add to the Criminal Procedure Act, this does not relate to any analysis per- An authorised person must take a buccal
in sch 8, a list of offences in respect of taining to medical tests or for health sample or cause the taking of any other
which DNA samples must be taken; purposes or mental characteristic of a bodily sample of any person –

- 48 -
NEW LEGISLATION
• after arrest but before appearance in court to be formally

charged for any sch 8 offence;
• released on bail in respect of a sch 8 offence (if not taken on
arrest);
• on whom summons has been served in respect of a sch 8
offence;
• whose name appears in the National Register of Sex Offend-
ers; or
• charged or convicted by a court in respect of any offence that
the minister has by notice in the Government Gazette declared
to be an offence for the purposes of s 36D.
The authorised person must supervise the taking of a buccal
sample from a person who is required to submit such sam-
ple and who requests to take it himself or herself. The station
commander or other relevant commander must within 30 days
furnish every bodily sample to the authorised officer, who
must carry out a forensic DNA analysis on every such sample
in terms of ch 5B of the South African Police Service Act 68 of
1995.
Which offences are sch 8 offences?

• Treason.
• Sedition.
• Public violence.
• Murder.
• Any offence referred to in part I or part II of sch 1 to the Im-
plementation of the Rome Statute of the International Criminal
Court Act 27 of 2002.
• Culpable homicide.
• Rape or compelled rape as contemplated in ss 3 and 4 of the
Criminal Law (Sexual Offences and Related Matters) Amend-
ment Act 32 of 2007, respectively.
• Sexual assault, compelled sexual assault or compelled self-
sexual assault as contemplated in ss 5, 6 or 7 of the Criminal
Law (Sexual Offences and Related Matters) Amendment Act,
respectively.
• Any sexual offence against a child or a person who is men-
tally disabled as contemplated in part 2 of ch 3 or the whole of
ch 4 of the Criminal Law (Sexual Offences and Related Matters)
Amendment Act, respectively.
• Robbery.
• Kidnapping.
• Child stealing.
• Assault, when a dangerous wound is inflicted.
• Arson.
• Breaking or entering any premises, whether under the com-
mon law or a statutory provision, with intent to commit an
offence.
• Theft, whether under the common law or a statutory provi-
sion.
• Escaping from lawful custody, where the person concerned
is in such custody in respect of any offence referred to in sch
1, or is in such custody in respect of the offence of escaping
from lawful custody.
• Any –
˗ offence under the Firearms Control Act 60 of 2000, which
is punishable with imprisonment for a period of five years or
longer in terms of the said Act;
˗ offence under the Explosives Act 15 of 2003, which is punish-
able with imprisonment for a period of five years or longer in
terms of the said Act;
˗ convention offence or specified offence as defined in s 1 of
the Protection of Constitutional Democracy against Terrorist
and Related Activities Act 33 of 2004;
˗ offence of trafficking in persons as defined in s 1 of the
Prevention and Combating of Trafficking in Persons Act 7 of
2013; or
˗ offence of torture as defined in the Prevention and Combat-
ing of Torture of Persons Act 13 of 2013.
• Any conspiracy, incitement or attempt to commit any offence
referred to in this schedule.
q

- 49 -
Employment law update
Talita Laubscher BIur LLB (UFS) LLM Monique Jefferson BA (Wits) LLB (Rho-
(Emory University USA) is an attorney des) is an attorney at Bowman Gilfillan in
at Bowman Gilfillan in Johannesburg. Johannesburg.
Payment for accrued the employment contract providing for tion. He found that where employees are
the forfeiture of annual leave were un- frustrated from taking annual leave they
annual leave on enforceable as they were less favourable should then invoke the enforcement pro-
termination of than what is provided in the BCEA. visions of the BCEA.
The applicant further argued that, at Van Niekerk J found that there was
employment the very least, he should be entitled to no reason to depart from the decision in
In Ludick v Rural Maintenance (Pty) Ltd payment in respect of annual leave ac- the Jooste case where claims for accrued
[2014] 2 BLLR 178 (LC) the Labour Court crued during the second annual leave cy- annual leave pay were limited to annual
considered the accumulation and forfei- cle as, in terms of the BCEA, an employer leave not taken in the current annual
ture of statutory annual leave granted in must grant annual leave not later than leave cycle and the immediately prior
terms of the Basic Conditions of Employ- six months after the end of the annual annual leave cycle. Van Niekerk J stated
ment Act 75 of 1997 (BCEA) with refer- leave cycle in which it accrued. The re- that, in terms of the BCEA, an employer
ence to two conflicting decisions on this spondent argued that the applicant was is obliged to grant employees leave be-
issue. not entitled to any accrued annual leave fore the expiry of the six-month period
In the Ludick case, the applicant em- pay as such leave due to the applicant following the annual leave cycle in which
ployee had worked for the respondent had been forfeited in accordance with it accrued.
for 27 months and had not taken any the terms of his employment contract. This does not mean that the employee
annual leave during this period. The ap- The applicant referred to the case has the right to take leave at any time
plicant therefore claimed to be paid in of Jardine v Tongaat-Hulett Sugar Ltd in that period. Once annual leave has ac-
respect of all the annual leave that had [2003] 7 BLLR 717 (LC) in which it was crued the timing of leave should be the
allegedly accrued to him over the two an- found that statutory annual leave not subject of agreement between the par-
nual leave cycles on the termination of taken within six months after the end ties. In the absence of agreement, the
his employment. The respondent argued of the annual leave cycle in which it ac- employer may decide the timing of an-
that the applicant had no such entitle- crued is not automatically forfeited nor nual leave and provisions in an employ-
ment as, in terms of its leave policy and is any right to accrued annual leave pay ment contract entitling the employer to
the applicant’s employment contract, all ever forfeited. Van Niekerk J considered determine the timing of annual leave
his annual leave had been forfeited be- this view with reference to a different were therefore enforceable.
cause he had failed to take it. approach that was followed in Jooste Van Niekerk J found, however, that the
Van Niekerk J considered the provi- v Kohler Packaging Ltd [2003] 12 BLLR forfeiture of annual leave was a separate
sions of the BCEA that require an em- 1251 (LC) in which it was held that an issue to the timing of the annual leave.
ployee, on termination of employment, employee could only be paid on termina- In this regard, Van Niekerk J held that an
to be paid in respect of annual leave action of employment in respect of statu- employee does not forfeit annual leave
crued but not granted before the date tory annual leave that had accrued in the or the right to be paid in lieu of annual
of termination, together with a pro rata annual leave cycle immediately preced- leave on termination of employment if
amount for leave accrued in the current ing that during which the termination the annual leave is not taken within the
annual leave cycle. The applicant argued took place and all other annual leave is six-month period following the annual
that he was entitled to accumulate an forfeited. leave cycle in which the leave accrued.
unlimited amount of annual leave as the Van Niekerk J found that the purpose But this applies only to statutory annual
BCEA is silent on the issue. of the BCEA is to ensure that employees leave in the current annual leave cycle
The applicant also argued that s 40(b) take the annual leave that they are en- and the immediately preceding annual
of the BCEA provides that an employee is titled to and this purpose would be cir- leave cycle.
entitled to be paid for ‘any period of an- cumvented if employees were permitted Practitioners should note that the bal-
nual leave … that the employee has not to accumulate annual leave indefinitely ance of authority from the Labour Court
taken’. He alleged that the provisions of and wait to claim payment on termina- now, inter alia, suggests that:

- 50 -
EMPLOYMENT LAW
• Untaken statutory annual leave from ployer may determine the time when the by the BCEA and may be subject to what-
the current annual leave cycle and the employee must take leave. ever conditions are determined by the
immediately preceding leave cycle is not • If an employee is frustrated from tak- employer. Such additional leave could
forfeited and must be paid out on ter- ing leave, he or she must use the en- therefore be accumulated or forfeited
mination. forcement mechanisms contained in the as determined by the employer, and the
• Statutory annual leave from prior leave BCEA. Employees earning below the in- employer may regulate payment in re-
cycles is forfeited and an employee has come threshold prescribed in the BCEA spect of additional annual leave in the
no right to be paid in respect of such (currently R 193 805) may accordingly manner it deems appropriate.
annual leave, unless of course the em- seek enforcement through the labour
ployee’s employment contract or the inspectorate, and employees earning
employer’s leave policy permits such ac- above this threshold may seek specific
cumulation and payment. performance through the Labour Court.
• Annual leave must be taken by agree- • Leave granted in addition to an em-
ment between the employer and the ployee’s BCEA/statutory entitlement is
employee and failing agreement, the em- not subject to the limitations prescribed
or by the Labour Court. cepted, further runs the risk of the dis-
I will therefore answer your question missal being found substantively unfair.
by focussing on what recourse the em- By way of example, let us assume that
ployee could possibly have under the cir- an employee working in a supermarket
cumstances you have described. was charged for unauthorised posses-
First, let us assume that having been sion of company property when found
dismissed before the inquiry was con- with a packet of tablets that the employ-
cluded, the employee refers an unfair er sells. At the internal inquiry the em-
dismissal dispute to the CCMA. ployer leads uncontested evidence that
The employee has a right to challenge the employee was found in possession
the substantive fairness of his or her dis- of the tablets and that the store sells the
Moksha Naidoo BA (Wits) LLB (UKZN) missal (ie, whether the employer had a very same type of tablets. Without af-
is an advocate at the Johannesburg Bar. fair reason to dismiss the employee) and fording the employee an opportunity to
the procedural fairness of the dismissal defend himself or herself, the employer,
(ie, whether the dismissal was in accord- for some reason, makes the decision that
ance with a fair procedure). In terms of the employee is guilty and dismisses him
Question: s 192 of the Labour Relations Act 66 of or her.
Does an employer have the right to dis- 1995 (LRA), once a dismissal is common The employee then refers a dispute
miss an employee in the middle of a dis- cause, the inquiry turns on whether the to the CCMA and at arbitration the em-
ciplinary inquiry without the chairper- employer can prove the substantive and ployer leads the same evidence that
son’s verdict with the employer stating procedural fairness of the dismissal (this was led at the inquiry, however, when
that the reasons provided for the dis- as opposed to whether the employee can it is time for the employee to raise his
missal were that the chairperson would prove the dismissal was substantively or her defence, he or she produces a till
have found the employee guilty and and procedurally unfair). slip from a chemist indicating that he or
would have dismissed him or her any- she bought the tablets on the same day
way and also the employer saying that it Substantive fairness he or she was found to be in possession
had difficulties in finalising the discipli- Arbitration at the CCMA is a de novo hear- of them and further that the till slip in-
nary hearings? ing, meaning the hearing starts afresh dicates that the purchase was made at
with the arbitrator sitting as chairperson 13:30, which was during his or her lunch
Answer: tasked with deciding the fairness of the time.
While I understand what you seek advice dismissal. As mentioned, the onus of As the employer cannot dispute these
on, I think the more appropriate ques- proving the fairness of a dismissal rests facts, the arbitrator finds the tablets did
tion is whether the employee would be with the employer, thus he or she will be- not belong to the employer and hence
successful in claiming an unfair dismiss- gin by leading evidence first. Thereafter the dismissal was substantively unfair
al should an employer act in the manner the employee will lead evidence in sup- and awards the employee retrospective
and under the circumstances you have port of his or her case. Once both par- reinstatement. Had the employer con-
mentioned. ties have led their respective cases, the cluded the internal inquiry, he or she
One should remember there is nothing arbitrator will make a decision. would have become aware of the em-
in law preventing an employer from dis- The reason I am mentioning these ployee’s defence and would have taken a
missing an employee for any reason he points is because unless the employer more informed decision. Failure to do so
or she thinks fair or in accordance with knows what the employee’s defence or in this example resulted in the employer
any procedure he or she thinks is rea- explanation is with regard to the reason having to reinstate the employee and
sonable. Whether or not the employer’s for his or her dismissal (which would paying his or her normal salary from the
subjective views will stand the test of normally have been set out by the em- date of dismissal to the date of reinstate-
fairness is a different issue and will be ployee at an internal inquiry); the em- ment.
decided by an independent third party, ployer runs the risk of becoming aware
either by the Commission for Concilia- of such version only at the arbitration Procedural fairness
tion, Mediation and Arbitration (CCMA) and, if the employee’s explanation is ac- In terms of procedural fairness, the first

- 51 -
EMPLOYMENT LAW C M Y CM MY CY CMY K
question is whether the employer was obliged, in terms of an

employment contract or collective agreement or past practice,
to have a formal hearing before dismissing the employee. In
the absence of such an obligation, the only duty an employer
has in terms of procedure is to give the employee an opportu-
nity to be heard before making a decision.
In Old Mutual Life Assurance Co SA Ltd v Gumbi 2007 (5) SA
552 (SCA) the court said the following with regard to a pre-dis-
missal hearing: ‘The right to a pre-dismissal hearing imposes
upon employers nothing more than the obligation to afford
employees the opportunity of being heard before employment
is terminated by means of a dismissal.’
While one should be alive to the fact that subsequent SCA
decisions have found that one cannot read, as a tacit term in
an employment contract, that an employee has a right to a pre-
dismissal hearing and that such right exists only in statute,
this debate does not detract from the advice I am offering for
the simple reason that the aforementioned example is with re-
gard to an employee challenging his or her dismissal at the
CCMA and is not suing in terms of breach of employment con-
tract in a court of law.
Returning to our example, let us assume the employer does
have an obligation to set down and conduct a formal hearing.
Should the employer dispense with the inquiry without com-
pleting this formal process, any subsequent dismissal would
be seen as procedurally unfair.
Similarly, if the employer is not obliged to conduct a hearing
as described above, then the question is whether or not the
employer gave the employee an opportunity to be heard before
dismissing him or her. It can hardly be said that the employee
in the example above, was given an opportunity to be heard
when the employer dispensed with the inquiry in the middle
of the process. If found the opportunity was not given, the
dismissal would be seen as procedurally unfair.
To summarise, given the risks the employer runs, both from
a substantive and procedural point of view, and taking into ac-
count the remedies open to employees if their dismissals are
found to be unfair, my advice would be that it is never a good
idea for an employer to dismiss an employee before the inter-
nal inquiry is concluded.
If the employee is the cause for delaying the finalisation of
the inquiry, then the employer has available the option of plac-
ing the employee on unpaid suspension pending the conclu-
sion of the inquiry. In this way the employer is not prejudiced
by an employee who intentionally delays the finalisation of the
inquiry with the aim of prolonging their employment for finan-
cial reasons.
Do you have a labour law-related

question that you would like an-
swered? Please send your question
to [email protected]

- 52 -
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