At the heart of the appeal in Limpopo Provincial Council of the South African Legal Practice Council v Chueu Incorporated Attorneys and Others (459/22) [2023] ZASCA 112 lies the question of liability of all directors of a law Firm for financial misconduct committed by one director.

Chueu Incorporated Attorneys (“the Firm”) specialised in personal injury matters.A number of complaints to the Limpopo Legal Practice Council (“LPC”) from members of the public represented by the Firm in litigation against the Road Accident Fund (“RAF”) concerned failure to account to clients for monies claimed and received from the RAF; and failure to respond to communications or deal properly with clients’ instructions; and a complaint to the Gauteng LPC from the RAF about a double payment of some R29 million erroneously made by the RAF to the Firm and not repaid, but instead appropriated by the Firm (the “financial improprieties”).

The LPC brought an urgent application for the suspension of all directors of the Firm under Sections 43 and 44 of the Legal Practice Act (LPA), on grounds of the financial improprieties.

The other directors of the Firm argued that they should not be held accountable for disciplinary measures for the financial improprieties of another director. The common thread in the defences of the other directors was that each of them held only a minor shareholding and had no involvement in the financial operations of the Firm. They claimed that they received no financial statements, were not consulted on financial matters by the director concerned; and did not share in the distribution of profits from the improprieties; and that they were effectively kept in the dark.

The judgment of the court was unequivocal: Each director bears a fiduciary duty towards the company, and the defence of ignorance regarding financial matters, when faced with allegations of misappropriation of clients’ money, does not absolve directors from their responsibilities. Relying on Hewetson v Law Society of the Free State 2020 (5) SA 86 (SCA)  the Court emphasised that “legal practitioners cannot escape liability by contending that they had no responsibility for the keeping of the books of account or the control and administration of the trust account”. The court went further to quote Hepple v Law Society of the Northern Provinces [2014] 3 All SA 408 (SCA) that “for an attorney to explain trust deficits on the grounds thathe or she had no involvement in the financial affairs of the Firm ‘is no defence at all’”.

The Court concluded that by failing to be involved in the oversight of financial matters the directors were derelict in their duties. The facts presented in this case were thus sufficient to warrant suspension of all the directors of the Firm from practising as attorneys for a period of six months, pending the finalisation of investigation into their conduct. The principle confirmed in this case is clear: In disciplinary proceedings all the directors of a law firm can be held responsible for the financial misconduct of one of them. The court’s judgment emphasized that each director bears a fiduciary duty towards the company, and a defence of ignorance regarding financial matters does not absolve directors from their responsibilities.

The legal position prior to the Constitutional Court decisions in EB (born S) vs ER (born B) and Others; KG v Minister of Home Affairs and Others ZACC 32 [2023] were where parties had elected to conclude an antenuptial contract, upon dissolution of the marriage by divorce, a court may, where it deemed it just and equitable to do so, may make an equitable redistribution order that the assets of one spouse may be transferred to the other, in terms of Section 7(3).

Section 7(3) reads as follows:

A court granting a decree of divorce in respect of a marriage out of community of property –

• entered into before the commencement of the Matrimonial Property Act 1984, in terms of an antenuptial contract by which community of property, community of profit and loss and accrual sharing in any form are excluded;

• entered into before the commencement of the Marriage and Matrimonial Property Law Amendment Act, 1988, in terms of section 22(6) of the Black Administration Act, 1927 (Act 38 of 1927), as it existed immediately prior to its repeal by the said Marriage and Matrimonial Property Law Amendment Act, 1988; or;

• entered into in terms of any law applicable in a former homeland, without entering into an antenuptial contract or agreement in terms of such law,

may subject to the provisions of subsections (4), (5) and (6), on application by one of the parties to that marriage, in the absence of any agreement between them regarding the division of their assets, order that such assets, or such part of the assets, of the other party as the court may deem just, be transferred to the first-mentioned party.

The purpose of Section 7(3) was to introduce a remedy for marriages which were entered into prior to 1 November 1984, when spouses could only elect to be married in community of property or out of community of property, without the accrual regime (“old ANC”). The section was aimed at compensating for the fact that spouses in such old ANC marriages, prior to November 1984, did not have the option to incorporate the accrual regime as a default regime when electing to conclude an antenuptial contract (“new ANC”).

Section 7(3) generally provides the Court hearing a divorce action with a discretion, when dissolving a marriage out of community of property concluded on or before 1 November 1984, to transfer assets or a part of assets from a spouse who is in a financially stronger position to the spouse who is considered to be financially weaker.

In EB (born S) vs ER (born B) and Others the Court considered whether Section 7(3) of the Divorce Act should also be applicable to marriages dissolved by the death of one of the spouses.

The Constitutional Court had to decide whether it is justifiable that spouses whose marriages terminate by divorce are treated differently from those whose marriages terminate by death, because the former class has the benefit of the redistribution remedy whereas the latter class does not. The Court held that exclusion of the redistribution remedy in the case of the dissolution of an “old ANC” marriage by death is a differentiation that does not serve a legitimate government purpose and amounts to unfair discrimination in terms of Section 9 of the Constitution.

In KG v Minister of Home Affairs and Others ZACC 32 [2023] the High Court held that there was unfair discrimination under Section 9(3) of the Constitution insofar as spouses in “old ANC” marriages, unlike spouses in “new ANC” marriages, had the option to adopt or reject the accrual regime, yet only spouses in “old ANC” marriages were given the redistribution remedy. Economically disadvantaged spouses in new “ANC marriages” were deprived of a benefit given to economically disadvantaged spouses in “old ANC” marriages, based solely on the date of marriage.

The High Court held that the constitutional validity of Section 7(3) should not be considered solely, as at the time when spouses conclude their antenuptial contract, there may have been other legitimate reasons for spouses to exclude the accrual system, despite wealth disparities. Inequality may manifest itself during the course of the marriage, when “a distortion is caused by the fact that one spouse contributes directly or indirectly to the other’s maintenance or the increase of the other’s estate without any quid pro quo,” usually in the case of woman.

In this situation Section 7(3) discriminates against spouses indirectly on the grounds of gender, because women who conclude a “new ANC” marriage may experience the same hardship as women who concluded “old ANC” marriages. Women in “new ANC” marriages can face significant hardship and impairment of their human dignity upon divorce, if their contributions to their spouse’s estate are not recognized. The court held that the differentiation in treatment is not justified by the argument of choice, because many prospective spouses may not have a genuinely free choice when signing antenuptial contracts.

The Constitutional Court agreed and declared the differentiation between old and new ANC marriages to be an unjustifiable indirect discrimination based on gender and the provisions making the application of section 7(3) dependent on the date of the marriage to be unconstitutional. The Constitutional Court therefore upheld the declaration of constitutional invalidity by the High Court, and suspended its order for 24 months to allow Parliament to rectify the legal issues identified by the court.

During this interim period of 24 months the Matrimonial Property Act, in conjunction with Section 7(3), will provide protection for spouses in old and new ANC marriages, regardless of whether the marriage ends through divorce or death. This extension of the redistribution remedy means that all spouses, irrespective of when they were married, can benefit from these legal protections.

This judgment can be seen as a necessary step towards achieving equality and fairness in marriage dissolution, in keeping with South Africa’s international law obligations and the principles enshrined in the Bill of Rights. The decision highlights the persistent inequalities within the institution of marriage and represents a positive move by the courts to protect the most vulnerable individuals in society. As the High Court stated in EB (born S) vs ER (born B) and Others, it is clear that full gender equality has not yet been achieved in South Africa. The measures implemented by the Constitutional Court through this judgment aim to ensure that no party is left at a disadvantage at the dissolution of a marriage, especially in cases where power imbalances may have led to unfairness in the marriage contract. As a result, the redistribution discretion is now available to all marriages out of community of property without accrual, regardless of the date on which the parties were married. Even if the parties signed an antenuptial contract to the contrary, they will still be entitled to request equitable division of assets accrued over the duration of their marriage.

The amendments place new obligations on trustees and compel them to:

a)   keep an updated record of all the “beneficial owners”* under a trust. Trustees must complete and submit the register containing the required information to the Master of the High Court, and update it as necessary;

b)   disclose their position as trustee to any “accountable institution”** with which the trust engages, and disclose that the relevant transaction or business relationship relates to trust property;

c)   ensure that details of all distributions, cash flow and loans by the trust to the beneficial owners thereof are reported to SARS annually;

d)   report the demographic information of the trustees and beneficial owners to SARS annually;

e)   keep records of all accountable institutions with which the trust engages during a year;

f)    disclose the records so obtained and kept to official bodies upon request.

Failure to comply with the required record keeping and reporting duties is a criminal offence punishable by up to five years imprisonment or payment of a fine of R10 million by the trustees.

The Master’s Portal to which the registers of beneficial ownership should be uploaded is operational.  Trustees should ensure that they submit the required details as soon as possible.

Should you be a trustee of a trust, Cluver Markotter can assist you with the submission of the records to the Master of the High Court.

Please contact Alicia Cupido-Woodman for more information and assistance at email address  aliciac@cluvermarkotter.law or telephone number 021 808 5655.

* “beneficial owner”, in respect of the provisions of a trust instrument, means—

(a)   a natural person who directly or indirectly ultimately owns the relevant trust property;

(b)   a natural person who exercises effective control of the administration of the trust arrangements that are established pursuant to a trust instrument;

(c)   (i) each founder of the trust; or
(ii) if a founder of the trust is a legal person, a person acting on behalf of a partnership or in pursuance of the provisions of a trust instrument, the natural person who directly or indirectly ultimately owns or exercises effective control of that legal person or partnership or the relevant trust property or trust arrangements pursuant to that trust instrument;

(d)   (i) each trustee of the trust; or
(ii) if a trustee of the trust is a legal person or a person acting on behalf of a partnership, the natural person who directly or indirectly ultimately owns or exercises effective control of that legal person or partnership; and

(e)   (i) each beneficiary referred to by name in the trust instrument or other founding instrument in terms of which the trust is created; or
(ii) if a beneficiary referred to by name in the trust instrument is a legal person, a partnership or a person acting on behalf of a partnership or a person acting in pursuance of the provisions of a trust instrument, the natural person who directly or indirectly ultimately owns or exercises effective control of that legal person or partnership or the relevant trust property or trust arrangements pursuant to that trust instrument”.

** “accountable institution” has the meaning defined in section 1 (1) of and Schedule 1 to the Financial Intelligence Centre Act, 2001 (Act No. 38 of 2001).

Catherine hails from Cape Town.

Her particular field of expertise is in Family and Matrimonial Law.

Having been responsible for managing and running the Family Law Department at her previous firm, Catherine is ideally poised to use her skills at Cluver Markotter.

These include:

• Drafting pleadings and applications for the various courts
• A sound knowledge on various matters pertaining to matrimonial law and application of the Children’s Act 38 of 2005.
• Mediating with opposing parties in order to reach settlement.
• Drafting of parental plans and the implementation and registering thereof.
• Enforcement of parental right and responsibilities and the appointment of experts to safeguard the best interests of the child/children.
• Assistance with maintenance applications and hearings.

For the duration of the NSOD, at all the alert levels declared from time to time, the Regulations have prohibited the execution of eviction orders, unless a court is of the opinion that it is not just or equitable to suspend or stay the eviction order until after the lapse or termination of the NSOD (or in the initial alert levels, until the lapse of a particular alert level).

Under the Regulations the courts must have regard, in addition to any other relevant consideration, to:

1. 1. the need, in the public interest for all persons to have access to a place of residence and basic services to protect their health and the health of others and to avoid unnecessary movement and gathering with other persons;
   2. any restrictions on movement or other relevant restrictions in place at the relevant time in terms of these Regulations;
   3. the impact of the disaster on the parties;
   4. the prejudice to any party of a delay in executing the order and whether such prejudice outweighs the prejudice of the persons who will be subject to the order;
   5. whether any affected person has been prejudiced in their ability to access legal services as a result of the disaster;
   6. whether affected persons will have immediate access to an alternative place of residence and basic services;
   7. whether adequate measures are in place to protect the health of any person in the process of a relocation;
   8. whether any occupier is causing harm to others or there is a threat to life; and

whether the party applying for such an order has taken reasonable steps in good faith, to make alternative arrangements with all affected persons, including but not limited to payment arrangements that would preclude the need for any relocation during the national state of disaster.

These Regulations apply not only to property owners who obtain eviction orders during the NSOD, but also to those who had obtained eviction orders before the NSOD came into effect, with execution dates falling within the NSOD.

In both these instances the effect of the stay of execution has been that owners have been deprived of property rights for an indeterminate period of time, as long as the NSOD persists.

The case histories of two of our clients faced with this unfortunate scenario are as follows.

Client X obtained an eviction order in terms of the Prevention of Illegal Eviction from and Unlawful Occupation of Land Act 19 of 1998 (“PIE”) during the early stages of the NSOD, and the Court ordered a stay of the execution of the eviction order until after the lapse or termination of the NSOD.

Client Y obtained an eviction order in terms of the Extension of Security of Tenure Act, Act. 62 of 1997 (“ESTA”) before the NSOD (which order was confirmed on review by the Land Claims Court), but the date of execution of the eviction order fell within the NSOD.

In both cases we successfully brought applications for the execution of the eviction orders to go ahead during the NSOD, arguing that it would not be just and equitable to suspend or stay the execution of the eviction orders until after the lapse or termination of the NSOD. In both cases the arguments were based on the particular set of facts; and two recent judgments of the Western Cape High Court could be relied on:

• Shevel v Alson Development Sea Point (Pty) Ltd and another [2021] JOL 49448 (WCC) (“Shevel”); and
• Nelson and Another v Samuels and Others (2350/2020) [2021] ZAWCHC 58 (29 March 2021 (“Nelson”).

In these judgments the Court took into account that when the limitation on evictions was first introduced (with an initial NSOD alert level 5) the movement of persons outside of their places of residence was severely restricted. It was then more difficult for persons to go out and seek alternative accommodation, and well-nigh impossible to move one’s belongings. In the Shevel and Nelson judgments the Court noted that the country had moved away from those initial restrictions, allowing house-hunting and moving house in practically the same way as before the initial declaration of the NSOD. The Court in Shevel and Nelson found that on the particular set of facts of each of these cases it would not be just and equitable to suspend the execution of the eviction orders until after the lapse or termination of the NSOD.

Should you have any questions regarding evictions under the national state of disaster or the application to execute upon an eviction order during the national state of disaster, please contact us at 021 808 5600.

Not many businesses can claim to have survived and prospered for 130 years.  Cluver Markotter celebrated this milestone on 1 May 2021.

It all began when Paul August Carl Dietrich (Paul) Cluver was admitted as an attorney and notary public in 1891 and began practicing under the name of Paul D Cluver in the Eikestad.

He was a well-known figure in Stellenbosch – very community-minded and concerned with the welfare and upliftment of the less fortunate.  He also served as mayor of Stellenbosch from 1914 to 1921 and as a member of the Provincial Council from 1927 to 1930.

The law office was housed at 6 Bird Street – right opposite where Cluver Markotter stands today.

Joining Paul in business were two of his brothers, FA and AH Cluver, who were admitted as assistants in 1916.

In 1932, the firm underwent a name change and became Paul & AH Cluver (FA Cluver having passed away in 1921).

Paul Cluver died in 1944 but his brother AH Cluver continued in the practice – amassing a total of 65 years in harness.

In 1950 his son, Ralph, joined forces with his father and this was how things remained until the retirement of AH Cluver in 1965, who, sadly, passed away a year later.

By 1967 the firm comprised four partners – Messrs R Cluver, P van Velden, J Allwright and J Vosloo.  As the seventies dawned, Allwright and Van Velden had moved on.  In 1972, JAL de Waal (Koos) joined as partner.  His son, Arend, became a director of Cluver Markotter in 2000.

Now to the Markotter side of the firm:  August Friedrich Markotter established himself as a co-partner in the firm of Krige & Markotter in Stellenbosch in 1903.

His name (Oubaas Mark) became synonymous with rugby.  For 50 years he was intimately involved in Maties and SA Rugby.

In 1938, his son, Christoph, joined as a partner and the name of the firm became, AF Markotter en Seun.

Another lawyer and partner, Abraham de Villiers, the father of Dr Wim de Villiers, the current rector of Stellenbosch University, joined the pair in 1945.

Over time, Jan Vosloo (1953) and Gys Steyn (1960) were also made partners in the business of Paul and AH Cluver.

The next development was the amalgamation of the firms, AF Markotter en Seun and Hofmeyer en Marais.  The name of the amalgamated firm became Markotter, Basson en Marais.

In August 1970, the partnership with Christoph Markotter was disbanded.  JAA Basson and PG Marais continued operating the practise under the original name.

Then, on 1 May 1973, the firm of Paul & AH Cluver merged with Markotter, Basson and Marais and Cluver and Markotter was formed.

The partners of the new union were RP Cluver, JHA Vosloo, JAL de Waal and JAA Basson.  They were joined in 1980 by Paul Meaker.

In September 1982 another union took place; this time with the law practice of Smith and Zetler.  Cluver Markotter thus gained the services of Gawie Erasmus.

Dr Max Loubser became a partner in 1983.  Jan Vosloo retired in 1987 and JW (Kobus) Basson joined in 1988.

Things remained thus until the soon after the 100th birthday of the firm (1991).

In 1993 local “rivals”, Meintjes and Champion merged with Cluver and Markotter.  This was when Peter Hill, who joined Meintjes and Champion in 1984, became a partner in Cluver Markotter.

Anton Melck joined the firm in 1997 for a stint until 2000 and rejoined in 2003.

Around 1996 the union with Hofmeyr, Herbstein and Gihwala took place to form Hofmeyr, Herbstein, Gihwala and Cluver.  In 2000 Cluver Markotter re-established itself as a separate practice under the name “Cluver Markotter”.  Gawie Erasmus retired in 1996 as did Kobus Basson who went into private business.

Rodney Africa became a director in 2001 until 2008.  That same year, after 35 years in the saddle, Koos de Waal retired as director and stayed on as a consultant for 2 years;  Paul Meaker retired from practising law a year earlier after 27 years of service to the firm.

In 2001 a number of younger directors were appointed, namely Derick Swart, Danie Cronje and Wynand Prins who in 2012, 2016 and 2019 respectively started practising for their own accounts.
In the subsequent intervening years 11 directors of the current complement of 15 directors joined our board:  Dr Richard Stevens (in 2005); Lize Pecoraro (in 2008); James Lamprecht and Marieke Wild (in 2012); Luzanne Brink, Koos Geyser and Sisteen Geyer (in 2014); Lorinda van Niekerk (in 2015); Marike Koen and Brendon Hess (in 2016) and Sherine Roberts (in 2017).

Cluver Markotter currently has a team of 24 qualified attorneys, practising in various specialist fields of law.

With this rich heritage under its belt, Cluver Markotter now turns to the future.  130 years has taught us change is inevitable and moving with the times a necessity.  Today, our team of 24 skilled, qualified attorneys stand at the ready, drawing on the firm’s hard-earned reputation for excellence to provide assistance in all areas of the law, ensuring we’re more than adequately prepared for whatever the next 130 years has in store.

• A surety’s debt is accessory to the principal debt and follows its fortunes, also in respect of prescription. In terms of section 10(2) of the 1969 Prescription Act prescription of a principal debt has the effect that the surety’s debt also becomes prescribed.
• The interruption of prescription resulting from service of summons on or acknowledgement of liability by the principal debtor also interrupts prescription for the surety’s debt.

(See on these rules, Max Loubser, Extinctive Prescription, 2^nd ed, 2019, pp 63-64.)

In the Liberty Group case, Liberty took cession of the rights to payment of commission under an agreement between Charter Life Insurance Company Ltd and a company named ECE, which was subsequently deregistered.  The respondent, Mr Illman, and seven others had signed as sureties and co-principal debtors in solidum with ECE for the payment of commission which ECE could in future owe under the agreement.  The agreement was terminated on 14 March 2011.  On 29 September 2011, Liberty issued summons against all the sureties for outstanding commission owed by ECE, but summons was only served on one of the sureties, Mr September.  Mr September failed to deliver a notice of intention to defend and default judgment was granted against him on 27 January 2012.  Summons was served on the respondent, Mr Illman, approximately five years later, on 31 March 2016.  Mr Illman raised a special plea of prescription in terms of section 11 of the Prescription Act 68 of 1969, as summons was served three years after cancellation of the agreement on 14 March 2011.

Liberty argued that as Mr Illman and Mr September had bound themselves to Liberty as sureties and co-principal debtors in solidum with ECE, they became ‘co-debtors’, and as service of summons on Mr September was within the prescription period, the running of prescription in favour of Mr Illman and all other sureties was interrupted.  Accordingly, it was pleaded, the claim against Mr Illman had not become prescribed.  The High Court upheld Mr Illman’s special plea of prescription.

On appeal to the Supreme Court of Appeal (SCA), Liberty argued that the two sureties were co-debtors, and that service of summons on either of them interrupted the running of prescription in respect of all the sureties.  This argument was based on the rule referred to above, deriving from Roman-Dutch law, that interruption of prescription resulting from service of summons on or acknowledgement of liability by the principal debtor also interrupts prescription for the surety’s debt.  Liberty urged the court to apply this principle also to the converse situation, in other words, to accept that the interruption of prescription in respect of a surety’s debt also interrupts prescription in respect of the principal debt.  According to this argument the further logical extension of the principle would be that interruption of prescription in respect of one surety would also interrupt prescription in respect of a co-surety.  The result would be that service of summons on Mr September within the prescription period would also interrupt the prescription period in respect of Mr Illman and the other co-sureties, allowing Liberty to sue them later, having taken timeous legal action against one of them.

The SCA did not accept Liberty’s argument, on the basis that this would constitute a substantial deviation from the common law principles on suretyship, and there were no cogent reasons to allow this.

The SCA re-affirmed the position in our law that a surety and co-principal debtor does not undertake a separate independent liability as a principal debtor; the addition of the words ‘co-principal debtor’ does not transform his contract into any contract other than one of suretyship.  The surety does not become a co-debtor with the principal debtor, nor does he become a co-debtor with any of the co-sureties, unless they have agreed to that effect.  Accordingly, service of summons on surety A will not interrupt prescription in respect of surety B’s debt:  the prescription period will continue to run and can extinguish surety B’s debt, while surety A, who was sued in time, will be liable for payment.

The appeal was dismissed with costs.

In Association of Mineworkers and Construction Union and Others v Royal Bafokeng Limited and Others [2020] ZACC 1 the court upheld the constitutionality of sections 23(1)(d) and 189(1) of the Labour Relations Act 66 of 1995 (the “LRA”) which effectively allows an employer to conclude a retrenchment agreement with a majority union that will be extended to all employees, including members of a minority union. This means the collective agreement will bind minority trade unions without the employer having consulted with their individual members.

Sections 23(1)(d) and 189(1) of the LRA respectively holds that:
23 (1) A collective agreement binds –
(d) employees who are not members of the registered trade union or trade
unions party to the agreement if –
(i) the employees are identified in the agreement;
(ii) the agreement expressly binds the employees; and
(iii) that trade union or those trade unions have as their members the majority of employees employed by the employer in the workplace.

189(1) (1) When an employer contemplates dismissing one or more employees for reasons based on the employer’s operational requirements, the employer must consult –
(a) any person whom the employer is required to consult in terms of a collective agreement;
(b) if there is no collective agreement that requires consultation –
(i) a workplace forum if the employees likely to be affected by the proposed dismissals are employed in a workplace in respect of which there is a workplace forum; and
(ii) any registered trade union whose members are likely to be affected by the proposed dismissals;
(c) if there is no workplace forum in the workplace in which the employees likely to be affected by the proposed dismissals are employed, any registered trade union whose members are likely to be affected by the proposed dismissals; or
(d) if there is no such trade union, the employees likely to be affected by the proposed dismissals or their representatives nominated for that purpose.

The application was brought by AMCU, one of the minority trade unions at the Royal Bafokeng platinum mine, following a retrenchment of 174 of its members. AMCU challenged these dismissals in the Labour Court (“LC”) and later in the Labour Appeals Court (“LAC”), on the basis that a collective agreement on a retrenchment process which excludes minority unions but purports to extend the agreement to the minority union members was unconstitutional. Their arguments were rejected by the LC and the LAC, which held that the principle of majoritarianism was a policy adopted by the legislature to facilitate orderly collective bargaining, to minimise proliferation of unions and ultimately to democratise the workplace.

In the Constitutional Court the applicants argued that such an exclusion from the consultation process required by section 189(1) limits their right to fair labour practices and also that an interpretation of section 23(1)(d) that would allow a retrenchment agreement to be extended to parties who were not afforded the opportunity to participate in its conclusion was unconstitutional.

On section 189(1) the court ruled that not consulting with employees that belong to a minority union when a collective agreement on retrenchment is concluded, does not limit the right to fair labour practices and, even if it did that, the limitation would be justifiable. The court’s reasons for this decision were that section 23(1) of the Constitution does not expressly or by implication guarantee a right to individual consultation; and because a decision to retrench is not based on individual conduct there is no need for individual consultation. Additionally, the right to consultation is afforded by the LRA and is not a fundamental right deriving from the Constitution. Accordingly, section 189 is a codification of fair procedure for dismissal on the basis of operational requirements, which involves an inquiry into objective factors and differs from the procedure dismissal for misconduct or incapacity which requires an individual enquiry.

Froneman J, who delivered the majority judgment, wrote that a requirement for parallel and individual consultations would undermine the very point of collective bargaining.

‘An individual employee, or even a group of individual employees, has or gave scant bargaining clout, particularly whether the employer is preoccupied with processing dismissal for operational requirements. A majority union, by contrast, wields coercive power, by immediate or future threat of industrial action. It is this power that may sway an employer to agree to benefits on retrenchment, or better yet, fewer or no dismissals.’

On the constitutionality of section 23(1)(d) both judgments agreed that the Constitutional Court had already held that section 23(1)(d) is a constitutionally valid limitation of the right to strike and that the same reasoning apply in this instance. It was also not shown that the extension of collective agreements under section 23(1)(d) infringed the rights of minority union members, because there is still a range of remedies at their disposal. The challenge to section 23(1)(d) was therefore dismissed.

This judgment establishes an important principle in South African labour law: that a majority-driven collective bargaining process on retrenchments complies with Constitutional rights and values. The court accepted that the majoritarian principle protects employees and concluded that “the choice made for the “pre-eminence of collective bargaining in section 189 is not only rational: it is sound, it is fair and it is based on international practice and standards.” It follows that there is no right to further individual or dual consultation in addition to the requirements set out in section 189(1).

FACTS

This case arose from the widely publicised abduction of Zephany Nurse, who was abducted at birth from her biological parents in the maternity ward at a Cape Town hospital.  At the age of 17 she discovered that the woman who raised her was in fact her abductor, who was subsequently prosecuted.  The trial commenced after Zephany had turned 18 and attracted a lot of media attention.

The Centre for Child Law sought a declaration in the Western Cape High Court that section 154(3) of the Criminal Procedure Act, properly interpreted, also protects the anonymity of child victims of crime, and not only child witnesses and accused persons at criminal proceedings.  The alternative declaration sought was that section 154(3), if it fails to provide for that protection, was constitutionally invalid.  A further declaration sought was that the protection in section 154(3) should extend beyond adulthood and should also protect the identity of child accused, witnesses and victims after they turn 18 (referred to as “ongoing protection”).

THE HIGH COURT

The High Court held that the wording of section 154(3) could be purposively interpreted to extend to child victims, but that it should not be interpreted to provide ongoing protection.

THE SUPREME COURT OF APPEAL

On appeal to the Supreme Court of Appeal (“SCA”) the SCA held that section 154(3) was unconstitutional insofar as it did not protect child victims at criminal proceedings, but refused to extend the publication ban on identities of accused persons, witnesses or victims beyond the age of 18 as it was “overbroad” and would infringe on the open justice principle and severely restrict the right of media to impart information.

THE CONSTITUTIONAL COURT

On appeal to the Constitutional Court this court held that the overarching purpose of section 154(3) of the Criminal Procedure Act is child protection, more specifically protection from the potentially harmful effects of publication of their names and identities as a result of being implicated in criminal proceedings.  Because only child accused and child witnesses at criminal proceedings were protected against their identities being published, with no similar protection for child victims, there is a clear gap in the law.

This gap in section 154(3) limits the right to equality and amounts to arbitrary differentiation in that child victims of crime were not offered equal protection and benefit of the law, which is contrary to the best interest of children and their rights to privacy and dignity.

The Constitutional Court therefore confirmed the declaration of invalidity of section 154(3).

With respect to ongoing protection the Constitutional Court held that this is in the best interest of the child and the child’s rights to dignity and privacy require ongoing protection for child accused, witnesses and victims.  This ongoing protection will not constitute a severe encroachment on media freedom.

The Constitutional Court accordingly declared section 154(3) invalid and in the interim ordered that the child victim’s identity be protected and that a person who is subject to the protection of section 154(3) does not forfeit the protection upon reaching adulthood, but is entitled to consent to the publication of their identity, and if consent is refused, a competent court may be approached by the media to request the publication ban to be uplifted.

What progress has been made with electronic registration of deeds in South Africa and what impact could it have in a Lockdown situation?

The process of the registration of deeds is described in section 13 of the Deeds Registries Act 47 of 1937 (“the Deeds Registries Act”). In terms of this section, deeds “shall be deemed to be registered upon the affixing of the Registrar’s signature thereto”. Currently the conveyancer, authorised thereto by the transferor of property by a Power of Attorney, must sign the deed in the presence of the Registrar. Registration then occurs when the Registrar affixes a signature on the deed. Clearly this is currently an “in-person” process and cannot take place electronically.

With the aim of modernising the deeds registration process and to improve the ability of the current registration system to deal with the increased volume of transfers as a result of the Government’s land reform measures, the Legislature introduced the Electronic Deeds Registration Systems Bill in 2017 (“the Bill”). The objective of the Bill is to develop an Electronic Deeds Registration System (“e-DRS”) that can accommodate large numbers of deeds and thereby expedite the process of registering deeds. It is also envisaged that the e-DRS will also result in better turn-around times for the registration process; that it will offer country-wide access to registration services; increase the availability of information; and enhance the accuracy of the registration procedure.

Following the Bill, the Electronic Deeds Registration Systems Act 19 of 2019 (“the Act”) was signed into law in October 2019. However, only section 2 of the Act is currently operational. This section authorises the Chief Registrar of Deeds, subject to the Electronic Communications and Transactions Act 25 of 2002, to establish an “electronic deeds registration system using information and communications technologies for the preparation, lodgment, registration, execution and storing of deeds and documents”.

The Act, and specifically section 6(3), when fully operational, will have the effect that upon electronic registration a deed will be deemed to have been registered in the presence of the Registrar by a property owner or by the conveyancer that has been authorised by a Power of Attorney to act on the owner’s behalf.

Although the Chief Registrar of Deeds will still have the power to issue directives allowing the manual preparation, lodgment, registration, execution and filing of deeds and documents, this Act will effectively replace the manual registration of deeds. It will go a long way to modernise South Africa’s property registration system.

The Act is not without flaws. The main concern is the risk of fraud associated with the electronic lodgment and registration of deeds. There is also the concern that the digitalised systems could malfunction.

Nevertheless, had the Electronic Deeds Registration Systems Act already become successfully operational prior to the Lockdown, it would have done away with much of the “in-person” process of registration and thereby could have prevented most of the backlogs currently experienced in Deeds Offices across South Africa.