Case Law[2024] ZAGPJHC 688South Africa
SA Broadcasting Corporation (SOC) Ltd and Another v Motsoeneng and Others (A2022/046784) [2024] ZAGPJHC 688; [2024] 4 All SA 238 (GJ); 2025 (2) SA 571 (GJ) (30 July 2024)
High Court of South Africa (Gauteng Division, Johannesburg)
30 July 2024
Headnotes
Summary
Judgment
begin wrapper
begin container
begin header
begin slogan-floater
end slogan-floater
- About SAFLII
About SAFLII
- Databases
Databases
- Search
Search
- Terms of Use
Terms of Use
- RSS Feeds
RSS Feeds
end header
begin main
begin center
# South Africa: South Gauteng High Court, Johannesburg
South Africa: South Gauteng High Court, Johannesburg
You are here:
SAFLII
>>
Databases
>>
South Africa: South Gauteng High Court, Johannesburg
>>
2024
>>
[2024] ZAGPJHC 688
|
Noteup
|
LawCite
sino index
## SA Broadcasting Corporation (SOC) Ltd and Another v Motsoeneng and Others (A2022/046784) [2024] ZAGPJHC 688; [2024] 4 All SA 238 (GJ); 2025 (2) SA 571 (GJ) (30 July 2024)
SA Broadcasting Corporation (SOC) Ltd and Another v Motsoeneng and Others (A2022/046784) [2024] ZAGPJHC 688; [2024] 4 All SA 238 (GJ); 2025 (2) SA 571 (GJ) (30 July 2024)
Download original files
PDF format
RTF format
make_database: source=/home/saflii//raw/ZAGPJHC/Data/2024_688.html
sino date 30 July 2024
FLYNOTES:
CIVIL
PROCEDURE – Prescription –
Unlawful
administrative act
–
When
does debt arising from unlawful administrative act fall due –
Special tribunal reviewed and set aside decision
to adopt scheme
but let payments already made under it stand – Alleging
claim for repayment had prescribed –
Debt to state arising
from an unlawful administrative act falls due when act is set
aside – Tribunal was mistaken in
finding repayment claim had
prescribed – Appeal succeeds in part – Prescription
Act 68 of 1969, s 12(3).
IN
THE HIGH COURT OF SOUTH AFRICA
(GAUTENG
LOCAL DIVISION, JOHANNESBURG)
1.
REPORTABLE:
YES
2.
OF
INTEREST TO OTHER JUDGES: YES
3.
REVISED.
30 July 202
Case No. A2022-046784
In the matter between –
SA
BROADCASTING CORPORATION (SOC) LTD
First Appellant
SPECIAL
INVESTIGATING UNIT
Second Appellant
and
GEORGE
HLAUDI MOTSOENENG
First Respondent
AUDREY
RAPHELA
Second Respondent
SULLY
MOTSWENI
Third Respondent
LESLIE
NTLOKO
Fourth Respondent
NOMSA
PHILISO
Fifth Respondent
SIMON
TEBELE
Sixth Respondent
BESSIE
TUGWANA
Seventh Respondent
TSHIFILA
MULAUDZI
Eighth Respondent
NOMPUMELELO
PHASHA
Ninth Respondent
JAMES
AGUMA
Tenth Respondent
CORAM: MUDAU J, MALINDI J
and WILSON J
Summary
The majority (Wilson J,
with whom Mudau J agrees) holds that a debt to the state arising from
an unlawful administrative act falls
due when the act is set aside.
The minority (Malindi J) holds that such a debt falls due when the
state acquires knowledge from
which the unlawfulness of the act can
be inferred.
#####
##### JUDGMENT
JUDGMENT
WILSON
J (with whom MUDAU J agrees)
:
1
The question at the heart of this appeal is when a debt
arising from an unlawful administrative act falls due. Is it when an
organ
of state forms the subjective opinion that the act was
unlawful? Or is it when a court sets aside the act, having been
persuaded
of its unlawfulness? In this judgment, I conclude,
consistently with longstanding authority, that, if “an unlawful
administrative
act is capable of producing legally valid consequences
for so long as the unlawful act is not set aside” (
Oudekraal
Estates (Pty) Ltd v City of Cape Town
2004 (6) SA 222
(SCA)
(“
Oudekraal
”), paragraph 26), then the unlawful
act stands as a fact for that period. It follows from this that a
debt arising from the
unlawful act can fall due only when a court
sets the act aside – in other words, only when the act ceases
to stand as a fact.
The
Mzansi Music Legends scheme
2
This answer to the question is of considerable importance to
the appellants in this case, who are the South African Broadcasting
Association (“the SABC”) and the Special Investigating
Unit (“the SIU”). The SIU investigated the approval
of a
scheme adopted by the SABC on 24 July and 5 September 2016. The
scheme was called the “Mzansi Music Legends” scheme.
It
entailed paying a once-off gratuity of R50 000 to individuals
identified as having achieved “legendary” status,
and who
had, for reasons of past racially discriminatory practice, not been
accorded the kind of financial reward for their work
that successful
artists can expect today, irrespective of their race.
3
Ultimately, the Mzansi Music Legends scheme was only partially
implemented. Fifty-three “music legends” received up to
R50 000 each, but the SABC intended to recognise and pay many more
“legends” before the scheme was frozen and ultimately
abandoned. The total amount paid out under the scheme was some R2.425
million.
4
The Mzansi Music Legends scheme turned out to have been
unlawfully adopted and implemented. This was established during the
SIU
investigation which was carried out as part of a wider probe into
the SABC’s affairs. The unlawfulness of the scheme was conceded
before us, and it is not necessary to explore the reasons for its
unlawfulness in any detail. It is sufficient to remark that the
scheme was adopted and implemented in breach of the SABC’s
internal governance and financial control measures, many if not
most
of which have the force of law through the
Broadcasting Act 4 of 1999
and the
Public Finance Management Act 1 of 1999
.
5
The respondents, all of whom are cited in their personal
capacities, were members of SABC’s executive and operating
committees
at the time the scheme was adopted and implemented. The
appellants say that each of the respondents had a role in adopting
and
implementing the scheme, and that they are all to some extent
responsible for its unlawfulness.
6
Having concluded that the Mzansi Music Legends scheme had been
unlawfully adopted and implemented, the SABC and the SIU applied to
the Special Tribunal to review and set the scheme aside. This had to
be done because the implementation of the scheme constituted
“administrative action”, within the meaning of section 1
of the Promotion of Administrative Justice Act 3 of 2000 (“PAJA”).
The SABC was accordingly not entitled to simply mothball the scheme
and disavow any entitlements the unpaid “music legends”
might have acquired under it.
7
Moreover, although the decision to implement the music legends
scheme was “administrative action” under PAJA, the SABC
was not entitled to review its own decision in terms of that statute.
This is because PAJA gives effect to section 33 of the Constitution,
1996, which affords private parties, and not the state, the right to
just administrative action, together with the right to review
unjust
administrative action under PAJA. It followed from this that,
notwithstanding the fact that the decision to implement the
scheme
constituted administrative action, the route to reviewing and setting
the decision aside had to be through section 1 (c)
of the
Constitution (see
State Information Technology Agency SOC Limited
v Gijima Holdings (Pty) Limited
2018 (2) SA 23
(CC),
paragraphs 28, 29 and 38 to 42). Section 1 (c) of the Constitution
entrenches the rule of law as a founding value in our
constitutional
order, and affords a remedy to set aside any unlawful conduct by an
organ of state, whether or not it constitutes
administrative action.
Where an organ of state engages section 1 (c) of the Constitution to
set aside one of its own administrative
acts, it “self-reviews”
that act.
The
self-review in the Special Tribunal
8
The SABC accordingly applied in the Special Tribunal to
self-review its decision to implement the scheme. The SIU joined the
SABC
in the application, given the SIU’s role in uncovering the
payments made under the scheme and establishing their unlawfulness.
The SIU’s standing to seek the self-review relief arises from
section 4 (1) (c) (i) of the Special Investigation Units and
Special
Tribunals Act 74 of 1996 (“the Special Tribunals Act”),
which entitles the SIU to seek any relief to which
the SABC is
entitled, and which arises from the SIU’s investigations of the
SABC’s affairs.
9
The SABC and the SIU asked the Special Tribunal to set aside
the decision to implement the Mzansi Music Legends scheme. They also
asked that the respondents be held jointly and severally liable to
repay the R2.425 million that had already been disbursed under
the
scheme’s terms. This, the appellants argued, was “just
and equitable” relief under section 172 of the Constitution.
In
advancing this contention, the appellants were no doubt inspired by
the power of a court, under section 8 of PAJA, to award
compensation
as “just and equitable relief” attendant upon the setting
aside of an unlawful administrative act under
that statute.
10
The respondents opposed the application on several grounds,
only two of which need concern me. First, they argued that the SABC
and the SIU had delayed the institution of the self-review
unreasonably. The self-review application was instituted on 21
January
2021, but the decision the SABC and the SIU wished to set
aside was taken more than four years before that. This, the first,
second,
third and seventh respondents contended, was unreasonable.
However, the Special Tribunal decided that the delay was not
unreasonable,
because the SIU report necessary to institute the
proceedings was only finalised on 6 July 2020. The Special Tribunal
found that
there had been no undue delay in finalising the report, or
in instituting these proceedings thereafter. The unreasonable delay
argument accordingly failed.
11
The second relevant point raised before the Special Tribunal
was that the claim for repayment against the respondents had
prescribed.
This contention was based on the proposition that the
repayment claim is a “debt” for the purposes of the
Prescription Act 68 of 1969
. Under
section 12
(3) of the
Prescription
Act a
debt falls due when a creditor acquires knowledge of all the
facts giving rise to the debt. In this case, the respondents
contended,
that meant that the debt fell due when the SABC acquired
knowledge that the decision to implement the Mzansi Music Legends
scheme
was unlawful.
12
The respondents contended that they had no knowledge of the
unlawfulness of the scheme, and that such knowledge could only have
been acquired after they had left the SABC and an interim board had
ordered the forensic investigation that unearthed the scheme
and
established its unlawfulness. The Special Tribunal agreed with these
contentions and held that the SABC acquired knowledge
of the
unlawfulness of the scheme in August 2017, when the forensic
investigation was ordered. That, the Special Tribunal held,
is when
the repayment claim fell due. Since an ordinary debt prescribes after
three years, the repayment claim prescribed, at the
latest, at the
end of August 2020, several months before the self-review was
instituted. On this basis, the Special Tribunal held
that the
repayment claim had prescribed.
13
Ultimately, the Special Tribunal reviewed and set aside the
decision to adopt the Mzansi Music Legends scheme, but let the
payments
already made under it stand. The effect of the Special
Tribunal decision was that those “legends” who had
already been
paid under the scheme could not be pursued for
repayment, but that no further funds could be paid out under the
scheme. The Special
Tribunal declined to order the respondents to
make good on the sums already disbursed under the scheme. This was on
the basis that
any claim that they should repay the disbursed funds
had prescribed.
The
appeal
14
Exercising their right of appeal under section 8 (7) of the
Special Tribunals Act, the SABC and the SIU now challenge the Special
Tribunal’s order before us, but only insofar as the Special
Tribunal refused the claim for repayment. The appeal was argued
on
that basis that a claim for payment arising from an unlawful
administrative act is a “debt” for the purposes of
the
Prescription Act. Like
the Constitutional Court in
Njongi v MEC,
Department of Welfare, Eastern Cape
[2008] ZACC 4
;
2008 (4) SA 237
(CC)
(“
Njongi
”) at paragraph 42, I approach the case on
the reluctant assumption that this proposition is correct. This is
because both
parties accept that it is, and because, on the view I
take of this case, it does not matter whether or not the repayment
claim
is a “debt” that can prescribe.
Did
the repayment claim prescribe?
15
Everyone accepts that the decisions to make payments under the
Mzansi Music Legends Scheme constituted “administrative action”
under PAJA. The only reason that PAJA is not the vehicle through
which the SABC challenged the decisions is that PAJA does not
apply
to organs of state who self-review their own decisions.
16
In
Njongi,
the Constitutional Court dealt with an
unlawful decision to withhold a social grant. The court held that the
payment claim arising
from that unlawful administrative act only fell
due once a court had set aside the decision to withhold the grant
under PAJA, or
once the state had clearly disavowed the lawfulness of
withholding the grant (see
Njongi
paragraphs 41 to 56).
17
This position was modified in
MEC for Health Eastern Cape v
Kirland Investments
2014 (3) SA 481
(CC), in which the
Constitutional Court decided that the state may not after all disavow
(or, in the language used in the judgment,
treat as a “non-decision”
(paragraph 68)) an apparently unlawful administrative act. A
substantive application to review
and set aside that administrative
act must be brought. Until that happens, the act is “effective”
and has legal consequences
(see paragraphs 87 to 106). This
necessarily implies that unlawful administrative acts, though
invalid, exist as facts until
a court sets them aside.
18
It follows from the decisions in
Njongi
and
Kirland
that a debt arising from an unlawful administrative act only falls
due once the administrative act is set aside. So long as the
administrative act stands, it exists as a fact, and prevents a debt
that would otherwise be claimable from falling due. Once the
administrative act is set aside, it ceases to exist as a fact, and
the debt that would have been payable but for the administrative
act
then falls due.
19
It is for this reason that the Special Tribunal was wrong to
conclude that the unlawfulness of the Mzansi Music Legends scheme was
not a “fact” for the purposes of
section 12
(3) of the
Prescription Act, but
a mere conclusion of law, of which the
appellants were not required to be aware before the repayment claim
fell due (see paragraph
65 of the Special Tribunal’s decision).
It is clear from
Njongi
and
Kirland
that unlawful
administrative acts are facts that are treated as having valid legal
consequences until they are set aside. It follows
that the setting
aside of the administrative act is also a “fact” of which
a creditor must be aware before a debt that
would be payable but for
the unlawful act falls due. The knowledge that the SABC had to
acquire before the repayment claim in this
case fell due under
section 12 (3) of the Act was not that the Mzansi Music Legends
scheme was unlawful, but that it had been set
aside.
20
This accords with long-accepted judicial understandings of
when a debt falls due. In
Truter v Deysel
[2006] ZASCA 16
;
2006 (4) SA 168
(SCA), at paragraph 16, the court held that, “for the purposes
of the [Prescription] Act, the term 'debt due' means a debt,
including a delictual debt, which is owing and payable. A debt is due
in this sense when the creditor acquires a complete cause
of action
for the recovery of the debt, that is, when the entire set of facts
which the creditor must prove in order to succeed
with his or her
claim against the debtor is in place or, in other words, when
everything has happened which would entitle the creditor
to institute
action and to pursue his or her claim.” If an unlawful
administrative act stands as a fact and has legal consequences
until
it is set aside, then its setting aside must be one of the things
that must have “happened” before the creditor
can pursue
their claim.
21
Moreover, in
Trinity Asset Management Pty Limited v
Grindstone Investments 132 (Pty) Ltd
2018 (1) SA 94
(CC), it was
observed, at paragraph 40 that “it is a fundamental principle
of prescription that it will begin to run only
when the creditor is
in a position to enforce his right in law, not necessarily when that
right arises”. Although that quote
is harvested from the
minority judgment, it is a point with which the majority took no
issue (see paragraphs 96 to 100).
22
It follows from this that a party wishing to recover a debt
that would be due but for an unlawful administrative act must first
set that act aside before the debt can be claimed. This they may do,
it is true, by seeking the setting aside of the unlawful act
and the
payment of the debt in the same proceeding, but that does nothing to
change the fact that the debt is only due once the
unlawful act is
set aside. A court could not order the payment of the debt without
setting the unlawful act aside, but it could,
as the Special Tribunal
did here, set the act aside without ordering the payment of the debt.
23
To put it another way, had the SABC in this case pursued the
respondents only for the repayment relief, without seeking to set
aside
its own decision to implement the Mzansi Music Legends scheme,
the respondents would have been perfectly entitled to rely on the
ostensive validity of the decisions to make the payments under the
Mzansi Music Legends scheme. They could, and I suspect would,
have
said that they do not owe anything unless and until the
administrative acts authorising the R2.425 million worth of payments
had been set aside.
24
It follows from all of this that the repayment claim did not
fall due when the SABC formed the subjective view that the Mzansi
Music
Legends scheme was unlawful. It would only have fallen due once
the decisions to make payments under the scheme had been set aside.
The Special Tribunal was accordingly mistaken when it held that the
SABC’s repayment claim had prescribed.
25
Before us, it was argued that the decision of the
Constitutional Court in
President of the Republic of South Africa
v Tembani
(CCT 162/22)
[2024] ZACC 5
(6 May 2024) changed this
position. In
Tembani
, the question was whether a delictual
debt fell due when a presidential power was wrongfully exercised, or
when the exercise of
the power was declared to have been wrongful. On
the basis of the doctrine of objective constitutional invalidity, the
exercise
of the power was held to have been wrongful from the moment
it was exercised, not from the moment it was declared to have been
wrongful (see paragraph 92).
26
Ms. Nyathi, who appeared for the first respondent, and Mr. De
Beer, who appeared for the seventh respondent, both argued that it
follows from
Tembani
that an unlawful administrative act is
invalid from the outset, not from the date on which it is set aside.
27
I do not think that is correct.
Tembani
was decided in
the context of a member of the public suing the state in delict. The
wrongful exercise of a presidential power (which,
as far as I can
see, was not alleged to have been an administrative act) formed part
of the element of wrongfulness in the plaintiff’s
delictual
claim. Understood in that context,
Tembani
makes perfect
sense. But
in this case, the SABC does not sue in
delict. It seeks to review and set aside one of its own
administrative acts. There is
nothing in
Tembani
that
speaks to, or purports to interfere with, either the rule that
administrative acts stand as facts until they are set aside
(see, for
example,
Oudekraal
), or with the rule that an organ of state
cannot simply disavow an administrative act to which it no longer
wishes to give effect
(for which see
Kirland
, amongst other
decisions). The decision in
Tembani
did not cite or deal with
the decisions in
Kirland
or
Njongi
. It cannot, in my
view, sensibly be read as limiting the impact of either of
those decisions, or of the long lines of authority
on which they are
based.
28
It follows that the Special Tribunal’s declaration, at
paragraph 5.3 of its order, that the repayment claim had prescribed,
cannot stand, and that the appeal must succeed to at least this
extent.
Should
the repayment claim succeed?
29
I now turn to the further issue of whether ordering the
respondents to repay the R2.425 million disbursed under the scheme
would
be just and equitable, under section 172 of the Constitution,
as the SABC and the SIU contend.
30
It is not suggested that any of the respondents personally
benefitted from the Mzansi Music Legends scheme. Nor is it suggested
that the scheme was adopted in bad faith or for some ulterior
purpose. The Special Tribunal described the objectives of the scheme
as “laudable and noble” (see paragraph 140 of the Special
Tribunal’s decision), the fact of its unlawfulness
notwithstanding.
31
Many of the respondents dispute the extent of their
involvement in the conception the scheme. Some say that they had
little to do
with it, and that they were not present at the meeting
at which it was finally adopted. The Special Tribunal specifically
refrained
from setting aside the payments that had already been made
under the scheme at the time it declared the scheme unlawful.
32
In these circumstances, I do not think that the repayment
relief can be just and equitable. To order repayment in this case
would
be to create the possibility that state officials who expend
money on the state’s behalf in good faith, with laudable aims
and with no discernible motive for personal gain may be held
personally liable for that money if their conduct is later found to
have been unlawful. It is well-established that state officials are
generally immune from damages claims arising from negligent
acts
performed in their official capacities in good faith (see
Steenkamp
NO v Provincial Tender Board, Eastern Cape
2007 (3) SA 121
(CC),
paragraph 55 and
Telematrix (Pty) Ltd v Advertising Standards
Authority SA
2006 (1) SA 461
(SCA), paragraph 26). I see nothing
in this case that would justify a departure from that general rule.
33
Mr. Motepe, who appeared together with Ms. Cirone for the
appellants, accepted all of this, but asked us, if we conclude that
the
repayment claim has not prescribed, to remit the question of just
and equitable relief to the Special Tribunal for determination
afresh.
34
However, I do not think that remittal would be appropriate.
The facts before us are sufficient to ground the conclusion that
repayment
would not be just and equitable relief in this case. Those
facts are unlikely to be challenged or to change on remittal. In any
event, if the appellants are still entitled, on some other basis, to
pursue some or all the respondents for the losses occasioned
by the
Mzansi Music Legends scheme, the determination that their repayment
claim only fell due on 18 October 2022, when the Special
Tribunal
declared the scheme unlawful, leaves the appellants with sufficient
opportunity to explore any alternative remedies they
may have.
Costs
35
The appellants initially challenged the Special Tribunal’s
decision to direct them to pay the seventh respondent’s costs
on the attorney and client scale. This was on the basis that the
seventh respondent took no issue with the merits of the review,
but
only with the repayment relief, which she successfully resisted.
During argument, Mr. Motepe accepted that there was no basis
on which
we could interfere with the exercise of the Special Tribunal’s
discretion in this respect unless we upheld the appeal
against the
refusal of the repayment relief. Since I would not uphold that aspect
of the appeal, it seems to me that the Special
Tribunal’s costs
order in favour of the seventh respondent should remain undisturbed.
36
On appeal, the SABC and the SIU abandoned their case against
the eighth and ninth respondents at the outset of the hearing before
us. The first and seventh respondents opposed the appeal, and
vigorously defended the Special Tribunal’s conclusion that
the
repayment claim had prescribed. On the approach I take to this
appeal, they have been unsuccessful on that point, but have
nonetheless succeeded in fending off the repayment relief. In these
circumstances, I think that each party should pay their own
costs on
appeal.
Order
37
For all these reasons, we make the following order –
37.1 The appeal is
allowed only to the extent that paragraph 5.3 of the order of the
Special Tribunal is set aside.
37.2 The appeal is
otherwise dismissed, with each party paying their own costs.
S
D J WILSON
Judge
of the High Court
MALINDI J:
Introduction
38
This is an appeal against paragraphs 5.3, 6
and 7 of the Special Tribunal (“the Tribunal”) Judgment
and Order per Modiba
J On 18 October 2022 under Special Tribunal case
number: GP01/ 2021.
39
Paragraph 5.3 of the order reads as
follows:
“
the
debt in respect of which the applicants seek an order that the
respondents pay an amount of R2 425 000.00 (two million
four hundred and twenty-five thousand rand) to the SABC has become
prescribed
.”
40
Paragraphs 6 and 7 relate to the costs
orders to the effect that the parties shall pay their own costs and
that the Appellants shall
pay the 7th Respondent’s costs on an
attorney and client scale.
41
The Appellants sought that the Respondents
pay the amount of R2.425 million in their personal capacities jointly
and severally,
the one paying the other to be absolved.
42
This amount arises out of the impugned
decisions taken by the respondents on 24 July 2016 and 5 September
2016 to reward musicians
identified as music legends with an amount
of R50 000.00 each. These decisions were declared to be
irregular and unlawful
and were set aside by the Tribunal.
43
The appeal is opposed by the first and
seventh Respondents.
Background
44
The
background facts are largely common cause and are set out in the
judgment
[1]
as
follows:
“
[15]
The idea that led to the impugned being made was conceived by
Motsoeneng. EXCO made the July decision. OPCOM ratify this decision
on five September 2016 and implemented it. The decision is recorded
in a written solution OPCOM passed on 29 September 2016. It
was
signed by the SABC’s former Deputy Company Secretary Lindiwe
Bayi. The OPCOM resolution approved the impugned payments
and
required that the list of music legends be reviewed to ensure
completeness and confirmation of beneficiary details to avoid
duplicate payments. It also states that music legends who have been
omitted from the list would be managed on a case by case basis
if
they subsequently approach the SABC.
[16] On 30 September
2016, a business case for the impugned payments was compiled by
Motsoeneng as the then Chief Operating Officer,
supported by Raphela
as the then Chief Financial Officer and approved by Aguma as the then
Group Chief Executive Officer. The business
case sets out a
motivation for the impugned payments. The impugned payments would
incentive the music legends for supporting the
SABC by compensating
music legends who did not receive needle royalties prior to 1996.
They would be paid a once off amount of
R50,000 each.
[17] Ultimately, only
53 music legends were paid in the sum total the applicants seek to
recover in these proceedings.
[18] By December 2016,
members of the Board of the SABC who are in office when the impugned
decisions were made had signed. In March
2017, an interim Board was
appointed. It immediately became seized with several investigations
into maladministration at the SABC.
It also investigated the impugned
decisions.
[19]
On 1 September 2027, the President referred to the SIU for
investigation allegations of impropriety into the affairs of the
SABC
under proclamation No R29 of 2017 published in Government Gazette No.
41086 (the Proclamation). The proclamation was amended
by
Proclamation R.18 of 2018.
[2]
The
impugned decisions form part of several areas of investigation as
authorised by these proclamations.
[20] The SIU finalized
its report in July 2020. It instituted this application in January
2021.”
[3]
45
Crucial
dates that must be noted are the following
[4]
:
45.1
The payments to the music legends were made
between October 2016 and February 2017;
45.2
A new interim Board was appointed in March 2017.
It ordered a forensic investigation in August 2017;
45.3
The report was received by the SABC on 3 August
2017;
45.4
The report states that the decision to make the
payments was irregular and breached the PFMA and the OPCOM had to be
held accountable;
45.5
After the SIU was authorised to investigate the
SABC affairs on one September 2017, the SABC Group Exco discussed the
forensic report
on 14 September 2017. The SABC Exco resolved that no
further payments be made to the music legends;
45.6
The SIU was only authorised to investigate the
impending decisions on 1 September 2017 when Proclamation R.29 was
issued;
45.7
The second phase of the investigation was in May
2018;
45.8
The last interview or information was received on
10 April 2020;
45.9
The SIU report was finalised on 7 July 2020;
45.10
The review application was launched on 21 January
2021;
The Parties’
Contentions
46
The Appellants’ case is a crisp one.
It is whether, as was found by the Special Tribunal, the Appellants’
claim had
prescribed by the time the review application was launched
and a repayment of the R2 425 000.00 was claimed.
47
The Appellants contend that the debt arose
on 18 October 2022 as due and payable when the unlawful and or
irregular decisions were
set aside on review.
48
The Respondents contend that the debt arose
and became due and payable during the first months of the tenure of
the SABC's Interim
Board which was appointed in March 2017 and had
instituted a forensic investigation by August 2017 and received a
report in the
same month. They rely on the fact that the SABC Group
Executive Committee (Exco) having discussed the forensic reports on
14 September
2017 and resolved that no further payments be made under
the music legend scheme as the payments breached the PFMA and
therefore
irregular.
49
The issues for determination are therefore:
49.1
When the debt arose;
49.2
Whether if the debt has prescribed against the
SABC, it has similarly prescribed against the SIU; and
49.3
Whether the debt arose on the date of the
successful review judgment date (on 18 October 2022) in respect of
the SIU.
The Special Tribunal
Judgment
50
The
Tribunal dealt with all three of these issues at paragraphs [64] –
[70]
[5]
and
the SIU's
locus
standi
.
It held that the debt arose on 14 September 2017 when the SABC Exco
adopted the forensic investigation report that it had commissioned
and took a decision to stop any further payments under the Music
Legends Project. The Tribunal held further that the SIU, as a
representative applicant, cannot contend that the claim as in its
separate capacity, arose when it concluded its own investigations
in
terms of the Presidential Proclamation and finalized it on 7 July
2020. In the result, the Tribunal held that the SIU is entitled
to
the relief to which the SABC is entitled. In this regard, the SABC’s
claim that has prescribed has also prescribed against
the SIU.
51
What
requires examination is whether the Tribunal was correct in its
findings at paragraph 65, and as supported by
Mtokonya
v Minister of Police
[6]
to the
effect that
section 12(3)
of the
Prescription Act requires
the
creditor to have knowledge of the facts from which the debt arose. It
does not require the creditor to have any knowledge of
any right to
sue the debtor nor does it require him or her to have knowledge of
legal conclusions that might be drawn from the
facts from which the
debt arose.
Discussion
52
As
stated above, the appellants contend that the Tribunal erred in
determining the date on which the debt arose and prescription
started
running. Reliance is placed on
Njongi
v MEC, Department of Welfare, Eastern Cape
[7]
for
the principle that until such time as the decisions were reviewed and
set aside the appellants were not aware of the existence
of the
obligation or the extent of the obligation owed by the respondents to
them. They relied further on the authority of
WK
Construction (Pty) Ltd v Moores Rowland and Others
[8]
that
the creditor must have established “the full extent of his
rights” before prescription can run.
53
The
Appellants then highlighted the excerpt in
Truter
and Another v Deysel
[9]
being
the
dictum
of Van
Heerden JA that:
“
A
debt is due in this sense when the creditor acquires a complete cause
of action for the recovery of the debt, that is when the
entire set
of facts which the creditor must prove in order to succeed with his
or her claim against the debtor is in place or,
in other words, when
everything has happened which would entitle the creditor to institute
action and to pursue his or her claim.”
54
Van
Heerden JA concluded by citing, with approval, the dictum in
Mckenzie
v Farmers’ Co-Operative Meat Industries Ltd
[10]
that a
“cause of action” for the purposes of prescription means:
“
every
fact which it would be necessary for the plaintiff to prove, if
traversed, in order to support his right to the judgment of
the
Court. It does not comprise every piece of evidence which is
necessary to prove each fact, but every fact which is necessary
to be
proved…”
55
The
Appellants do not state what facts were not available to them on 14
September 2017 when the SABC Group Exco met to consider
the forensic
report. All the necessary facts and legal basis to institute
proceedings were available to them at this stage. The
only impediment
they submit, was that the administrative decision of the Operations
Committee (OPCOM) remained valid or stood until
such time as it was
properly set aside by a Court of law as was held in
Kirland.
[11]
56
Section 14
and
15
of the
Prescription Act
68 of 1969
provides for the two methods by which the running of
prescription shall be interrupted. As regards
section 15
the courts
have held that it is the issuing of a summons that interrupts
prescription. The issuing of a review application in this
case sought
also an order for the repayment of the R2 245 000.00 by the
Respondents in their personal capacity. Whether
this is analogous to
issuing a summons was not an issue in the tribunal and need not be
pursued.
57
Recently in 2020 the Supreme Court of
Appeal, following upon a string of decisions on the application of
the
Prescription Act, also
reiterated the requirements of section
12(3) of the Act by stating the following:
“
[6]
Prescription begins to run when the debt in question is due, that is,
when it is owing and payable.
Section 12(3)
of the
Prescription Act
68 of 1969
provides:
‘
A
debt shall not be deemed to be due until the creditor has knowledge
of the identity of the debtor and of the facts from which
the debt
arises: Provided that a creditor shall be deemed to have such
knowledge if he could have acquired it by exercising reasonable
care.
’
[7]
In the present matter only the requirement of knowledge of ‘the
facts from which the debt arises’ needs to
be considered. These
are the minimum essential facts that the plaintiff must prove to
succeed with the claim. … Legal conclusions,
such as the
invalidity of a contract or that the delictual elements of negligence
or wrongfulness have been established, are not
facts. Neither is the
evidence necessary to prove the essential facts.”
[12]
58
MC
refers
to
Truter
,
Gore
[13]
,
and
Mtokonya
.
59
Therefore, insofar as
section 12(3)
of the
Prescription Act is
concerned, in addition to having the knowledge of
the identity of the debtor, the interpretation that follows is that
the facts
or the factual issue is what is necessary or required for
purposes of
section 12(3).
0in; line-height: 150%">
60
The Act does not define the words
“knowledge of the … facts from which the debt arises”
or give any detail to
these words.
61
This
is a similar dilemma the applicants in
Mtokonya
v Minister of Police
[14]
faced.
The applicants criticised the fact that section 12(3) of the Act
refers only to knowledge of “the facts from which
the debt
arises” and does not also refer to knowledge of legal
conclusions that must be drawn from those facts. The
applicants
said this creates a lacuna. They requested the Constitutional Court
to decide whether this section requires a creditor
to also know that
the conduct of the debtor is wrongful and actionable before a debt
may be deemed to be due or before prescription
may begin to run.
62
In paragraph [37] of the Judgment the court
answered this question by stating that:
“
The
question that arises is whether knowledge that the conduct of the
debtor is wrongful and actionable is knowledge of a fact.
This
is important because the knowledge that section 12(3) requires a
creditor to have is “knowledge of facts from which
the debt
arises”. It refers to the “facts from which the
debt arises”. It does not require knowledge
of legal
opinions or legal conclusions or the availability in law of a
remedy
.”
63
The court went further to state that:
“
A
conclusion of law results when legal effects are assigned to events.
A conclusion of law stands for more than the happening
of events, it
is a step in the legal disposal of events.
If
a rule of law must be applied before a conclusion is reached, that
conclusion is one of law
.”
(Emphasis added)
64
And
also said, “the distinction between [questions of fact and
questions of law] is vitally practical. A question of
fact
usually calls for proof. A question of law usually calls for
argument.”
[15]
65
In
Truter
it was stated that:
“
As
indicated above, the presence or absence of negligence is not a fact,
it is a conclusion of law to be drawn by the court in all
the
circumstances of the specific case. Section 12(3) of the Act requires
knowledge of the relevant legal conclusions (i.e. that
the known
facts constitute negligence) or of the existence of an expert opinion
which supports such conclusions.”
[16]
66
I hasten to venture that a declaration of
invalidity of administrative action is indeed a legal conclusion
drawn by the court in
all the circumstances of a specific case. It is
a rule of law applied to the facts or events. In this case the
Tribunal concluded
that in all the circumstances OPCOM did not have
the authority to make the decisions that it did. The Tribunal could
have held
otherwise on the facts.
67
Ultimately,
whether a person or party knows of the existence of a debt is a
question of fact not law.
[17]
68
In this case the question arises whether a
declaration of invalidity of administrative action is a question of
fact or law. Before
MC (supra)
the cases below had stated that nothing not stated
in the Act disrupts prescription where all the facts giving rise to
the debt
are known to the creditor.
69
In
Minister
of Finance and Others v Gore NO
[18]
the
Supreme Court of Appeal said:
“
This
Court has, in a series of decisions, emphasised that time begins to
run against the creditor when it has the minimum facts
that are
necessary to institute action. The running of prescription is not
postponed until a creditor becomes aware of the full
extent of its
legal rights, nor until the creditor has evidence that would enable
it to prove a case 'comfortably’”
[19]
70
In
Claasen
v Bester
[20]
the
Court also said knowledge of legal conclusions is not required before
prescription begins to run.
[21]
71
In
Yellow
Star Properties 1020 (Pty) Ltd v Department of Development Planning
and Local Government (Gauteng)
[22]
the
court likewise said the failure by an applicant to appreciate the
legal consequences which flowed from the facts does not delay
the
date prescription commences to run.
[23]
72
In
Fluxmans
Incorporated v Levenson
[24]
the
court echoed what is mentioned above by confirming that
Section 12(3)
of the
Prescription Act only
requires knowledge of the material facts
from which the prescriptive period begins to run and that it does not
require knowledge
of the legal conclusion.
[25]
73
In
Steenkamp
v the Provincial Tender Board, Eastern Cape
[26]
the
Constitutional Court wrestled with the
question
whether financial loss caused by improper performance of a statutory
or administrative function should attract liability
for damages in
delict. The Court referred to Section 8 of the Promotion of
Administrative Justice Act
[27]
(“PAJA”)
as providing examples of public remedies suited to vindicate breaches
of administrative justice which are “just
and equitable”.
These remedies are in the main of a public law and not private law
character.
[28]
Section
8 of PAJA provides as follows:
“
(1) The
court or tribunal, in proceedings for judicial review in terms
of section 6 (1), may grant any order that
is just and
equitable, including orders—
(a) directing the
administrator—
(i) to give reasons;
or
(ii) to act in the
manner the court or tribunal requires;
(b) prohibiting
the administrator from acting in a particular manner;
(c) setting
aside the administrative action and—
(i) remitting the
matter for reconsideration by the administrator, with or without
directions; or
(ii) in exceptional
cases—
(aa) substituting or
varying the administrative action or correcting a defect resulting
from the administrative action; or
(bb) directing the
administrator or any other party to the proceedings to pay
compensation;
(d) declaring
the rights of the parties in respect of any matter to which the
administrative action relates;
(e) granting a
temporary interdict or other temporary relief; or
(f) as to costs.
(2) The
court or tribunal, in proceedings for judicial review in terms
of section 6 (3), may grant any order
that is just and
equitable, including orders—
(a) directing
the taking of the decision;
(b) declaring
the rights of the parties in relation to the taking of the decision;
(c) directing
any of the parties to do, or to refrain from doing, any act or thing
the doing, or the refraining from the doing,
of which the court or
tribunal considers necessary to do justice between the parties; or
(d) as to
costs.”
74
The appellants obtained their remedy under
paragraph (1)(c
)
and, in my view, ought to
pursue the common law remedy separately and in compliance with such
law. A damages claim such as in this
case is subject to laws which
have not been dispensed with by the Constitution.
Tembani
[29]
vs
Kirland
[30]
75
In the case of
Tembani
there
were 25 plaintiffs who owned farms or conducted farming operations in
Zimbabwe. In 2005, Zimbabwe amended its Constitution
to allow
agricultural land to be confiscated or expropriated without
compensation and ousted the jurisdiction of its courts to
entertain
challenges to such confiscations. Some of the plaintiffs successfully
pursued claims against Zimbabwe in the South African
Development
Community (“SADC”) Tribunal. However, Zimbabwe defied the
Tribunal's decisions. In 2011, the SADC Summit
decided to suspend the
operations of the SADC Tribunal with the support of South Africa's
then President Zuma. In 2014, the Summit
adopted a new Protocol
abolishing individual access to the Tribunal, which President Zuma
signed. In 2018, the High Court declared
President Zuma's
participation in suspending the Tribunal and signing the 2014
Protocol as unconstitutional, and this was confirmed
by the
Constitutional Court. The President was ordered to withdraw his
signature from the 2014 Protocol.
76
Appellants submitted that:
“…
because
a finding of constitutional validity has to be made or confirmed by
this Court, the plaintiffs’ causes of action were
not completed
until such an order was made by this Court. In other words, …
until this Court made its order the President’s
conduct had to
be treated by a trial court as constitutional.”
77
Rogers J, writing on behalf of the
unanimous Court held that the argument:
“
Confuses
what has to be decided with who has to decide it and when it has to
be decided. If the President acted unconstitutionally
in May 2011 and
August 2014 in the manner alleged by the Plaintiffs, his conduct was,
objectively speaking, already unconstitutional
then. If a court of
competent jurisdiction
later
concludes that the President acted unconstitutionally, its conclusion
is that he acted unconstitutionally when he performed
the act in
question. The acts do not become unconstitutional only from the time
the court makes such a conclusion. This is in accordance
with the
doctrine of objective constitutional invalidity. Having regard to the
plaintiffs’ pleaded case, a component of the
wrongfulness
alleged by them was that the president violated the constitution by
his conduct in 2011 and 2014. If the President
indeed acted contrary
to the Constitution at those times, the components of pleaded
wrongfulness came into existence in 2011 and
2014. What the
plaintiffs are to allege and prove was that the President acted
unconstitutionally at those times. They did not
need to allege and
prove that another court had already found that the President so
acted.”
[31]
78
It was argued by the Plaintiffs before the Constitutional
Court that
President Zuma’s conduct remained
of full force and effect until the declaration of unconstitutionality
was confirmed by the
Constitutional Court. On this note they added
that until the Constitutional Court had confirmed the declaration of
invalidity,
the High Court would have had to treat President Zuma’s
conduct as constitutionally valid and could thus not have determined
the question of wrongfulness. The plaintiffs also made a proposition
that an application for review relief can interrupt prescription
in
respect of a delictual claim arising from the conduct found in the
review to have been unlawful.
79
Amongst the legal questions the Constitutional Court had to
entertain was the question of
prescription; when
did the debts become due and whether the plaintiffs' claims had
prescribed; and the issue of confirmatory and
exclusive jurisdiction
in these kinds of cases.
80
The
plaintiffs argued that the Constitutional Court's judgment in
Law
Society
[32]
completed
their causes of action, as President Zuma's conduct remained in force
until declared unconstitutional by this Court. They
stated: "Until
this Court confirmed the declaration of invalidity, the High Court
would have had to treat President Zuma's
conduct as constitutionally
valid and could thus not have determined the question of
wrongfulness."
[33]
81
In
dealing with these issues, firstly, the court confirmed the legal
position of
section 12(3)
of the
Prescription Act which
is,
prescription starts to run against a creditor when the creditor has
the minimum facts that are necessary to institute action,
and that
the running of prescription is not postponed until the creditor
becomes aware of the full extent of its legal rights.
[34]
82
Notwithstanding
this legal position, the existence of
procedural
mechanisms exist to enable proceedings to be served so as to
interrupt prescription.
[35]
83
When dealing with
the issue of confirmatory and exclusive jurisdiction the court said
this case fell within its confirmatory and
not exclusive
jurisdiction.
The
Court reasoned that its confirmatory jurisdiction under sections 167
and 172 of the Constitution meant the plaintiffs' delictual
claims
against the President could not be completed until the Court
confirmed the unconstitutionality of the president’s
conduct
related to the SADC Tribunal, which was a necessary element of
wrongfulness they had to establish. This impacted when prescription
started running. The court found that the action fell “due”
by not later than 18 August 2014.
[36]
84
As
in
Tembani,
the
Appellants contended that they could not pursue a delictual claim
until the OPCOM's conduct had been declared invalid and
unconstitutional
and set aside. This was a legal impediment to pursue
a delictual claim despite knowledge of the debtor and the facts
giving rise
to that debt. However,
Tembani
held
that to plead the case the claimants did not have to plead that
another court had already found the OPCOM conduct to be unlawful.
[37]
85
As
stated in
Tembani
,
it is not for the Court to speculate what the Respondents would have
pleaded in their defence. That bridge should be crossed when
it is
reached. Rogers J referred to section 15(6) of the Act as providing
procedural mechanisms to enable proceedings to be served
so as to
interrupt prescription. He comments that the issuing of summons would
not have been premature pending the unconstitutionality
declaration
in that matter as much as it would not have been premature to issue
summons in the SABC matter pending the invalidity
of the
administrative action of the OPCOM.
[38]
86
Rogers
J makes a distinction between a public law claim in review
proceedings and a private law claim for delictual damages. A claim
for delictual damages stands alone against a public law claim in
review proceedings.
[39]
the
sequence of this two-step process would depend on the circumstances
of each case - whether to institute review proceedings first
(provided that in the estimation of the claimant such proceedings
would be concluded before the period of prescription lapses),
or to
institute the delictual claim first in order to interrupt
prescription and have those proceedings held in abeyance pending
the
outcome of review proceedings.
87
The
Appellants obtained a right to hold the respondents accountable as
the first leg of the process by the declaration of unlawfulness
of
the respondents’ conduct. However, recovering a debt arising
out of the impugned decisions was a second step requiring
a claim
under delict and which claim is subject to the laws of
prescription.
[40]
In
this case the delictual claim was made together with the review
application and the claim had prescribed.
88
In this court the appellants sought to
distinguish
Tembani
on
the basis that there it was a claim for delictual damages as opposed
to the public law remedies involved in the current appeal,
Kirland
,
Njongi
and
others. This distinction is artificial. The SABC is claiming
delictual damages against the respondents. It seeks to recover
an
amount paid unlawfully as a result of their decisions. The public law
remedy stands alone as a declaration of invalidity and
the recovery
of the money also stands alone as a claim that may have been pursued
separately but for the SIU proclamations that
mandate the SIU to
recover losses.
89
The Constitutional Court distinguished
between public law claims and private law claims for delictual
damages. The court said the
following:
“
The
differences between a public law claim in review proceedings and a
private law claim for delictual damages are substantially
greater
than in the above examples. A violation of the Constitution is of the
essence where an applicant claims constitutional
relief for an
alleged violation of the Constitution by the President. In a
delictual claim against the President, the plaintiff
must establish
that the President acted wrongfully in the delictual sense. A breach
of the Constitution may or may not be an element
of establishing
wrongfulness; it is not an element of the cause of action as such.
Fault, causation and damage are not elements
of a public law cause of
action.”
[41]
(Emphasis
added).
90
In
Kirland
the Constitutional Court had to deal with a
matter under the following facts:
90.1
In July 2006 and May 2007, Kirland Investments
applied for approvals to establish a 120-bed hospital in Port
Elizabeth, two unattached
operating theatres and a 20-bed hospital in
Jeffreys Bay.
90.2
An Advisory Committee considered Kirland's
applications and recommended that they be refused. The
Superintendent-General accepted
the recommendations and declined to
approve them. These decisions were reduced to writing but before the
Superintendent-General
could sign them, he was involved in a motor
vehicle accident and took sick leave for six weeks.
90.3
During the Superintendent-General's absence, an
Acting Superintendent-General was appointed. Meanwhile, the MEC
informed officials
that she would meet with the Provincial
Chairperson of the ruling political party to discuss Kirland's
applications.
90.4
The Superintendent-General had declined the
applications on 9 October 2007 and two days later he had the
accident. On 23 October
2007, the MEC summoned the Acting
Superintendent-General to her office and reviewed the file containing
the Superintendent-General's
decision to refuse approval. She
instructed the Acting Superintendent-General to approve Kirland's
applications. She also did so
due to political pressure. The Acting
Superintendent-General was aware of the Superintendent-General's
refusal decision based on
the Advisory Committee's recommendation,
but the MEC said she had authority as political head to make the
final decision.
90.5
The Acting Superintendent-General stated that in
accordance with the verbal instruction from [the MEC], he drafted a
letter to [Kirland]
informing it that its applications had been
approved.
90.6
Kirland subsequently applied to increase the
capacity of the proposed hospitals based on the purported approvals.
90.7
After resuming duties, the Superintendent-General
again declined to approve Kirland's applications. By letter dated 20
June 2008,
the Superintendent-General informed Kirland that the
approval by the Acting Superintendent-General was withdrawn, as the
area was
oversupplied with private health facilities.
91
The Court had to determine, amongst others,
whether the approval by the Acting Superintendent-General was an
effective decision
until set aside.
92
Cameron
J said, in view of the judgment of Constitutional Court in
Oudekraal
[42]
,
an
invalid administrative action may not simply be ignored, but may be
valid and effectual, and may continue to have legal consequences,
until set aside.
[43]
The
court said this position comes from the principle of the rule of
law.
[44]
93
The court also said:
“
For
a public official to ignore irregular administrative action on the
basis that it is a nullity amounts to self-help. And it invites
a
vortex of uncertainty, unpredictability and irrationality. The
clarity and certainty of governmental conduct, on which we all
rely
in organising our lives, would be imperilled if irregular or invalid
administrative acts could be ignored because officials
consider them
invalid.”
[45]
94
In
Magnificent
Mile Trading 30 (Pty) Limited v Charmaine Celliers NO (Magnificent
Mile Trading 30 (Pty) Limited)
[46]
Madlanga
J
said,
in relation to the Oudekraal principle, “
it
is one thing to say – but for an unlawful administrative act –
something would never have come about and that, once
it has come
about, it continues to exist for as long as the unlawful
administrative act to which it owes its existence has not
been set
aside.”
[47]
95
The court went further to say:
“
Crucially
though, the Oudekraal rule itself is informed by the rule of law.
Imagine the spectre of organs of state and private persons
ignoring
or giving heed to administrative action based on their view of its
validity. The administrative and legal chaos that would
ensue from
that state of affairs is unthinkable. Indeed, chaos and not law would
rule.”
[48]
As
such, the Oudekraal rule averts the chaos by saying an unlawful
administrative act exists in fact and may give rise to legal
consequences for as long as it has not been set aside.”
[49]
96
This position
does
not seek to confer legal validity to the unlawful administrative act,
but rather, seeks to prevent self-help for an orderly
governance and
administration.
[50]
97
Jafta J concurring with this position, said
the following:
“
we
must acknowledge the principle that, just like laws, administrative
actions are presumed to be valid until declared otherwise
by a court
of law. What this means is that any person who disregards such law or
action does so at his or her own peril should
it turn out that the
law or action is valid
.”
[51]
98
This position,
however,
does
not mean that the administrative act is valid. It is only treated as
such. The only time it can be ignored without being set
aside is in
cases where a person is coerced by a public authority into
complying
with
an unlawful administrative act.
[52]
99
It
appears that there is a concurrence on this position. Case law seems
to be suggesting that as a general principle administrative
action is
valid until set aside.
[53]
This
position accords with the position under private law too that an
obligation under private law, such as a contract between parties,
is
enforceable until it has lawfully been set aside.
[54]
100
Coming back to
Kirland
and
Tembani
.
Kirland
says
an administrative action is valid until set aside.
Tembani
says the issuing of the summons would not be
premature. However, in exclusive jurisdiction matters the requirement
would be either
that the relevant party simultaneously issues summons
in the High Court and in the Constitutional Court. The summons
would
refer to the parallel application before the Constitutional
Court and seek a stay of the summons pending the Constitutional
Court’s
decision. Alternatively, the creditor could start
by just issuing an application in the Constitutional Court, as a
first
step in proceedings for the recovery of delictual damages.
101
The
Court, however, said this does not matter for purposes of
prescription.
[55]
102
Tembani
did
not refer to
Njongi
and
the cases considered by it. In
Njongi
,
the court grappled with whether the right to receive a social
disability grant within the context of the entrenched socio-economic
rights can be subject to extinctive prescription where such grant had
been cancelled by a provincial government. The claim was
for arrear
payments from the date that the cancellation was declared invalid.
103
In
Bushula
[56]
a full
reinstatement of the grant was ordered with the effect therefore that
grants not paid from the date of cancellation had to
be paid to date
of the declaration of invalidity of administrative action. In this
regard, Yacoob J in Njongi said:
“
[45] I
agree. But the doctrine of nullity does have important
practical implications whenever it becomes necessary to
determine the
consequences of invalidity. The order in Bushula evidently
required the applicant to be put back
into the position in which he
would have been had the administrative decision not been made at
all. This is in essence the
practical application of the
principle of objective invalidity or nullity. After a judgment
setting this administrative decision
aside has been given, the
administrative decision is certainly regarded as having been void
ab initio.
[46] But that is
a wholly different question from the one that must be answered in
this case. Here we are concerned with
administrative action
that remains effective. Far from having been a nullity while in
operation, the administrative decision
with which we are here
concerned as well as the thousands of others that were taken at about
the same time have caused untold misery
and suffering. This
case cannot therefore be decided on the basis that the administrative
action concerned was a nullity
from the beginning. As I have
already pointed out, the consequences of the administrative decision
must be determined, so
far as is possible, in order to achieve the
situation that would have existed had the administrative decision
been a nullity.”
[57]
104
In
Ngxuza
[58]
the
SCA castigated the provincial government for not following the
decision in
Bushula
,
i.e
.
reinstating fully the grants in circumstances where the cancellations
were unlawful.
105
Mrs
Njongi’s grant had been partially reinstated, and the
Constitutional Court had to deal with whether there should have
been
a full reinstatement as in
Bushula
and
Ngxuza
.
The Court assumed in favour of the Provincial Government that the
obligation at issue is a debt for purposes of the Act.
[59]
The
only question was whether “
the
obligation to pay the arrears had always remained immediately
enforceable,… whether it could be said to have been due
.”
[60]
106
In
Matinese
[61]
the
High Court held that a review was necessary as a precondition to the
enforcement of the debt arising out of the termination
of her grant.
Njongi
endorses
this principle and concludes that because full reinstatement had not
been effected, prescription had not yet begun to run.
[62]
107
Although
Tembani
does not refer to
Njongi
there is no doubt that Rogers J was alive to the
distinction between private law and public law remedies in
litigation. It is more
authoritative in regard to the principle
repeated multiple times in both the Supreme Court of Appeal and the
Constitutional Court
that the knowledge of the facts contemplated in
the Act does not include conclusions of law. This applies in both
public and private
law litigation. In my view, that conduct or
administrative action has not been set aside and therefore remains
effective does not
mean that the creditor has not gained knowledge of
the debtor and the facts giving rise to the debt. It merely means
that a legal
impediment stands in the way of prosecuting a claim
until it has been overcome.
108
The
Oudekraal
principle
is
not an answer to the appellants’ failure to interrupt
prescription. They could have issued summons and had the trial held
in abeyance pending the outcome of the review, if so advised.
109
The
SABC disavowed any reliance on the impugned decisions on 14 September
2017 and should have taken steps to hold the OPCOM accountable
and
recover money from the respondents as advised. Yacoob J said that
“
where
the organ of state ‘disavows reliance’ on the decision
concerned, prescription begins to run from that date.
”
[63]
That
signifies that the SABC appreciated that it can claim against the
Respondents but for the
Oude
Kraal/Kirland
obstacle
which required to be removed before its claim is hit by prescription
or to proceed with review parallel to a delictual
claim according to
Tembani
.
110
If the Respondents had acted unlawfully and
in breach of the PFMA in February 2017 they did not need a review
decision to establish
knowledge of the debtor and facts giving rise
to such debt.
111
The
conclusion is that the SABC claim has prescribed. It has also
prescribed against the SIU for the insurmountable reasons
stated by
Modiba J in the Tribunal. The interpretation of section 2(1)(c)
and 5(5) of the SIU and Tribunal Act
[64]
is
clear in its reading. The SIU has the power to initiate proceedings
in its own name where its interests are impacted in the circumstances
stated in Section 2(1)(c), otherwise it acts on behalf of the
relevant organ of state.
Special
Tribunal Unit v Kim Diamonds (Pty) Ltd
[65]
remains
good law on the SIU's representative capacity when acting under any
Proclamation to conduct investigations on behalf of
organs of state
or against them and to initiate proceedings on their behalf.
112
To
hold otherwise would offend against the
Prescription Act and
render
it ineffective. In this regard the Chief Justice, writing for the
majority in
Mtokonya
said:
“
[63]
Furthermore,
to say that the meaning of the phrase “the knowledge of . . .
the facts from which the debt arises” includes
knowledge that
the conduct of the debtor giving rise to the debt is wrongful and
actionable in law would render our law of prescription
so ineffective
that it may as well be abolished. I say this because
prescription would, for all intents and purposes, not
run against
people who have no legal training at all. That includes not
only people who are not formally educated but also
those who are
professionals in non-legal professions. However, it would also
not run against trained lawyers if the field
concerned happens to be
a branch of law with which they are not familiar. The
percentage of people in the South African population
against whom
prescription would not run when they have claims to pursue in the
courts would be unacceptably high. In this
regard, it needs to
be emphasised that the meaning that we are urged to say is included
in
section 12(3)
is not that a creditor must have a suspicion (even a
reasonable suspicion at that) that the conduct of the debtor giving
rise to
the debt is wrongful and actionable but we are urged to say
that a creditor must have knowledge that such conduct is wrongful and
actionable in law. If we were asked to say a creditor needs to
have a reasonable suspicion that the conduct is or may be
wrongful
and actionable in law, that would have required something less than
knowledge that it is so and would not exclude too
significant a
percentage of society.”
[66]
113
Njongi
does
not delineate between public and private law remedies. Private law
claims are subject to prescription whereas public law claims
are not.
114
The real issue between
Kirland
(and the class of judgments that follow the
Oudekraal
principle)
is whether administrative action is invalid from the date that it was
taken, like wrongful conduct in
Tembani
which was held wrongful from date of
such conduct, or whether the administrative action remains effective
until it is set aside
its loss of effect is only from the date of
declaration of invalidity. I see no reason why the latter applies
when in
Njongi
the
reinstatement was with effect from date of the impugned decision, not
from the date of the invalidity which would have left
her with no
“back-pay.”
115
In this case the appellants would therefore
not be entitled to recover any moneys, because the OPCOM decision
would have been valid
until set aside and with no retrospective
effect.
Conclusion
116
For the reasons stated above, the appeal
stands to fail. Furthermore, as was held in the Tribunal it is not
necessary to consider
whether personal liability of the Respondents
would be appropriate in this case is view of the finding on
prescription which disposes
of the matter as a whole.
Costs
117
The appellants are to pay the cost of the
1st and 7th respondents, including the cost of counsel on the B
Scale. The issues were
important to both sides of this matter and
engaged a measure of complexity.
118
I
would have made the following order:
118.1
The appeal is dismissed.
118.2
The Appellants are to pay the cost
of the 1st and 7th respondents, including the cost of counsel on the
B Scale.
G MALINDI
Judge of the High Court
This
judgment is handed down electronically by circulation to the parties
or their legal representatives by email, by uploading
to Caselines,
and by publication of the judgment to the South African Legal
Information Institute. The date for hand-down is deemed
to be 30 July
2024.
HEARD
ON:
22 May 2024
DECIDED
ON:
30 July 2024
For
the Appellants
J
Motepe SC
P
Cirone
Instructed
by Werksmans Attorneys, Johannesburg
For
the First Respondent:
N
Nyathi
Instructed
by Bokwa Law Inc, Pretoria
For
the Seventh Respondent:
M De
Beer
Instructed
by Moeti Kanyane Inc
For
the Eighth and Ninth
M
Kufa
Respondents:
Instructed
by Machaba Attorneys
[1]
Judgment:
Vol 7, 003-706
[2]
Proclamation
R.18 of 2018 published on 6 July 2018 in Government Gazette No.
41754.
[3]
Judgment:
Vol 7, 003-710
[4]
Judgment:
Vol 7, 003-718 to 003-722
[5]
Judgment:
CaseLines
section 003
-
720
.
[6]
2018
(5) SA 22
CC at [32], [36], [44] – [45].
[7]
[2008] ZACC 4
;
2008
(4) SA 237
(CC) at
[40]
to [56].
[8]
2002
(6) SA 180
(SCA) at [33].
[9]
[2006] ZASCA 16
;
2006
(4) SA 168
(SCA) at
[16]
.
[10]
1922
AD 16
at 23.
[11]
MEC
for Health, Eastern Cape and Another v Kirland Investments (Pty) Ltd
t/a Eye & Lazer Institute
2014
(3) SA 481 (CC).
[12]
MEC
for Health, Western Cape v M C
(Case
N0. 1087/20190
[2020] ZASCA 165
at
paragraph
[6]
- [7].
[13]
Minister
of Finance and Others v Gore N.O.
[2006]
ZASCA 98; 2007 (1) SA 111 (SCA)
[14]
Mtokonya
v Minister of Police
[2017]
ZACC 33; 2017 (11) BCLR 1443 (CC); 2018 (5) SA 22 (CC).
[15]
Mtokonya
at [43]
[16]
Truter
and Another v Deysel
[2006]
ZASCA 16
;
2006 (4) SA 168
(SCA) at para 19.
[17]
Mtokonya
at
[71]
[18]
Minister
of Finance and Others v Gore NO
[2006]
ZASCA 98; [2007] 1 All SA 309 (SCA); 2007 (1) SA 111 (SCA).
[19]
Id
at
paragraph 17.
[20]
Claasen
v Bester
[2011]
ZASCA 197; 2012 (2) SA 404 (SCA).
[21]
Id
at
paragraph 15.
[22]
Yellow
Star Properties 1020 (Pty) Ltd v Department of Development Planning
and Local Government (Gauteng)
[2009]
ZASCA 25
;
2009 (3) SA 577
(SCA);
[2009] 3 All SA 475
(SCA).
[23]
Id at paragraph 37.
[24]
Fluxmans
Incorporated v Levenson
[2016]
ZASCA 183; [2017] 1 All SA 313 (SCA); 2017 (2) SA 520 (SCA).
[25]
Id at paragraph 42.
[26]
2007
(3) SA 121 (CC).
[27]
Act 3
of 2000.
[28]
At
[30].
[29]
President
of the Republic of South Africa and Another v Tembani and Others
[
2024]
ZACC 5
(
Tembani
).
[30]
MEC for Health,
Eastern Cape and Another v Kirland Investments (Pty) Ltd [
2014]
ZACC 6
;
2014 (5) BCLR 547
(CC);
2014 (3) SA 481
(CC) (
Kirland
).
[31]
Tembani
at [91].
[32]
Law
Society of South Africa v President of the Republic of South Africa
[2018]
ZACC 51; 2019 (3) SA 30 (CC); 2019 (3) BCLR 329 (CC).
[33]
Tembani
at para 57.
[34]
Id at
paragraph
86.
[35]
Id at
paragraph
96.
[36]
Id at
paragraph
102.
[37]
Paragraph
[92].
[38]
Tembani
at
paragraph [96], [97], and [98].
[39]
At
paragraph [124].
[40]
See
Tembani at [116].
[41]
Id at
paragraph
124.
[42]
Oudekraal
Estates (Pty) Ltd v The City of Cape Town and Others
[2009]
ZASCA 85; 2010 (1) SA 333 (SCA).
[43]
Kirland
at paragraph 101.
[44]
Id at paragraph 103.
[45]
Id.
[46]
Magnificent Mile
Trading 30 (Pty) Limited v Charmaine Celliers NO and Others
[2019] ZACC 36; 2020 (1)
BCLR 41 (CC); 2020 (4) SA 375 (CC).
[47]
Id
at
paragraph 43.
[48]
Id at paragraph 50.
[49]
Id
at
paragraph 51.
[50]
Id at paragraph 51.
[51]
Magnificent Mile
Trading 30 (Pty) Limited v Charmaine Celliers NO and Others
[2019] ZACC 36
;
2020 (1)
BCLR 41
(CC);
2020 (4) SA 375
(CC) at
[83]
.
[52]
Kwa Sani Municipality
v Underberg/Himeville Community Watch Association and Another
[2015] ZASCA 24
;
[2015]
2 All SA 657
(SCA) at para 12. See also
Bowman
Gilfillan Inc and another v Minister of Transport; In re: Minister
of Transport v Mahlalela and others
[2018]
JOL 40032
(GP) at paragraph 61.
[53]
See
Trudon
(Pty) Ltd v The National Prosecuting Authority
2018
JDR 2161 (GP).
[54]
Beadica
231 CC and Others v Trustees for the time being of the Oregon Trust
and Others
[2020]
ZACC 13
;
2020 (5) SA 247
(CC);
2020 (9) BCLR 1098
(CC) at para
82-85. Compare
Premier,
Free State, And Others v Firechem Free State (Pty) LTD
2000
(4) SA 413
(SCA).
[55]
Tembani
at
paragraph 96.
[56]
Bushula
and Others v Permanent Secretary, Department of Welfare, Eastern
Cape, and Another
2000
(2) SA 849 (E).
[57]
Njongi
at
paragraphs 45 and 46.
[58]
Ngxuza
and Others v Permanent Secretary, Department of Welfare, Eastern
Cape, and Another 2001 (2) SA 609 (E); 2000 (12) BCLR
1322 (E).
[59]
Njongi
at
[43].
[60]
Ibid.
[61]
Matinese
v Member of the Executive Council for the Department of Welfare,
Eastern Cape (1603/03) (10 February 2024) at p 13
.
[62]
Njongi
at
paragraph 56 – 59.
[63]
Njongi
at
paragraph 56.
[64]
No
764 of 1996.
[65]
2004
(2) SA 173 (SpT).
[66]
Mtokonya
at
[63].
sino noindex
make_database footer start
Similar Cases
Broadhurst v Gearhouse Splitbeam (Pty) Limited and Another (9915/2020) [2023] ZAGPJHC 782; [2023] 3 All SA 682 (GJ); 2023 (6) SA 232 (GJ) (6 July 2023)
[2023] ZAGPJHC 782High Court of South Africa (Gauteng Division, Johannesburg)100% similar
Broadband Infraco SOC Limited v Eskom Holdings SOC Limited and Another (2023/062380) [2023] ZAGPJHC 1343 (13 November 2023)
[2023] ZAGPJHC 1343High Court of South Africa (Gauteng Division, Johannesburg)100% similar
Broadband Infraco Soc Limited v Eskom Holdings Soc Limited and Another (2023/062380) [2023] ZAGPJHC 1424 (8 December 2023)
[2023] ZAGPJHC 1424High Court of South Africa (Gauteng Division, Johannesburg)100% similar
Broadband Infraco SOC Limited v Eskom Holdings SOC Limited (2023/062380) [2023] ZAGPJHC 880 (7 August 2023)
[2023] ZAGPJHC 880High Court of South Africa (Gauteng Division, Johannesburg)100% similar
South African Agricultural Machinery Association and Another v Motor Industry Ombudsman of South Africa and Others (20/44414) [2024] ZAGPJHC 824 (30 April 2024)
[2024] ZAGPJHC 824High Court of South Africa (Gauteng Division, Johannesburg)99% similar