Bliss Brads (Pty) Limited v Advertising Regulatory Board NPC and others

• Jurisdiction: http://justis.com/jurisdiction/166,South Africa
• Judge: Zondo CJ, Kollapen J, Madlanga J, Majiedt J, Makgoka AJ, Mathopo J, Potterill AJ, Rogers J and Theron J
• Judgment Date: 26 June 2023
• Citation: 2023 JDR 2258 (CC)
• Hearing Date: 02 March 2023
• Docket Number: CCT 132/22
• Court: Constitutional Court

Madlanga J (Zondo CJ, Kollapen J, Majiedt J, Makgoka AJ, Mathopo J, Potterill AJ, Rogers J and Theron J concurring):

Introduction

[1]

Bliss Brands (Pty) Ltd (Bliss Brands), the applicant, is a company that sells cleaning and hygiene products. At issue in this matter are questions of a constitutional and administrative law nature. They have a reach beyond the role players in this matter. Chief amongst the issues is whether a non-profit company, the Advertising Regulatory Board NPC (ARB), the first respondent, which is a non-statutory body, has authority to take regulatory action against an entity that is not its member. This question arises because Bliss Brands is not a member of the ARB. Despite the magnitude of the questions and the allure of grappling with them, the decision we reach highlights the fact that at times the imperative of judicial avoidance does and must carry the day. Indeed, in Albutt Ngcobo CJ tells us that —

2023 JDR 2258 p3

Madlanga J (Zondo CJ, Kollapen J, Majiedt J, Makgoka AJ, Mathopo J, Potterill AJ, Rogers J and Theron J concurring)

“[s]ound judicial policy requires us to decide only that which is demanded by the facts of the case and is necessary for its proper disposal. This is particularly so in constitutional matters, where jurisprudence must be allowed to develop incrementally. At times it may be tempting, as in the present case, to go beyond that which is strictly necessary for a proper disposition of the case. Judicial wisdom requires us to resist the temptation and to wait for an occasion when both the facts and the proper disposition of the case require an issue to be confronted. This is not the occasion to do so. There may well be cases, and they are very rare, when it may be necessary to decide [for example] an ancillary issue in the public interest.” [1]

[2]

What dictates the adoption of a minimalist approach in this matter will soon become apparent.

Background

[3]

The ARB is an independent, voluntary entity that regulates advertising among its members. It is funded by some of its members and by certain entities that are not members. Its core function is to ensure that advertising by its members accords with its Code of Advertising Practice (Code). The Code states its main objects to be: to protect consumers; to ensure that advertisers maintain standards of professionalism; and to ensure that advertising, which is a service to the public, is informative, factual, honest and decent. The Code is based on the International Code of Advertising Practice. Internationally the latter code is the basis of domestic self-regulation in the advertising industry. Industry players in South Africa, some of whom are members of the ARB and some of whom are not, comprise the print, digital and broadcast media.

[4]

The relationship between the ARB and its members is contractual. [2] It is in terms of that contractual relationship that members are bound by the Code. In the main, the

2023 JDR 2258 p4

Madlanga J (Zondo CJ, Kollapen J, Majiedt J, Makgoka AJ, Mathopo J, Potterill AJ, Rogers J and Theron J concurring)

Code prescribes that members must not prepare or accept any advertising that conflicts with it and must withdraw any advertising that is subsequently deemed to be unacceptable by certain functionaries of the ARB.

[5]

Although the ARB’s Memorandum of Incorporation (MOI) says that – absent submission to jurisdiction – the ARB has no jurisdiction over non-members, the ARB may issue rulings that impact negatively on the rights or interests of non-members. This is in instances where – by means of a ruling – the ARB directs its members not to accept an advertisement if it is yet to be published or to withdraw it if it has been published. A ruling of this nature is called an ad-alert. [3] The effect of the direction will be that a member will have to withdraw a non-member’s advertisement that has been published or refuse to accept a non-member’s advertisement that is yet to be published. [4]

[6]

Colgate-Palmolive (Pty) Ltd, the second respondent, and Colgate-Palmolive Company (Colgate), the third respondent, are competitors of Bliss Brands. Colgate lodged a complaint with the ARB against Bliss Brands. It alleged that the packaging of Securex, a soap manufactured by Bliss Brands, breached the Code in that it imitated the packaging architecture of Protex, a soap manufactured by Colgate, thereby improperly exploiting the advertising goodwill of Protex.

[7]

Bliss Brands, a non-member of the ARB, did not object to the ARB’s exercise of jurisdiction over it. Instead, it participated in the ARB proceedings, engaging with

2023 JDR 2258 p5

Madlanga J (Zondo CJ, Kollapen J, Majiedt J, Makgoka AJ, Mathopo J, Potterill AJ, Rogers J and Theron J concurring)

the merits of the complaint. The first letter of response to the complaint written by Bliss Brands’ attorneys which engaged with the complaint in detail [5] is notable for the fact that, despite its length, it contained nary a word about the ARB’s lack of jurisdiction. I cannot but emphasise the fact that the engagement with the merits of the complaint totalled 11 pages and just under 70 paragraphs. This, despite a request by the ARB that Bliss Brands indicate “if [it did] not consider itself to be bound by the [jurisdiction of the] ARB”.

[8]

The Directorate, which is the first-instance level in the ARB’s hierarchy of deciding complaints, found for Bliss Brands. Colgate went on appeal to the Advertising Appeals Committee (AAC) within the hierarchy. It succeeded. Bliss Brands appealed to the ARB’s Final Appeal Committee (FAC). The FAC ruled that Bliss Brands should stop its distribution of the Securex packaging.

[9]

At none of the three levels of the ARB’s decision-making, did Bliss Brands object to the ARB’s exercise of jurisdiction over it.

[10]

After its appeal was dismissed by the FAC, Bliss Brands brought a review application in the Gauteng Division of the High Court, Johannesburg (High Court) in which it attacked the FAC’s decision on review grounds founded on the Promotion of Administrative Justice Act [6] (PAJA) and the principle of legality. Crucially, part of the relief it sought was remittal to the ARB’s FAC in the event of the prayer for a substituted decision being unsuccessful, something consonant with acceptance of the ARB’s jurisdiction.

[11]

It was only after it was prompted by a directive issued by Fisher J in the High Court that Bliss Brands added wide-ranging constitutional issues to the review

2023 JDR 2258 p6

Madlanga J (Zondo CJ, Kollapen J, Majiedt J, Makgoka AJ, Mathopo J, Potterill AJ, Rogers J and Theron J concurring)

application thereby bringing about a significant change to its nature. Pursuant to the directive, Bliss Brands sought an order declaring the ARB’s MOI unconstitutional. Alternatively, it asked the Court to declare that: clause 3.3 of the MOI is unconstitutional; [7] and the ARB has no power to exercise jurisdiction over non-members and their advertising. The High Court made an order along the lines of the alternative relief. As a consequence, it set aside the FAC’s decision.

[12]

On appeal, the Supreme Court of Appeal reversed the High Court’s decision. It first criticised the High Court for raising issues that had not been raised by Bliss Brands. [8] It held that Bliss Brands had submitted to the ARB’s jurisdiction and that – on this basis alone – the appeal had to succeed. At the urging of counsel for the ARB, the Supreme Court of Appeal did not end there. Counsel urged that Court to deal with the issues which had been raised by Bliss Brands at the instance of, and had then been decided by, the High Court (constitutional issues). Counsel submitted that, if left undisturbed, what the High Court held on the constitutional issues would result in legal uncertainty and that this would impede the proper functioning of the ARB. The Supreme Court of Appeal...