Florence v Government of the Republic of South Africa

• Jurisdiction: South Africa
• Judge: Moseneke ACJ, Skweyiya ADCJ, Cameron J, Dambuza AJ, Froneman J, Jafta J, Khampepe J, Madlanga J, Majiedt AJ, Van Der Westhuizen J and Zondo J
• Judgment Date: 26 August 2014
• Citation: 2014 (6) SA 456 (CC)
• Docket Number: CCT 127/13 [2014] ZASCA 22
• Hearing Date: 18 February 2014
• Counsel: P Hathorn (with F Jakoet and S Harvey) for the appellant. B Joseph for the respondent.
• Court: Constitutional Court

Van der Westhuizen J (Cameron J, Froneman J and Majiedt AJ concurring, and Khampepe J concurring only on the cross-appeal):

Introduction I

[1] 'You can't repeat the past,' the narrator says to Jay Gatsby in F Scott Fitzgerald's iconic novel. [1] Hopelessly romantic and ever optimistic, Gatsby responds: 'Can't repeat the past? Why of course you can!' If only

Van der Westhuizen J (Cameron J, Froneman J and Majiedt AJ concurring, and Khampepe J concurring only on the cross-appeal)

A we could repeat, rerun or reshape history to avoid the injustices of the apartheid era. But we cannot. Perhaps the best that can be done is to try to redress past injustices by enacting and applying legislation under the Constitution of our young democracy to deal with some of the consequences of the apartheid regime's treatment of the majority of South Africans. B

[2] The Promotion of National Unity and Reconciliation Act [2] is one example. The Restitution of Land Rights Act [3] (Restitution Act) is another. It represents an attempt to address evictions, forced removals and past dispossession of land. The Group Areas Act [4] — one of the C cornerstones and most pernicious pieces of apartheid legislation — used race to determine the area in which people were allowed to live. Many were deprived of their homes and land because of the colour of their skin. The members of the Florence family are among them.

[3] One of the underlying questions is whether restitution should act as D a means of reversing the injury itself, knitting the bones of history together as if no fracture had ever occurred, or instead as a salve for an ever gaping wound. Section 25(7) of the Constitution [5] promises that persons or communities dispossessed of property as a result of racially discriminatory laws or practices are entitled to restitution of the property E or to equitable redress. The Restitution Act provides for the fulfilment of this promise. Ms Florence, the applicant, asks this court to decide what constitutes equitable redress under the Restitution Act. Is it always appropriate for a court — when making an award in the form of financial compensation — to convert past property into present-day monetary terms using the Consumer Price Index (CPI)? [6] This is what the Land F Claims Court did and the Supreme Court of Appeal confirmed. Ms Florence argues that this does not give sufficient effect to the right to restitution or equitable redress and applies for leave to appeal against the Supreme Court of Appeal's decision.

[4] The government, the respondent, opposes the application. In addition G it applies for leave to cross-appeal and asks this court to set aside the Supreme Court of Appeal's decision to order the state under the Restitution Act to bear the costs of a memorial plaque on the property as a form of symbolic relief.

Van der Westhuizen J (Cameron J, Froneman J and Majiedt AJ concurring, and Khampepe J concurring only on the cross-appeal)

Issues A

[5] The main appeal questions the concept of equitable redress under the Constitution and the Restitution Act. The cross-appeal requires us to decide whether interference with the Supreme Court of Appeal's discretion under the Restitution Act in directing the state to bear the costs of the erection of a memorial plaque is justified. B

[6] Subsidiary questions are raised:

(a)

Should condonation for the late filing of documents be granted?

(b)

May this court interfere with the exercise of discretion by the Land Claims Court and the Supreme Court of Appeal? C

(c)

Should leave to appeal be granted?

(d)

What is the meaning of 'equitable redress' in the Restitution Act? In light of this, what is the purpose of financial compensation?

(e)

Is the CPI an appropriate means of converting past loss into present-day monetary terms?

(f)

If not, are alternatives available? D

(g)

What is the significance of s 33 of the Restitution Act?

(h)

Given the above, is interference with the Land Claims Court's exercise of discretion warranted?

(i)

What order should follow if the decision by the Supreme Court of Appeal is set aside?

(j)

Who should bear the costs of this application? E

Factual background

[7] The Florence family lived in a house called Sunny Croft, on erf 44408 (the property) in present-day Rondebosch, Cape Town, from December 1952 until November 1970. On 9 January 1957 Mr Florence F (the applicant's husband) and his two brothers entered into a written agreement to purchase the land from the owner, Dr Yeller. It was agreed that the purchase price was to be paid off in instalments every month for 13 years and 10 months. These instalments were met.

[8] The area in which the land was situated was classified a 'white group G area' in terms of the Group Areas Act which prevented the transfer of the property into Mr Florence's name, as he was not classified as 'white'. On 16 October 1970 Mr Florence, his brothers and Dr Yeller agreed to cancel the sale and the Florence family was refunded an amount of R1350. Because of the area's classification and harassment by the authorities, the family was forced to leave in November 1970. H

[9] On 14 December 1995 Mr Florence launched a restitution claim, in his own right and on behalf of his two brothers, in terms of the Restitution Act. The claim initially sought restoration of the entire plot of the property. Given subsequent development on the land, however, this was not feasible. The claim was therefore amended to seek equitable I redress in the form of financial compensation, as well as the erection of a memorial plaque.

[10] In June 2009, after her husband died, Ms Florence was substituted in the claim as the applicant. In March 2010 she and the current owner of the property reached a private agreement in terms of which the current J

Van der Westhuizen J (Cameron J, Froneman J and Majiedt AJ concurring, and Khampepe J concurring only on the cross-appeal)

A owner consented to the erection of a memorial plaque on the property and withdrew his opposition to the Florence family's claim. The Florence family approached the Land Claims Court for a determination of their claim, orders awarding them just and equitable compensation and the costs of erecting the memorial plaque. [7]

Land Claims Court B

[11] The case in the Land Claims Court turned on —

(a)

the nature and extent of the 1970 loss (and the amount of compensation this warranted);

(b)

the appropriate method for conversion for equitable redress;

(c)

C Ms Florence's claim for a solatium; [8]

(d)

the costs of erecting the plaque; and

(e)

the costs of litigation insofar as they had not been met by the Land Claims Commission.

Only (a) – (d) are relevant before this court.

D [12] The requirements for a claimant to qualify for restitution are listed in s 2 of the Restitution Act. [9] The Land Claims Court held that it was

Van der Westhuizen J (Cameron J, Froneman J and Majiedt AJ concurring, and Khampepe J concurring only on the cross-appeal)

not in dispute that the family had a right in land and that they were A dispossessed of this right in terms of past racially discriminatory legislation. It further held that the family had effectively paid off the purchase price at the time of their dispossession and therefore should be compensated as the de facto owners of the property.

[13] The Land Claims Court then determined the extent of the loss. [10] B Despite receiving R1350 from Dr Yeller, the Land Claims Court found that the Florence family had been under-compensated for their dispossession by R30 513 as at October 1970. Thus the R1350 could not be considered just and equitable compensation for the property so as to disqualify the Florence family from bringing a restitution claim under the Restitution Act. [11] C

[14] Having regard to the purposes of the Restitution Act, the need to give its provisions a generous interpretation, as well as the factors listed in s 33, [12] the Land Claims Court found that it would be just and equitable to convert the family's 1970 financial loss to its present-day D

Van der Westhuizen J (Cameron J, Froneman J and Majiedt AJ concurring, and Khampepe J concurring only on the cross-appeal)

A value in order to accommodate 'changes over time in the value of money', as captured in s 33(eC) of the Restitution Act.

[15] This raised the issue regarding the most appropriate method for conversion, which primarily involved the interpretation of s 33(eC). The B Land Claims Court followed its own precedent in Farjas LCC [13] and found that using the CPI for conversion accords with the proper interpretation of the phrase 'changes over time in the value of money', [14] which is 'what a person can buy with the money'. [15]

[16] The court found that 'changes over time in the value of money' C entails concepts different from an investment. An investment relates to interest earned from money. Interest accrues as the proceeds of money and is not its actual value; the value of money is not changed because interest is earned. Since interest is conceptually different from the value of money as stated in s 33(eC), an investment index is not a suitable method for conversion. The CPI measures the actual value of money and D is therefore more appropriate. On the basis of this calculation the Land Claims Court determined Ms Florence's under-compensation to be R1 488 890.

[17] In addition to this award the Land Claims Court gave Ms Florence R10 000 as a solatium, in recognition of the emotional hardship and E trauma of forced removal and in acknowledgment of the family's dignity and worth. [16] But it declined to find in her favour on the memorial plaque. First, the court held that it lacked jurisdiction because the issue was...