Legal expenses POCA clauses: A loophole to make crime pay?

• Jurisdiction: South Africa
• Date: 06 September 2019
• Pages: 309-332
• Citation: (2011) 24 SACJ 309
• Published date: 06 September 2019
• Author: Nkululeko Christopher Ndzengu

Legal expenses POCA

clauses: A loophole to make

crime pay?*

NKUlUleKO cHristOPHer NDZeNGU** &

JOHN c VON BONDe***

aBstract

‘If the crimina l offender can expend the proceeds of crime without limitation

to cha llenge t he forfeitu re ac tion a nd wit h the knowledge that when the

case is lost, whatever is left wi ll be forfeited to the state, the offender has

no incentive to do anything other than to f‌ight the forfeiture unt il all of the

restrained fu nds have been exhausted’1

The Prevention of Organised Crime Act 121 of 1998 (POCA) a ims

to di slodge t he f ruits of crimin al ac tivity from the hands of criminal s

and their cohort s thus endeavouri ng to take the prof‌it out of crime.

Simultaneously however, certain provisions of POCA a llow alleged

crim ina ls to access forfeite d assets in order to cove r their leg al expen ses.

These provisions have to be reconciled with, on the one hand, the

specif‌ic res titution ary right s of victi ms of cri me and, on the o ther hand,

the general interests of the communit y i n e nsuring that crime should

not pay. Thi s article attempts to assess crit ically how these divergent

interests have been weighed and balanced by the courts. This a rticle

shows that – by means of their asset forfeiture jurisprudence – South

African (SA) courts have created distinct criteria that are to be taken into

account in ord er to re conci le thes e pote ntial ly con f‌lict ing in teres ts. T his

jurisprudence is ana lysed and the criteri a that assist in resolving t he

apparent conf‌lict are expou nded.

* The views expressed in this paper are those of the authors alone and do not represent

the views of the South African National Prosecution Authority or Nelson Mandela

Metropolitan University.

** BA LLB (RU) LLM (NMMU), Attorney of the High Court of South Africa, Deputy

Director of Public Prosecutions: Asset Forfeiture Unit (AFU), Bloemfontein. I am

grateful for the assistance of my colleagues in the AFU as well as my wife, Lolla, in

this research.

*** BJuris LLB (UPE) LLD (NMMU), Attorney of the High Court of South Africa, Senior

Lecturer, Department of Criminal and Procedural Law, Nelson Mandela Metropolitan

University.

1 TS Greenberg, LM Samuel, W Grant & L Gray Stolen Asset Recovery: A good Practice

Guide for Non – Conviction Based Asset Forfeiture (2009) 74fn139.

309

(2011) 24 SACJ 309

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1. Introduction

While respecting constitutional individual rights to human dignity,2

eq ua l it y,3 freedom,4 a nd property,5 the Preamble to the Prevention of

Organised Cr ime Act (POC A)6 sets out its objectives as, among others,

combating crime and making sure that no criminals benef‌it from it or are

entitled to use targeted propert y to facilitate crime.7 Divergent interests

are at play here; if the State cannot prove wrongdoing and benef‌it as

well as the illegal use of assets by the al leged crimi nal,8 the latter will

retain and enjoy t he constitutionally protected property rights. The

converse is that the State or the victim of the underlying crime will only

acquire such property rights subsequent to the f‌inalization of the asset

forfeiture process. Mention is made of a victim because the overall goal

of asset recovery is, in fact, to return t he assets to the victim.9

In this article an attempt is made to assess critically how t hese

divergent interests have been weighed and balanced by courts in

relation to POCA’s provisions for a claimant’s right to legal expenses.

The eff‌icacy of the latter provisions in relation to the overall objectives

of POCA (making sure t hat the crimi nal benef‌it is dislodged f rom the

claimant’s hands, faci litating instruments are per manently removed

from public circulation and that cr ime eventually does not pay) is

analysed. This analysis is conf‌ined to South African asset forfeiture

judgments since 1999 dealing with legal expenses; it does not directly

address the separate issue of the clai mant’s living expenses.10

2 Section 10 of the Constitution of the Republic of South Africa, 1996.

3 Section 9 of the Constitution of the Republic of South Africa, 1996.

4 Section 12 of the Constitution of the Republic of South Africa, 1996.

5 Section 25 of the Constitution of the Republic of South Africa, 1996.

6 Act 121 of 1998 (POCA) which replaced the Proceeds of Crime Act 76 of 1996.

7 Absa Bank Ltd v Fraser and Another [2006] 2 All SA 1 (SCA) at paras [1], [24] and [26];

NDPP v Carolus and Others [2000] 1 SA 1127 (SCA) at paras [9]-[30]; NDPP v Basson

[2002] 1 SA 419 (SCA); NDPP v Rebuzzi [2002] 2 SA 1 (SCA); NDPP v Mohamed NO

& Others [2002] 4 SA 843 (CC) at paras [14]-[16]; Fraser v Absa Bank Ltd (NDPP as

Amicus Curiae) 2007 (3) SA 484 (CC).

8 Hereinafter politely referred to as the claimant.

9 NDPP v Rebuzzi supra (n7) at para [19]; Greenberg op cit (n1) 74fn139.

10 The suggestion by Greenberg, op cit (n1) 77, of under which circumstances living

expenses ought to be provided is commendable for both criminal and civil forfeiture

purposes. The claimant must disclose fully and frankly and establish that he or she has

no other assets to f‌inance litigation other than those under restraint or preservation.

He or she is not entitled to maintain the same lifestyle previously accustomed to. If

living expenses are to be released at all, only subsistence-level support should be

permitted.

310 SACJ . (2011) 3

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