Life Wise (Pty) Ltd v Competition Commission of South Africa

• Jurisdiction: http://justis.com/jurisdiction/166,South Africa
• Judge: N Manoim JA (M Victor Acting JP and K Savage AJA concurring)
• Judgment Date: 05 April 2022
• Docket Number: 197/CAC/Nov21
• Hearing Date: 04 March 2022
• Court: Competition Appeal Court
• Citation: 2022 JDR 2086 (CAC)

Manoim JA (Victor Acting JP and Savage AJA concurring)

[1]

The appellant before us in this matter appeals a decision made by the Tribunal to refuse to amend a provision in a consent order the appellant (Eldan) had entered into with the Competition Commission (Commission).

[2]

Eldan is the trading name of a small business, owned by historically disadvantaged persons, that is engaged in the provision of auto body repairs.

[3]

Although the Commission was a party to the order it does not oppose the

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Manoim JA (Victor Acting JP and Savage AJA concurring)

appeal.

[4]

Eldan had entered into a consent agreement with the Commission in terms of section 49D (1) of the Competition Act, 89 of 1998, (the Act), in which it admitted it had contravened three provisions of the Act, relating to price fixing, dividing markets by customer allocation and collusive tendering. [1]

[5]

When the Tribunal approves a consent agreement between the Commission and a respondent firm, it becomes an order of the Tribunal. [2] This means that despite the agreement being one between the Commission and the respondent firm, once the Tribunal has approved it, even if both parties seek to amend it, they cannot do so without the Tribunal approving it. Nor are the Tribunal's powers to amend its own orders unconstrained. An express power is given to the Tribunal to do so but in limited circumstances, in terms of section 66 of the Act. This jurisdiction is limited to errors and ambiguities in orders.

[6]

Nevertheless, the Tribunal has previously found that like a High Court it can amend one of its own orders if a respondent firm is suffering hardship due to changed circumstances (Foskor) [3] or where there are exceptional circumstances (Ferro) [4] . In its Ferro decision the Tribunal explained that:

"exceptional circumstances means unusual or unexpected circumstances" [5] . In the present case the Tribunal has used the test of exceptional circumstances.

[7]

The exceptional circumstances test derives from a decision of the Constitutional

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Manoim JA (Victor Acting JP and Savage AJA concurring)

Court in the case of Molaudzi v S. There the Court held that where a significant or manifest injustice would result if a court order would be allowed to stand, the res judicata doctrine could be relaxed in "rare and exceptional circumstances where there is no alternative effective remedy". [6]

[8]

Of course as a creature of statute, the Tribunal, unlike a High Court, does not exercise an inherent power in terms of section 173 of the Constitution, the section relied on by the Court in Molaudzi. The Tribunal's solution has been to read this power into the discretion conferred upon it in terms of section 27(1)(d) of the Act.

[9]

That section states:

27. Functions of Competition Tribunal. — (1) The Competition Tribunal may—

…..

(d) make any ruling or order necessary or incidental to the performance of its functions in terms of this Act.

[10]

Thus preventing an injustice where exceptional circumstances are made out, would, in the Tribunal's reasoning, as I understand it, constitute a basis for an order, necessary or incidental to the performance of its functions.

[11]

This court has not been previously asked to consider whether the Tribunal can rely on this power to amend one of its orders in those circumstances. [7] Since this matter is before us on an unopposed basis, it would not be appropriate for us to decide the point without the benefit of full argument by the Commission. But it is not necessary for us to do so in the present case, because the Tribunal did not

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Manoim JA (Victor Acting JP and Savage AJA concurring)

exercise this power to amend its order.

[12]

What remains for us to decide is whether, the Tribunal correctly exercised its discretion in refusing the amendment, assuming it had this power.

[13]

The Tribunal also had to decide a further jurisdictional point; whether it could grant a consent order if the respondent firm had not made an admission that it had contravened the Act? Here again the Tribunal found, based again on its past jurisprudence, that it could.

[14]

This means that the success of this appeal does not turn on any jurisdictional error by the Tribunal, since both jurisdictional issues were decided in favour of Eldan. The question is whether the Tribunal correctly found that Eldan had not made out a case for an amendment to the consent order based on exceptional circumstances.

Background

[15]

In 2014 the Commission initiated an investigation into collusion between Eldan and a competitor, Precision and Sons (Pty) Ltd...