Mohunram and Another v National Director of Public Prosecutions and Another (Law Review Project as Amicus Curiae)

• Jurisdiction: South Africa

Mohunram and Another v National Director of Public Prosecutions and Another (Law Review Project as Amicus Curiae)
2007 (2) SACR 145 (CC)

2007 (2) SACR p145

Citation	2007 (2) SACR 145 (CC)
Case No	CCT19/06
Court	Constitutional Court
Judge	Langa CJ, Moseneke DCJ, Madala J, Mokgoro J, Nkabinde J, O'Regan J, Sachs J, Van der Westhuuzen J, Yacoob J, Kondile AJ and Van Heerden AJ
Heard	November 16, 2006
Judgment	March 26, 2007
Counsel	Y N Moodley SC (with G J Leppan) for the applicants.; W Trengove SC (with A Cockrell) for the first respondent.; No appearance for the second respondent.; M S M Brassey SC (with P McNally and M J Engelbrecht) for the Amicus Curiae.

Flynote : Sleutelwoorde B

Search and seizure — Forfeiture order in terms of ch 6 of Prevention of Organised Crime Act 121 of 1998 (POCA) — Application of — Civil forfeiture order — Which offences covered — Whether civil asset forfeiture in terms of ss 48 and 50 of POCA limited to C offences created by POCA — Quaere: Whether Act applying only to offences created by POCA, namely, racketeering, money laundering and criminal gang activities, and not extending to cases of individual wrongdoing not connected to organised crime — D Whether forfeiture in respect of individual wrongdoing not connected to organised crime amounting to unlawful and arbitrary deprivation of property as contemplated by s 25(1) of Constitution of the Republic of South Africa, 1996.

Search and seizure — Forfeiture order in terms of ch 6 of Prevention of Organised Crime Act 121 of 1998 — Application for order E of civil forfeiture — Which property liable to forfeiture — 'Instrumentality of an offence' — What constitutes — Whether property from which illegal casino being operated qualifying as such.

Search and seizure — Forfeiture order in terms of ch 6 of Prevention of Organised Crime Act 121 of 1998 — Application for order F of civil forfeiture — Proportionality enquiry — Approach of Court — Court weighing up forfeiture against purpose served — Relevant factors — Enquiry in all cases being whether, in all circumstances of case, forfeiture disproportionate to offences involved.

Search and seizure — Forfeiture order in terms of ch 6 of Prevention of Organised Crime Act 121 of 1998 — Application for order G of civil forfeiture — Proportionality enquiry— Onus of proof — Onus of establishing all requirements for forfeiture order, including proportionality, resting on applicant — However, some facts relevant to proportionality analysis often peculiarly within knowledge of owner of property — Therefore, owner bearing evidentiary burden to place such facts before court. H

Fundamental rights — Right not to be deprived of property arbitrarily — Forfeiture order in terms of ch 6 of Prevention of Organised Crime Act 121 of 1998 (POCA) — Statutory civil asset forfeiture — Quaere: whether POCA offending s 25 of Constitution in matters beyond ambit of organised crime offences — Whether forfeiture disproportionate (and hence constitutionally unacceptable) — I While purpose of civil forfeiture in terms of ch 6 of Act being deterrence and removal of incentive to commit crime, such not unlimited — Civil forfeiture under POCA not substitute for effective enforcement of 'ordinary' civil remedies — Civil asset forfeiture constituting serious incursion into well-entrenched civil protections, particularly against arbitrary and excessive punishment and against arbitary J

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confiscation of property — Civil forfeiture always to be viewed against protection of individual rights to property — Constitution of the A Republic of South Africa, 1996, s 25.

Headnote : Kopnota

Quaere (per Moseneke DCJ, Mokgoro J and Nkabinde J): Whether the offences for which forfeiture is potentially competent in terms of ch 6 of the Prevention of Organised Crime Act 121 of 1998 (POCA) are limited to those created by POCA. These are B racketeering under ch 2, money laundering under ch 3 and criminal gang activities under ch 4. They may collectively be termed 'organised crime offences' and the rest may conveniently be called 'ordinary crimes'. Further, since unlicensed gambling, without more, is not an organised crime offence, no order of forfeiture can competently be made under POCA on the basis of the provisions providing for the forfeiture of the instrumentalities of such an offence. The phrase 'instrumentality of an C offence referred to in Schedule 1' in s 50(1) of POCA should be interpreted as requiring that the offence should not only be a Schedule 1 offence, but also an organised crime offence created by Chs 2, 3 and 4 of POCA. On this reasoning, although gambling offences appear in Schedule 1, they will attract civil forfeiture only if they are also organised crime offences. If the D meaning given to 'offence' runs wide and well beyond organised crime in a way that includes all the acts of individual wrongdoing listed in Schedule 1, it would be inconsistent, not only with the purpose and text of the statute, but more importantly with the prohibition against unlawful and arbitrary deprivation of property set by s 25(1) of the Constitution of the Republic of South Africa, 1996. It would also constitute disproportionate and irrational punishment not permitted by s 12(1)(e) E of the Bill of Rights. (Paragraphs [112] and [115] at 184e - 185a and 186b - c.)

Statutory civil forfeiture of assets is meant to pursue worthy and noble objectives aimed at curbing serious crime. And yet there is no gainsaying that, in effect, it is Draconian. It is premised on the notion that it is a civil remedy and that the prosecution or the State has to show only on a balance of probabilities that the property may be seized and forfeited to the F State. The criminal standard of proof does not come into it. When the State seeks civil forfeiture of assets that were used in the commission of a crime, it is not required to show that the owner has been convicted of the offence or that the owner performed an unlawful act with a criminal intent. The initial and central enquiry in asset forfeiture is whether the property is an G instrumentality of an offence. If it is, the property is liable to be declared forfeit to the State. (Paragraph [118] at 186f - 187b.)

In principle, the closer the criminal activities are to the primary objectives of the Prevention of Organised Crime Act 121 of 1998 (POCA), the more readily should a court grant a forfeiture order. Conversely, the more remote the activities are from these objectives, the more compelling must the circumstances be to make such an order appropriate. Furthermore, any H determination of proportionality should take into account the extent to which the common law and statutes prove (or threaten to be) inadequate in the circumstances. While the primary purpose of POCA in relation to the instrumentality of an offence is to deter people from using property for crime, that purpose cannot legitimise the forfeiture of every instrumentality of an I offence. Deterrence as a law-enforcement objective is constrained by the principle that individuals may not be used in an instrumental manner as examples to others if the deterrence is set at levels beyond what is fair and just to those individuals. To do otherwise would be to breach the constitutional principle of dignity. In each case, therefore, care needs to be taken to ensure that the purpose of deterrence that the legislation serves J

2007 (2) SACR p147

does not produce a disproportionate impact on the owner of the forfeited property. It is for this reason that the deterrent A purpose of the legislation must be weighed against the effect on the individual owner, in light of the relevant offence. In this respect, the extent to which the forfeiture manifestly is directed towards preventing organised crime will be highly relevant. The disjuncture between the basic purposes of POCA and the effect on the individual concerned should never be too great. B (Paragraphs [145] - [147] at 194f - 195f.)

The first applicant, through the second applicant (a close corporation), of whom he was the sole member, ran an unlicensed gambling operation in contravention of the KwaZulu-Natal Gambling Act 10 of 1996 on certain premises subsequently forfeited under the Prevention of Organised Crime Act 121 of 1998 (POCA). The premises were used for both a legal trade, and for C operating gambling machines without a licence - an illegal trade under the Gambling Act. The first applicant was arrested and charged under that Act, pleaded guilty and paid an admission of guilt fine. Further, his gaming machines were seized and destroyed. The NDPP subsequently launched proceedings for civil forfeiture in respect of the premises. In the Constitutional D Court, the applicants sought leave to appeal against the decision of the Supreme Court of Appeal (National Director of Public Prosecutions v Mohunram and Others 2006 (1) SACR 554) upholding an appeal against a High Court decision and replacing it with one declaring the immovable property belonging to the second applicant forfeit to the State in terms of POCA on the ground that it was an 'instrumentality' of an offence. The issues that fell to be decided were: (a) whether the property E concerned was an instrumentality of an offence; (b) the meaning of 'offence' in the context of civil forfeiture authorised by ch 6 of POCA; and (c) whether the forfeiture sought was disproportionate. There was no dispute regarding (a), but the Court disagreed as to whether such forfeiture was disproportionate. On the facts, the majority (per Moseneke DCJ, Mokgoro J and F Nkabinde J concurring, with a separate concurring judgment by Sachs J, O'Regan J and Kondile AJ concurring) held that it was. Accordingly the appeal was upheld and the order of the Supreme Court of Appeal was replaced...