National Director of Public Prosecutions v Van der Merwe and Another

• Jurisdiction: South Africa
• Citation: 2011 (2) SACR 188 (WCC)

National Director of Public Prosecutions v Van der Merwe and Another
2011 (2) SACR 188 (WCC)

2011 (2) SACR p188

Citation	2011 (2) SACR 188 (WCC)
Case No	A 338/2010
Court	Western Cape High Court, Cape Town
Judge	Erasmus J, Dlodlo J and Binns-Ward J
Heard	January 28, 2011
Judgment	February 24, 2011
Counsel	AM Breitenbach SC (with SK Witten) for the appellant.; T Carter for the first respondent.; No appearance for the second respondent.

Flynote : Sleutelwoorde

Prevention of crime — Forfeiture order — Application for in terms of s 48 of Prevention of Organised Crime Act 121 of 1998 — Person having interest in property which is subject of forfeiture application having right in terms of C s 48(4)(a) to oppose making of order — Or such person may apply in terms of s 48(4)(b) for order under s 52 excluding such interest from operation of order (known as 'innocent owner defence') — Person seeking exclusionary order under s 52 to satisfy court on balance of probabilities of existence of requirements set out in either s 52(2) or s 52(2A), as case may be — Section 52 burdening person raising 'innocent owner defence' with 'reverse D onus' — Only at this stage of proceedings, when exclusionary order sought, that owner or affected interest holder's innocence or culpability arises — Onus on such person to establish his/her innocence or lack of culpability.

Prevention of crime — Forfeiture order — Forfeiture order in terms of s 48 of Prevention of Organised Crime Act 121 of 1998 — Appeal against — High E Court's power to make forfeiture order in terms of s 48(1) read with s 50 of Act discretionary one in broad sense of concept — Court on appeal less constrained in interfering with order than in case where court of first instance's discretion strict or narrow one — Appeal court may substitute its own view for that of court below if its view of merits impels different outcome to case, but will as appellate court only do so if it concludes decision of court of first instance was wrong.

F Prevention of crime — Forfeiture order — Application for in terms of s 48 of Prevention of Organised Crime Act 121 of 1998 — Wide discretionary nature of High Court's power — Decision whether to grant or refuse order made upon weighing-up of any number of relevant disparate considerations arising from facts of given case — Court to determine therefrom G whether forfeiture is rationally and proportionately appropriate manner of achieving ends of Act — This case, even when affected party not seeking exclusion order in terms of s 52 of Act — Very availability of application for exclusion also factor relevant in proportionality enquiry — Effect of forfeiture on respondent, as part of proportionality enquiry, bearing different character from that which arises in context of 'innocent owner defence' H under s 52 — Innocence or culpability of respondent playing no role in proportionality enquiry — Relevant consideration in proportionality enquiry being whether forfeiture would be disproportionate measure to achieving legislation's ends — Such case when personally punitive effect of forfeiture would materially outweigh measure of achievement of broader societal I purposes at which civil forfeiture directed.

Headnote : Kopnota

The court of first instance granted a forfeiture order in respect of cash, but refused the application in respect of immovable property. The essence of the respondents' opposition was that incidents of drug-dealing or possession of drugs that had occurred at the property were merely incidental and the manifestations of the private misconduct of delinquent employees; the J property was used as the base for a taxi business, and the cash found there

2011 (2) SACR p189

generated in the conduct of such business. The respondents did not apply A in terms of s 48(4)(b) for an exclusion order. The court a quo ordered that 'the respondents' knowledge insofar as the defences provided for in s 52(2A)(a) and (b), the so-called 'innocent owner defences', are concerned', be referred for the hearing of oral evidence. With the leave of the court a quo, the NDPP appeals against the refusal of the application for the forfeiture of the fixed property, and the first respondent cross-appeals B against the order declaring the cash forfeit, and the attendant adverse costs order. (Paragraphs [2], [3] and [10] at 192c–d, 192g–193a and 197f–g, paraphrased.)

The granting of an order referring issues that would arise for consideration in terms of s 52 for oral evidence — when there had been no application by the respondents in terms of s 48(4)(b) for an order in terms of that provision C — is a misdirection. The consideration of any application in terms of s 48(4)(b), by a respondent claiming exclusionary relief, occurs in 'the second stage of the proceedings, when forfeiture is being sought by the State' (as referred to by Ackermann J in para 18 of National Director of Public Prosecutions and Another v Mohamed NO and Others2002 (2) SACR 196 (CC) (2002 (4) SA 843; 2002 (9) BCLR 970). The nature of the order D that may be made on application in terms of s 48(4)(b) is provided for in s 52 of the Act: a person seeking an order in terms of s 52 — raising what has been loosely called the 'innocent owner defence' — has to satisfy the court, on a balance of probabilities, of the existence of the requirements set out in ss 52(2) and 52(2A) in relation to property characterised as being 'proceeds of unlawful activities' or as 'an instrumentality of an offence', respectively. E The 'innocent owner defence' is, however, not a defence properly so called, because it does not arise to be asserted against the entitlement of the NDPP, on the facts, to a forfeiture order, but arises by way of an application for an order excluding the affected party's interest from the effect of a forfeiture order to which the NDPP has proven an entitlement. It is thus in the 'second stage of the proceedings', if it is reached, that the owner or affected interest F holder's innocence or culpability arises and becomes the focus of enquiry; and the onus is on such person to establish his or her innocence or lack of culpability. (Paragraphs [4] and [9] at 193b and 195e–197c, paraphrased.)

A High Court's power to make a forfeiture order in terms of s 48(1) read with s 50 of the Act is a discretionary one in the broad sense of the concept explained in Knox D'Arcy Ltd and Others v Jamieson and Others1996 (4) SA 348 (A) at 360D – 362G. A court of appeal's ability to interfere on appeal G with the decision made by the court of first instance is therefore less constrained than in the case in which the court of first instance has exercised its discretion in the strict or narrow sense. This means that the court of appeal may substitute its own view for that of the court below if its view of the merits impels a different outcome to the case. It will, of course, do so with due consideration for its role as an appellate court, and will H interfere only if it concludes that the decision of the court of first instance was wrong. (Paragraph [11] at 197g–198c.)

The implications of the property clause in the Bill of Rights impels construing the applicable provisions of the Act in a manner that implies the requirement of a proportionality enquiry, so as to avoid the operation of the forfeiture I provisions in a manner that could offend against s 25 of the Constitution. The wide discretionary nature of the High Court's power in treating with a forfeiture application in terms of the Act is manifest in the weighing-up of any number of relevant disparate and incommensurable considerations — arising from the peculiar facts of a given case — to determine whether the means of forfeiture is a rationally and proportionately appropriate manner of achieving the ends of the Act. Thus, even in a matter in which an affected J

2011 (2) SACR p190

A party does not seek an exclusion order in terms of s 52, the effect of any forfeiture on the respondents is a matter that will generally be taken into account as part of the proportionality enquiry. The very availability of the remedy of an application for an exclusion order is also a factor that bears relevance in any proportionality enquiry. The consideration of the effect of a forfeiture on a respondent as part of the proportionality enquiry in the first B stage of the proceedings bears a quite different character from that which arises in the context of 'the innocent owner defence'. The innocence or guilt or culpability of a respondent plays no role in the proportionality enquiry. The relevant consideration in the proportionality context is whether the effect of a forfeiture on a respondent — irrespective of the latter's blameworthiness or innocence — might not show that a civil forfeiture order would, in C the circumstances, be a disproportionate measure to achieve the legislation's ends. Prima facie, that would be the case when the personally punitive effect of the postulated forfeiture would materially outweigh the measure of achievement of the broader societal purposes at which the remedy of civil forfeiture is directed. (Paragraphs [12]–[13] at 198c–199a.)

Annotations:

Cases cited

Reported cases

Southern African

Adbro Investment Co Ltd v Minister of the Interior1956 (3) SA 345 (A): referred to

First National Bank of SA Ltd t/a Wesbank v Commissioner, South African Revenue Service and Another; First National Bank of SA Ltd t/a Wesbank v Minister of Finance2002 (4) SA 768 (CC) (2002 (7) BCLR 702): referred to E

Hix Networking Technologies CC v System Publishers (Pty) Ltd and Another1997 (1) SA 391 (A) ([1996] 4 All SA 675): referred to

Humphrys v Laser Transport Holdings Ltd and Another1994 (4) SA 388 (C): dictum at 400C – E applied F

Knox D'Arcy Ltd and Others v Jamieson and Others1996 (4)...