Premier, Eastern Cape, and Others v Cekeshe and Others

• Jurisdiction: South Africa
• Citation: 1999 (3) SA 56 (TK)

Premier, Eastern Cape, and Others v Cekeshe and Others
1999 (3) SA 56 (TK)

1999 (3) SA p56

Citation	1999 (3) SA 56 (TK)
Case No	1091/97
Court	Transkei Division
Judge	Somyalo JP, Madlanga J and Locke J
Heard	April 3, 1998
Judgment	September 23, 1998
Counsel	PB Hodes (with him RP Quinn and SV Notshe) for the appellants; NK Dukada for the respondents

Flynote : Sleutelwoorde

Constitutional law — Human rights — Right to administrative justice in terms of s 33 in chap 2 of Constitution of the Republic of South Africa Act 108 of 1996 — Whether exercise of statutory power requiring compliance with rules of G natural justice — Impact of administrative action taken under legislation, rather than whether or not action in interests of community as a whole, of paramount importance — Commendable to move away from labels so that Courts concern themselves with whether circumstances of given case, and not form of act, warrant compliance with s 33 — Section 33 requiring procedural fairness in respect of subordinate legislative action — Decision of provincial Premier to H dissolve agricultural corporation in terms of s 13 of Corporations Act 10 of 1985 (Tk) — Exercise by Premier of statutory power under s 13 effectively terminating employment of all respondents — Right to continued employment, if threatened, the basis of application of audi alteram partem principle.

Administrative law — Administrative act — What constitutes — Decision of provincial I Premier to dissolve agricultural corporation in terms of s 13 of Corporations Act 10 of 1985 (Tk) — Once valid decision taken to act and implementation thereof valid in terms of empowering legislation, resulting proclamation a 'piece of subordinate domestic legislation', but decision to act an administrative act — Such administrative act subject to judicial review. J

1999 (3) SA p57

Headnote : Kopnota

The first appellant had issued Proc 10 of 1997 in terms of s 13 of the A Corporations Act 10 of 1985 (Tk) (the Corporations Act), whereby he dissolved the Transkei Agricultural Corporation (Tracor). In terms of s 13(3) the first appellant was required to submit the proclamation to the provincial legislature within 30 days. This was not done. The respondents, employees of Tracor, had approached a Provincial Division for an order, inter B alia, setting aside Proc 10 on the grounds, inter alia, that the decision taken to dissolve Tracor was procedurally unfair and that the closure of Tracor was an unfair labour practice. The order was granted and the appellants appealed to a Full Bench of the Provincial Division, contending that the proclamation (i) was original legislation and as such not subject to review; (ii) did not constitute administrative action and therefore did not have to comply with the provisions of s 33 of the Constitution of the Republic of South C Africa Act 108 of 1996 (the Constitution); and (iii) the Court a quo had erred in finding that the power exercised by the first appellant fell within category (b) as enumerated in South African Roads Board v Johannesburg City Council 1991 (4) SA 1 (A). The appellants further relied upon Pretoria City Council v Modimola 1966 (3) SA 250 (A) in arguing that Proc 10 affected members of the community equally D and therefore the audi alteram partem rule did not apply. It was further contended that the closure of Tracor was not an unfair labour practice as there was no employment relationship between the appellants and the respondents, the respondents having been employed by Tracor.

Held (per Locke J), that Parliament could never be taken E to intend to give an official or an administrative body the power to act in bad faith or the power to abuse his, her or its powers. Such powers were conferred on an official or an administrative body to promote the policy and/or objects of the relevant Act. When the Court said it would intervene if a particular body had acted in bad faith it was but another way of saying that such power had not been exercised within the scope of the statutory authority given by Parliament. (At 72B - C.) F

Held, further (per Locke J, Somyalo JP and Madlanga J concurring), that, once there had been a valid decision to act and a valid implementation thereof in terms of the empowering legislation, the proclamation which resulted would then have been a 'piece of subordinate domestic legislation', but the decision to act was an administrative act. (At 72H/I - I/J.)

Held, further, that it was trite that the exercise of a discretion by a public official vested by statute with G jurisdiction to decide a matter affecting members of the public was subject to judicial review at common law. (At 72J - 73A.)

Held, further, that Proc 10 could not be divorced from the exercise of the discretion or the administrative acts leading to the promulgation of the proclamation itself. It was accordingly not necessary to have to determine H whether Proc 10 was original legislation. The administrative acts in question were clearly subject to judicial review at common law and subject to the Constitution. (At 73H/I - 74B, 74H/I - I/J, 78I/J and 80I - J.)

Held, further (per Locke J), that delegated legislation could not be equated to an Act of Parliament. A body which was exercising functions which were legislative in form and substance might be subject to the I rules of natural justice. The fact that a body endowed with a statutory power should have taken into account the public interest as a relevant consideration in the exercise of the power did not necessarily exclude the duty to act fairly towards an affected individual. The mere fact that a decision was embodied in an instrument that was legislative in form did not necessarily preclude the imposition by implication of an opportunity to be heard. (At 77D/E - F/G.)

Held, further, that a Court was not precluded from pronouncing upon the J

1999 (3) SA p58

validity of subordinate legislation, including a proclamation, whether issued by A the State President or any other official of the State. (At 77G/H.)

Held, further (per Locke J, Somyalo JP and Madlanga J concurring), that the legislative authority for the province of the Eastern Cape was the only constitutional body empowered to pass laws in the province provided that such laws fell within its competence. The Premier had merely been assigned B certain powers by the provincial legislature in the Corporations Act. The Premier did not have plenary powers to legislate. (At 77J - 78B.)

Held, further, that Proc 10 was not original legislation which enjoyed protection from judicial scrutiny and review and the Court had the jurisdiction to declare Proc 10 invalid and to set it aside. (At 80G/H and 80H/I.)

Held, further (per Locke J), that the failure by the first C appellant to comply with s 13(3) did not result in Proc 10 becoming void and of no force and effect but rather that this was further evidence of his failure properly to exercise his statutory powers in enacting Proc 10. (At 82E - F.)

Held, further, that, as the respondents had not been given a hearing before the proclamation had been issued, the onus was on the appellants to prove that (i) the proclamation affected equally members of the D community at large and (ii) the closure of the corporation had been designed to serve the best interests of the community at large. (At 90D - E.)

Held, further, that it had not been proved that every member of the community had equally been affected by the proclamation. How the members of the community were to be affected by the proclamation or how the closure of Tracor was designed to serve the best interests of the community at large had not even E been determined at the time the proclamation was issued. (At 90E/F - G/H.)

Held, further, that, on the facts of the case, the appellants had not shown that they had been guided solely by what they believed to be best for the community as a whole and had not been obliged to consider the particular interests of particular members of that community. Accordingly the failure by the appellants to give the respondents a fair hearing violated the rules of F natural justice. (At 91C - F.)

Held, further, that s 13 of the Corporations Act did not exclude, either expressly or by way of necessary implication, the principles of natural justice, including the right to be heard. The mere fact that s 13 did not specifically make provision for a hearing in compliance with the audi alteram partem principle did not mean that there was no such right. (At G 91G - H/I.)

Held, further, that, although there might have been no de jure employment relationship between the appellants and the respondents, there was certainly a de facto one requiring fair labour practices and decisions affecting the respondents. (At 93H/I - I.)

Held, further, that the first appellant, in the course of the H discharge of his duties in terms of the provisions of the Corporations Act, had a duty to act fairly and reasonably towards the employees of Tracor. (At 95E/F.)

Held, further, that the Court had not been called upon to make a finding on the viability of Tracor or whether it should be closed down or not. A distinction had to be drawn between the merits of the decision and the process I of reaching it. Even if the merits were unassailable, they could not justify an infraction of the rules of procedure in which the principles of natural justice had been ignored or subverted. The merits and the procedure could not be ignored. (At 95G/H - I.)

Held, accordingly, that the principles of natural justice had been violated in respect of the decision reached by the first appellant to dissolve Tracor. The decision accordingly had to be declared to be no decision. (At 96C/D - D.)

Held, further (per Madlanga J, Somyalo JP concurring), that, inasmuch as J

1999 (3) SA p59

...