The Importance of Economy, Commerce, Legal Certainty and Socioeconomic Development For Promoting the Constitutional Vision

• Citation: (2024) 36 SA Merc LJ 1
• DOI: https://doi.org/10.47348/SAMLJ/v36/i1a1
• Published date: 14 January 2025
• Pages: 1-40
• Author: Ali, F.
• Date: 14 January 2025

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Articles

THE IMPORTANCE OF ECONOMY,

COMMERCE, LEGAL CERTAINTY AND

SOCIOECONOMIC DEVELOPMENT FOR

PROMOTING THE CONSTITUTIONAL

VISION

FUAAD ALI*

LLM Graduate, University of South Africa

CHRIS PRETORIUS

†

Professor, Department of Private Law, University of South Africa

Abstract

The importance of the economy in South African socioeconomic

development and for achieving the objectives set by the constitutional

vision, can never be underestimated. To understand the relationship

that exists between the economy and socioeconomic development, the

simple mechanics of how production, income and spending in a basic

mixed economy operate are briefly explained. There is a significant

relationship between the economy, commerce, socioeconomic

development, legal certainty, and substantive equality all of which can

conceivably work harmoniously together to create a truly egalitarian

society. However, some key threats that are hindering the achievement

of the constitutional vision are unemployment, poor economic growth,

corruption within the private and public sectors, as well as the

Covid-19 pandemic. The economy and commerce have a major role to

play on socioeconomic development in South Africa, by contributing to

socioeconomic development and reform and the longer-term

development of an egalitarian society. To achieve the constitutional

* DCom BBA LLB LLM (Unisa) MBA (Thames Valley University).

†

BLC LLB (UP) LLD (Unisa).

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vision of creating an equal and prosperous South African society, both

business and government have a very important role to play.

Therefore, the important role of business and the commercial need for

legal certainty in contracts is critical.

Keywords: constitutional vision; socioeconomic development; mixed

economy, commerce, legal certainty, contract law; pacta sunt servanda,

substantive equality

I. INTRODUCTION

In a developing unequal society such as South Africa,

1

the importance of

economic development, commerce, socioeconomic rights, substantive

equality, and the realisation of the constitutional vision cannot be

overstated. Economic development, coupled with socioeconomic

development and substantive equality that will pave the way for the

creation of wealth and freedom from material need for all citizens,

2

and

the realisation of socioeconomic rights,

3

is key to achieving the

constitutional vision.

4

The Constitution of the Republic of South Africa,

1996 embraces an aspiration to realise in South Africa a democratic,

1

StatsSA, ‘Inequality Trends in South Africa: A multidimensional diagnostic of inequality’

(Statistics South Africa, 2019) 2; see also World Bank, ‘Overcoming Poverty and Inequality in

South Africa An Assessment of Drivers, Constraints and Opportunities’ (World Bank 2018)

xv; Webster, ‘Why South Africa is the world’s most unequal society’ available at https://

mg.co.za/article/2019–11–19-why-sa-is-the-worlds-most-unequal-society/, accessed on

27 May 2022; Hundenborn, Woolard & Jellema, ‘The effect of top incomes on inequality in

South Africa’ (2019) 26 International Tax and Public Finance 1019; see also TPS, ‘Inequality

and Economic Inclusion, available at https://www.tips.org.za/research-archive/inequality-

and-economic-inclusion, accessed on 04 January 2021.

2

See Philip, Tsedu & Zwane, The impacts of social economic inequality on economic

development in South Africa (UNDP 2014) 11–19.

3

See section 24 (the right to a healthy environment); section 25(5)–(9) (the right of access

to land, to tenure security and to land restitution); section 26 (the right of access to adequate

housing and protection against arbitrary evictions and demolitions); section 27 (the right to

have access to — health care, food and water, social security, including, if people are unable to

support themselves and their dependants, appropriate social assistance); section 28(1)(c) and

(d) (the right to basic nutrition, shelter, basic health and the right to be protected from

maltreatment, neglect, abuse or degradation); section 29 (the right to education), of the

Constitution.

4

The Preamble of the Constitution, states the ‘Constitution aims to: heal the divisions of

the past and establish a society based on democratic values, social justice and fundamental

human rights; improve the quality of life of all citizens and free the potential of each person;

lay the foundations for a democratic and open society in which government is based on the

will of the people, and in which every citizen is equally protected by law; build a united and

democratic South Africa that is able to take its rightful place as a sovereign state in the family

of nations’. For a good discussion on the vision of the Constitution and what it entails see

Langa, ‘The vision of the Constitution’ (2003) SALJ 670–679.

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egalitarian society committed to social justice and self-realisation

opportunities for all.

5

Socioeconomic rights are the rights given to people to empower them

to acquire the necessary ‘opportunities’, ‘resources’ and ‘services’ to

enable them to live a life of dignity.

6

Government has a constitutional

obligation to make these rights accessible and to protect citizens against

their violation, while at the same time assisting citizens to fulfil their

rudimentary needs.

7

In the recent Beadica

8

case, the Constitutional Court appropriately

pointed out that economic growth and a robust commercial sector

which relies on contractual certainty, and the related concepts of sanctity

of contract and pacta sunt servanda, are critical requirements for

fulfilling much of the socioeconomic and other rights and promises

‘made by our Constitution’, and which are dependent on ‘sound and

continued economic development of our country’.

9

The Constitutional

Court went on to say that ‘[c]ertainty in contractual relations nurtures a

fertile environment for the advancement of constitutional rights’.

10

In Affordable Medicines Trust v Minister of Health

11

the Constitutional

Court stated that:

The law must indicate with reasonable certainty to those who are bound by

it what is required of them so that they may regulate their conduct

accordingly.

12

Recognising the importance of legal certainty in the common law of

contract for economic growth, Theron J speaking for the majority in

Beadica makes it clear that any application of the common-law rules of

contract must have as its end purpose the achievement of ‘reasonably

predictable outcomes’, that will permit individuals to contract with each

other secure in the ‘belief that they will be able to approach a court to

enforce their bargain’.

13

Therefore, our courts are required to develop

the common law of contract, in a way which promotes the development

of ‘clear and ascertainable rules and doctrines’ that must safeguard

5

Davis & Klare, ‘Transformative constitutionalism and the common and customary law’

(2010) SAJHR 404; See also Langa, (2003) SALJ 670–679.

6

Khoza (ed), Socio Economic Rights in South Africa: A resource Book 2 ed (Community Law

Centre University of Western Cape 2007) 20–21.

7

Khoza (ed) 20–21.

8

Beadica 231 CC & others v Trustees for the Time Being of the Oregon Trust & others 2020

(9) BCLR 1098 (CC).

9

Beadica paras 84–85.

10

Beadica para 85.

11

Affordable Medicines Trust v Minister of Health 2005 (6) BCLR 529 (CC).

12

Affordable Medicines Trust v Minister of Health para 108.

13

Beadica para 81.

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DEVELOPMENT FOR PROMOTING THE CONSTITUTIONAL VISION 3

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