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This edition of the PAJA Newsletter begins withgeneral comments about two cases. The first,Vumazonke v MEC for Social Development,Eastern Cape, and three similar cases 2005(6) SA 229 (SE), a judgment of the High Courtin Port Elizabeth High Court is discussed in thebody of the newsletter as well. It is mentionedat the head of the document in order to high-light its important comments about the state ofpublic administration in the Eastern Cape. Thesecond case, Steenkamp NO v Provincialtender Board, EC [2006] 1 All SA 478 (SCA)is reviewed at the outset because the casedoes not fit easily into the section into whichthe Newsletter is usually divided.

Vumazonke v MEC for Social Development,Eastern Cape, and three similar cases 2005(6) SA 229 (SE) (see below under section 6)was an application seeking to review theactions of the Eastern Cape MEC for Socialdevelopment on the grounds that no decisionin respect of the applicants' applications forsocial welfare grants had been taken. Plasket Jbegan by expressing his extreme dissatisfac-tion with the sheer volume of applications com-plaining of maladministration in the EasternCape Department of Social Welfare. InNovember 2004, he said, the motion court ofthe division dealt with over 100 applications ofthis nature - and this was by no means aunique occurrence. He referred to a number ofcases where judges of the high courts hadexpressed similar outrage at the inefficiencyand ineptitude of the department. In Somyani vMEC for Welfare, Eastern Cape and Another(unreported case of the SECLD, case num-ber1144/01) the situation had

"proceeded to the point where the respondentswere called upon to show cause why they shouldnot be committed to prison for contempt of Courtbecause of their failure to give heed to Courtorders." (quoted at para 3)

In Ndevu v MEC for Welfare, Eastern Capeand Another (unreported, SECLD, case num-ber 597/02), Erasmus J was faced with a simi-lar avalanche of claims.

"Erasmus J commented that the fact that theapplicants in these matters 'found it necessary toturn to the court for assistance would indicate thatthe respondents and the public servants undertheir control have failed to perform their adminis-trative duties properly and timeously'. It would, hesaid, be unrealistic to assume that 'this is the endof the sorry saga 'because there were a further 34similar matters on the next Motion Court roll and,in view of the fact that many people do not haveaccess to legal advice and representation, 'thematters that do come to court are probably but thetip of the iceberg'. This raised the 'disturbing likeli-hood that many persons in this province at thismoment are suffering real hardship through theineffectiveness of the public service at provinciallevel'." (at para 4, footnotes omitted)

The same disgust was expressed in two judg-ments handed down by Leach J:

"In Mbanga v MEC for Welfare, Eastern Cape, andAnother, [2002 (1) SA 359 (SE)] Leach J statedthat while 'patience is a virtue, I venture to suggestthat even the patience of Job would have beentested by the inefficiency of officialdom in this caseas, notwithstanding regular enquiries being madeto the office of the Department of Welfare in PortElizabeth, time passed without any indicationwhether the applicant's application had beengranted or refused'. And in Mahambehlala v MECfor Welfare, Eastern Cape, and Another, [2002 (1)SA 342 (SE)] he spoke of the 'administrative slothand inefficiency which currently bedevils theDepartment of Welfare in the Eastern Cape'." (atpara 6, footnotes omitted)

Cameron JA in the Supreme Court of Appealentered the fray in Permanent Secretary,Department of Welfare, Eastern CapeProvincial Government and Another v Ngxuzaand Others 2001 (4) SA 1184 (SCA):

"The papers before us recount a pitiable saga ofcorrespondence, meetings, calls, appeals,entreaties, demands and pleas by public interestorganisations, advice offices, district surgeons,public health and welfare organisations andbranches of the African National Congress itself,which is the governing party in the Eastern Cape.The Legal Resources Centre played a central partin coordinating these entreaties and in the negoti-ations that resulted from them. But their effortswere unavailing. The response of the provincialauthorities as reflected in the papers includedunfulfilled undertakings, broken promises, missedmeetings, administrative buck-passing, manifest

CASE LAWTHE PROMOTION OF

ADMINISTRATIVE JUS-TICE ACT (PAJA)

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lack of capacity and at times gross ineptitude." (atpara 8, quoted at para 7)

The list goes on. What Plasket J makes clear inthis judgment, though, is that judicial criticismof the department has had no effect. Since asfar back as 2001 the courts of the SouthEastern Cape have voiced telling criticisms ofthe ineptitude, inefficiency and general admin-istrative disarray of the department - but thenumber of people suffering under the weight ofthis inefficiency has clearly not diminished. Thechallenge for the courts, then, is what to do toensure that people's welfare rights do not con-tinue to be systematically ignored:

"Judges have criticised the performance of theDepartment of Social Development, not becausethey see themselves as super-ombudsmen orwish to involve themselves in politics, but becausethe administrative failings of the department haveconsequences that bring its performance withinthe heartland of the judicial function: those failingsinfringe or threaten the fundamental rights of largenumbers of people to have access to social assis-tance, to just administrative action and to humandignity. When rights are infringed or threatened,the impugned conduct becomes very much thebusiness of the judiciary: s 38, s 165 and s 172 ofthe Constitution of the Republic of South Africa,1996 (the Constitution) make that abundantlyclear, placing as they do a duty on the judiciary toremedy such infractions. The problem faced bythe judiciary in the Eastern Cape in social assis-tance cases is, however, of a different order. Itrelates to the boundaries of the judicial function -to the limits of the institutional competence of thecourts to engineer administrative efficiency." (atpara 9, footnotes omitted)

As a final statement, Plasket J reminded theMEC for Welfare in the Eastern Cape that shebears the responsibility for ensuring that socialwelfare needs in her province are attended tofairly, efficiently and thoroughly, Her failure toensure this amounts to nothing less than a directbreach on her part of a constitutional duty:

"Two final points must be made before I proceedto deal with the individual cases before me. Thefirst is that the time for talk and no action has longpassed. Something drastic and concrete must bedone to remedy a serious, systemic infringementof the Constitution and the law - and the principlesof good administration - by the respondent'sdepartment. The second is that the Premier, as theperson in whom executive authority in theprovince is vested, is ultimately responsible for themanner in which Members of the ExecutiveCouncil and their departments perform. I make this

point, not to tell the Premier what to do, but tostate the obvious constitutional point that in termsof the Constitution, the buck stops with her: this isalso made clear in the oath of office taken byPremiers (and Members of the Executive Council),in terms of which incumbents swear or affirm anoath to 'obey, respect and uphold the Constitutionand all other law of the Republic'." (at para 22,footnotes omitted)

Steenkamp NO v Provincial Tender Board,EC [2006] 1 All SA 478 (SCA) concerned anaction for damages in delict by the appellant,the liquidator of Balraz Technologies (Pty) Ltd(Balraz). Balraz tendered successfully for acontract offered by the Eastern Cape govern-ment for the provision of automated cash pay-ment systems for pensions and other socialwelfare grants. The award of this contract waschallenged by Cash Paymaster Services (Pty)Ltd (Cash Paymaster Services (Pty) Ltd vEastern Cape Province and others 1999 (1) SA324 (CkH)). Balraz then went into liquidation.The appellant liquidator then approached theHigh Court seeking compensation for theexpenses Balraz had incurred performing interms of the contract before it was set aside onreview. In the court a quo the questions of cau-sation and loss were separated, and only thequestions of negligence and wrongfulnesswere argued before the court. The applicationwas dismissed, and the appellant approachedthe Supreme Court of Appeal (SCA). Theessential question before the SCA waswhether a breach of an administrative law dutycan found delictual wrongfulness and a causeof action for damages in delict.

The appellant's case was that the TenderBoard had acted wrongfully in respect of Balrazbecause it owed it a duty in law to (i) exerciseits powers and perform its functions fairly,impartially and independently; (ii) take reason-able care in the evaluation and investigation oftenders; (iii) properly evaluate the tenders with-in the parameters imposed by the tender spec-ifications; and (iv) ensure that the award of thetender was reasonable in the circumstances (atpara 4). It was essentially the appellant's argu-ment that since the Tender Board had made adecision that was reviewable, it had breachedthese four administrative law duties. Its con-duct in awarding the tender to Balraz wastherefore wrongful. As to the question of negli-gence, the appellant argued that because theTender Board had failed to take reasonable

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care in the evaluation of the tenders by disre-garding the comments of two technical evalua-tion committees, failing to consider the actualcosts of the tenders and instead consideringunit-costs only; and over-emphasising the gov-ernment's policy of transformation and devel-opment, the Tender Board had been negligentin the discharge of its duties (at para 5).

This is not the first case in our law dealing witha claim for damages from an initially success-ful tenderer. Similar claims were made in Knopv Johannesburg City Council 1995 (2) SA 1 (A)and Premier, Western Cape v FaircapeProperty Developers (Pty) Ltd 2003 (6) SA 13(SCA). In both those cases, though, the claimsfor damages we dismissed. The SCA began itsconsideration of the claim with this statement:

"A useful starting point in considering the nature ofthe legal duty of the Board towards tenderers ingeneral is to remind oneself a legal duty may haveits origins in either statute law or the common lawand that the breach of every legal duty, especiallyone imposed by administrative law, does nottranslate by necessity into the breach of delictualduty, ie a duty to compensate by mean of the pay-ment of damages" (at para 19)

The SCA pointed out that one of the difficultiesinvolved in basing a claim in delict on adminis-trative law is that administrative law has its ownrange of remedies. A breach of an administra-tive law duty is primarily to be remedied by theapplication of these remedies rather thanremedies found in other branches of the law.The SCA stated:

"Since the adoption of the interim Constitution thecommon-law principles of administrative law havebeen subsumed by a constitutional dispensationand every failure of administrative justice amountsto a breach of a constitutional duty, which raisesthe question whether, under the Constitution,damages are an appropriate remedy. The problembecomes more complex since the adoption of[PAJA] (which does not govern this case) whichsets out the remedies available for a failure ofadministrative justice. It may not be without signif-icance that an award of damages is not one ofthem, although an award of 'compensation' inexceptional circumstances is possible. This couldimply that remedies for administrative justice nowhave to be found within the four corners of its pro-visions and that a reliance on common-law princi-ples might be out of place. One aspect must nev-ertheless be kept in mind. A failure of administra-tive justice is not per se unlawful (in the sense ofbeing contra legem): it simply makes the decision

or non-decision vulnerable to legal challenge and,until set aside, it is valid. The award of the tenderin this case was not unlawful, it was merely vul-nerable." (at para 24)

"Subject to the duty of courts to develop the com-mon law in accordance with constitutional princi-ples, the general approach of our law towards theextension of the boundaries of delictual liabilityremains conservative. This is especially the casewhen dealing with liability for pure economic loss.And although organs of state and administratorshave no delictual immunity, 'something more' thana mere negligent statutory breach and consequenteconomic loss is required to hold them delictuallyliable for the improper performance of an adminis-trative function. Administrative law is a system thatover centuries has developed its own remediesand, in general, delictual liability will not beimposed for a breach of its rules unless convincingpolicy considerations point in another direction."(at para 27, footnotes omitted)

The court then considered the statutory frame-work governing the process and concludedthat it could not be inferred from that legislationthat an action for damages as sought by theappellant was contemplated. Against the back-ground of policy considerations pointing awayfrom the recognition of such a claim at commonlaw, the court held that the appellant's delictualaction had to fail.

This matter was heard on appeal by theConstitutional Court in May of this year. Its deci-sion will shed valuable light on the situation.

Section 1 - Administrative action defined

Johannesburg Municipal Pension Fund andOthers v City of Johannesburg and Others2005 (6) SA 273 (W) involved the decision bythe first respondent and its municipal entities("UACs") to terminate the applicant pensionfunds. The case was argued and decidedbefore the Constitutional Court handed downjudgment in the matter of Minister of Health andAnother v New Clicks SA (Pty) Ltd and Others(Treatment Action Campaign and InnovativeMedicines SA as Amici Curiae) 2006 (1) BCLR1 (CC) (reported in the June-September 2005edition of this Newsletter). For this reasonMalan J did not have the guidance of theConstitutional Court in respect of the relation-ship between section 1 of PAJA and section 33of the Constitution. His comments in this regardmust now be seen in the context of statementsfrom the Constitutional Court that overrule him.

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After finding that the action complained against(of which more below) did amount to adminis-trative action in terms of the definition thereof insection 1 of PAJA, he went on:

"However, even if I am wrong in holding that thecity and UACs' decision constituted 'administrativeaction' as defined in PAJA, direct recourse to s 33of the Constitution appears to be possible. Section33 of the Constitution does not define 'administra-tive action' (on which see the judgment of OlivierJA in Transnet Ltd v Goodman Brothers (Pty) Ltd2001 (1) SA 853 (SCA) (2001 (2) BCLR 176) inpara [30]: '(c)onsistent with the object of theadministrative law, the essential characteristics ofthe concept of administrative action are seen asthe exercise of a public (ie governmental) functionby a public authority or official affecting the rightsof or legitimate expectations of or involving legalconsequences to the individual').

There appears to be merit in the applicants' con-tention that PAJA is not and cannot be exhaustiveof the right to administrative justice. To hold other-wise would be subversive of the principle of con-stitutional supremacy." (at para 15)

In New Clicks, however, it was held that the lawcannot be allowed to diverge into two separatestreams of administrative law jurisprudence,one under PAJA and the other under theConstitution. There is only one system ofadministrative law, and that is founded on sec-tion 33 of the Constitution. PAJA was enactedto give practical effect to the rights of section33, and the rights in section 33 cannot beaccessed except through reliance on PAJA. Tohold, as Malan J did, that PAJA confers a nar-rower range of administrative justice rights thansection 33 implies that PAJA is unconstitution-al. This may be the case; but in the absence ofa challenge and a finding to that effect, it mustbe accepted that PAJA is co-extensive withsection 33. PAJA in this sense is exhaustive ofrights to administrative justice. The relevantpassages in New Clicks are the following:

"A litigant cannot avoid the provisions of PAJA bygoing behind it, and seeking to rely on section33(1) of the Constitution or the common law. Thatwould defeat the purpose of the Constitution inrequiring the rights contained in section 33 to begiven effect by means of national legislation." (perChaskalson CJ at para 95)

"In my view, there is considerable force in the viewexpressed in NAPTOSA [and Others v Minister ofEducation, Western Cape, and Others 2001 (2)SA 112 (C)]. Our Constitution contemplates a sin-

gle system of law which is shaped by theConstitution. To rely directly on section 33(1) of theConstitution and on common law when PAJA,which was enacted to give effect to section 33 isapplicable, is in my view inappropriate. It willencourage the development of two parallel sys-tems of law, one under PAJA and another undersection 33 and the common law. Yet this Court hasheld that there are not two systems of law regulat-ing administrative action - the common law andthe Constitution - 'but only one system of lawgrounded in the Constitution.'" (per Ngcobo J atpara 436, footnotes omitted)

Malan J's remarks were obiter in any case. Hedid find that the action complained against con-stituted administrative action in terms of sec-tion 1:

"In light of the constitutional and statutory frame-work, it follows that the decision to terminate thefunds constitutes 'administrative action' in that thedecision is one taken by an organ of State whenexercising a power in terms of the Constitution;exercising a public power or performing a publicfunction in terms of the Systems Act. In the publicservice employment context, it has been recog-nised that powers affecting the rights, property orlegitimate expectations of workers are subject toadministrative law." (at para 14)

The case was an application for interim reliefpending a full review application on the merits.The Judge held that at least some prospectsexisted and granted the relief - but the judg-ment offers neither reasoning nor a final orderon the merits and need not be considered fur-ther here.

Mzamba Taxi Owners' Association andAnother v Bizana Taxi Association andOthers 2006 (2) SA 154 (SCA) involved theuse of a taxi rank in Port Edward. The first tworespondents, voluntary taxi associations, hadconcluded an agreement to share the taxi rankin question. The fifth and sixth respondents, theKwaZulu-Natal Provincial Taxi Registrar andthe Eastern Cape Provincial Taxi Registrar,endorsed this agreement. The appellants, avoluntary not-for-gain taxi association and ataxi operator, challenged the endorsement asan irregular administrative act that, if imple-mented, would affect their members, mainlyfinancially (at paras 1-3). In the court below,McLaren J held that although the signing of theagreement by the fifth and sixth respondentsamounted to administrative action, the appli-cants had failed to prove on a balance of prob-

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abilities that their rights would be adverselyaffected by the agreement or that the endorse-ment of it had a direct, external legal effect (atpara 14). However, if the action did not have adirect, external legal effect and did not affectrights materially and adversely, that actionwould not meet the definitional requirements ofadministrative action in terms of PAJA.

The SCA held that while the appellants mayhave had a case for review in terms of the leg-islative framework governing the taxi industryin KwaZulu Natal (The Road Transportation Act56 of 1996 and the KwaZulu-Natal InterimMinibus Taxi Act 4 of 1998 and regulationspromulgated in terms thereof), they had notbrought their case on that basis. They couldhave argued, for example, that the public per-mits issued in terms of the Road TransportationAct allowing the first and second respondentsto operate minibus taxis had been issued irreg-ularly, or that the endorsement of the agree-ment by the fifth and sixth respondents was theresult of a "request" by the registrar to con-clude such an agreement in terms of regulation18(3) of the regulations. In the absence of chal-lenges of this nature, though, the SCA held thatthe appellants' challenge was misconceived.The SCA agreed with McLaren J that the appli-cation for review had to be dismissed, butmade it clear that the action challenged did notamount to administrative action:

"There was, therefore, no administrative action bythe fifth respondent in terms of the regulationbecause there was no decision that amounted tosuch action as defined in s 1 of PAJA. Theendorsement by the two registrars provided no fur-ther legal impetus to the agreement voluntarilyconcluded by Bambanani and BTA [the first andsecond respondents]. It did not confer the authori-ty to operate the route. That was already in placeby virtue of the public permits. There was thus noadministrative action by either registrar which wasopen to challenge by the appellants, either interms of PAJA or otherwise.

To prevent BTA members from using the PortEdward taxi rank would be to frustrate the rightsacquired by them in terms of the relevant permitsfrom the relevant road transportation boards,which are the primary regulators of minibus taxioperators. The regulatory statutes were neverintended to frustrate lawful competition. On thecontrary, they were designed to ensure safety, effi-ciency and lawful competition in the public inter-est." (at paras 28-29)

Law Society, Northern Provinces(Incorporated as The Law Society of TheTransvaal) v Maseka and Another 2005 (6)SA 372 (BH) concerned an application by theLaw Society of the Northern Provinces for amandamus against the first respondent com-pelling him to produce various records andbooks for inspection. The Law Society is autho-rised by section 70 of the Attorney's Act 53 of1979 to inspect an attorney's records for thepurposes of deciding if an enquiry in terms ofsection 71 should be held. The first respondentargued that the Law Society has an obligation,before deciding to hold an inspection, to affordattorneys - and the first respondent in this case- a hearing (at 378H-379C). The first respon-dent submitted in this regard that the actionstaken by the Law Society towards performingan inspection of his records amounted toadministrative action within the contemplationof section 1 of PAJA, and that he was thereforeentitled to procedural fairness in terms of sec-tion 3 of PAJA. The judge held, though, thatbecause an inspection would not have affectedmaterially the rights of the first respondent, itdid not constitute administrative action:

"For a decision or conduct to be classified asadministrative action and for a person to be enti-tled to the application of the principles of naturaljustice or to procedurally fair administrative action,the decision or conduct must at least materiallyand adversely affect that person's rights. See s3(1) of the PAJA and The Master v Deedat andOthers 2000 (3) SA 1076 (N) and Gamevest (Pty)Ltd v Regional Land Claims Commissioner,Northern Province and Mpumalanga, and Others2003 (1) SA 373 (SCA). Where the decision doesnot materially and adversely affect a person'srights it is not a decision in the administrative jus-tice sense. See Deedat's case (supra) at 1083G.Where a functionary merely performs an inves-tigative function which does not materially andadversely affect a person's rights, he or she neednot, unless a statute provides otherwise, observethe principles of natural justice. See Van derMerwe and Others v Slabbert NO and Others1998 (3) SA 613 (N) at 624D - E." (at 382B-E)

For this reason the first respondent's defencebased on PAJA had to fail.

In Phenithi v Minister of Education and oth-ers [2006] 1 All SA 601 (SCA) the appellant'semployment with the education department ofthe Free State was terminated as a result of theapplication of section 14(1) of the Employment

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of Educators Act 76 of 1998. That relevantparts of the section read:

"(1) An educator appointed in a permanentcapacity who-(a) is absent from work for a period

exceeding 14 consecutive days withoutpermission of the employer;

. . . shall, unless the employer directs otherwise, bedeemed to have been discharged from service onaccount of misconduct, in the circumstanceswhere-

(i) paragraph (a) or (b) is applicable,with effect from the day followingimmediately after the last day onwhich the educator was present atwork". (quoted at para 2).

For various reasons that need not be gone into,the appellant was absent from work for a peri-od of more than fourteen days without permis-sion from her employer. It was common causebetween the parties that she was dismissed"by operation of law" (at para 7), but it was theappellant's complaint that she had been dis-missed without the opportunity of a hearing.Her dismissal, she contended, offendedagainst principles of administrative justice, par-ticularly the audi alteram partem rule. The firstissue the court turned its attention to waswhether the dismissal of the appellant amount-ed to "administrative action". This is surely thecorrect approach: the appellant would onlyhave been entitled to procedural fairness andto demand a hearing if the action by which shewas dismissed was administrative action.Section 33 of the Constitution and PAJA conferthe right to procedurally fair administrativeaction. If the action was not administrativeaction properly defined, no complaint that prin-ciples of audi alteram partem had been violat-ed could be made. Mpati DP, for the court,relied on an earlier judgment of Van HeerdenJA dealing with comparable legislation to reachthis conclusion:

"Die beskouingsbepaling tree in werking indien 'npersoon soos die respondent (i) sonder dietoestemming van 'die Onderwyshoof' (ii) vir 'n tyd-perk van meer as 30 opeenvolgende dae van sydiens afwesig is. Of hierdie vereistes bevredig is,is objektief vasstelbaar. Indien 'n persoon sou aan-voer dat hy byvoorbeeld wel die nodige toestem-ming gehad het, en dit betwis word, is die feitelikedispuut deur 'n hof beregbaar. Daar is dan geensprake van 'n hersiening van 'n administratiewebesluit nie. Trouens, die al of nie inwerkingtredingvan die beskouingsbepaling is nie van enige

besluit afhanklik nie. Daar is dus geen ruimte nievir 'n beroep op die audi-reël wat in sy klassiekeformulering van toepassing is wanner 'n adminis-tratiewe - en diskresionêre - beslissing die regte,voorregte of vryheid van 'n persoon nadelig kanraak." (Minister van Onderwys en Kultuur enAndere v Louw 1995 (4) SA 383 (A) at 388G-H,translated and quoted by Mpati DP at para 9)

Holding that the case at hand and Louw's casewere comparable, Mpati DP concluded that theappellant's dismissal was not the consequenceof a discretionary decision, but merely the noti-fication of a result which occurred by operationof law (at para 9). Consequently, in theabsence of a "decision" and thus any "adminis-trative action" capable of review the appellant'sclaim had to fail.

The court noted that section 14(2) of theEmployment of Educators Act allows the rein-statement of an educator who has been dis-missed in terms of section 14(1). It is at thisstage that provision is made for a hearing. Thecourt stated, though, that since the provisionsof the section were not invoked it was not nec-essary to determine who should bear the onusof initiating such a hearing (at para 11). Thecourt also noted that the appellant had notmade an argument that the "decision" underreview was the employer's decision not to rein-state her. The court did not therefore considerthe argument.

Maleka v Health Professionals Council ofSA and Another [2005] 4 All SA 72 (E) (seealso sections 3 and 6 below) concerned theremoval from the register of private medicalpractitioners of a medical practitioner previous-ly licensed to practice as a private medicalpractitioner. The applicant had worked forsome time as a medical practitioner for theCiskei Department of Health until being issuedwith a licence to practice privately in 2001. Theregistrar of the Medical and Dental ProfessionsBoard, one of the boards of the first respon-dent, addressed a letter to the applicant inform-ing him that he had been erroneously regis-tered as a private medical practitioner as aresult of a "faulty IT-system action" (at para 2).The applicant's registration as a public healthpractitioner was resuscitated. The applicantcontended that the removal of his name fromthe register affected his rights adversely andwas thus administrative action in terms of sec-

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tion 1 of PAJA, and was conducted unfairly andshould be set aside.

The first respondent argued on the other handthat since the removal of the applicant's namefrom the register was simply the correction of acomputer error, it did not amount to administra-tive action in terms of PAJA ( at para 4). Thefirst respondent's case was that:

"[O]ne of the duties of the registrar of the firstrespondent, in terms of sections 18(1) and (2) ofthe Health Professions Act 56 of 1974, is to keepthe register of medical practitioners correctly,which implies the duty to correct inaccuracies. Theregistrar's case is that all that was done: hechanged the entries when he realised that therehad been a computer error. This, he argues wasnot administrative action. It was akin to correctinga clerical slip. The argument continues: adminis-trative action within the meaning of the [PAJA]would only be done, in relation to a case such asthe present, once the board had applied its mindto changing the registration of a medical practi-tioner whose name was on the register followingan application for its registration which had beenconsidered by the board; here the applicant'sname had not been placed on the register as aresult of an application to the board which hadbeen considered; it had got there by computererror; it could therefore be taken off by clerical cor-rection of the error." (at para 8).

Jones J found both factual and legal problemswith this argument. In the first place, he heldthat no evidence had been presented to thecourt on the nature of the clerical slip. Noexplanation was provided as what the faulty ITaction was or how it had occurred (at para 9).More fundamental, the judge went on, was thefact that a distinction must be drawn betweenclerical errors corrected before anyone's rightsare affected and the correction of the error inthis case. "As a result of the error", the judgestated, "the applicant was sent a card entitlinghim to practise as a private general practition-er" (at para 10). The judge concluded thereforethat altering this state of affairs amounted toadministrative action for purposes of PAJA:

"I have no doubt whatever that in these circum-stances the decision to cancel the applicant's reg-istration as a private practitioner and to reinstatehis registration as a public service general practi-tioner was administrative action. This, in the lan-guage of [PAJA] is any decision taken by a juristicperson when performing a public function in termsof an empowering provision of a statute whichadversely affects the rights of any person." (atpara 10)

Jones J then went on to hold that the fact thatthe applicant may not in fact have had a right toappear on the register of private practitionersdid not affect the conclusion that his rights hadbeen adversely affected. He held that he didnot have to "determine the substantive rights ofthe applicant in this application." Rather, hewas concerned with the process by which aright was taken away. The facts show, he con-cluded, that the applicant had a legitimateexpectation of notice of the removal of hisname and a hearing prior to that happening (atpara 11). Jones J's opinion here is that eventhough the applicant may not have properlybeen given a right to practise as a private prac-titioner in the first place, The fact was that hewas granted that right. The removal of that rightconstituted administrative action susceptible ofreview under PAJA. Moreover, section 3 ofPAJA entitles persons to fair administrativeaction where rights or legitimate expectationsare materially and adversely affected. Thiscase is therefore a good example of the defini-tional difficulties experienced in applying PAJA,since section 1 defines administrative action asaction affecting rights, while section 3 appliesexplicitly to action affecting rights or legitimateexpectations.

The applicants in Van Zyl and others vGovernment of RSA and Others [2005] 4 AllSA 96 (T) (see below under the doctrine oflegality) were natural and juristic personsinvolved in mining operations in the Kingdom ofLesotho. The applicants were all citizens ofSouth Africa or companies registered andincorporated in South Africa. The applicants'cause of action was that their property rights inLesotho were expropriated by the governmentof Lesotho for the purposes of the LesothoHighlands Water Project without the paymentof compensation. The applicants claimed thisviolated their constitutional rights under theSouth African Constitution, and sought protec-tion of those rights through diplomatic effortson the part of the South African government.The South African government chose not toengage the Lesotho government. It was thisdecision that the applicants sought to review.Patel J held, however, that executive actiondoes not constitute administrative action withinthe meaning of section 33 of the Constitution(at para 46). After describing the executivepowers sought to be reviewed, the judge wenton:

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"The nature of these powers and acts performedare essentially executive and not administrativeand, therefore, section 33 of the Constitution andconcomitantly the provisions of [PAJA] are not themechanisms of control regarding executive pow-ers." (at para 50)

Patel J noted that a number of considerationsare relevant to determining whether actions areexecutive or administrative in nature. Theseinclude the source of the power; the nature ofthe power; and its subject matter. The essentialquestion, in his view, is whether the powerinvolves the exercise of a public duty and if so,how closely that duty is related to policy mat-ters on the one hand - which are not adminis-trative - or the implementation of legislation onthe other - which is administrative. Patel J con-cluded that the powers to conduct, and thefunctions of conducting foreign diplomatic rela-tions are "by source, origin, nature and descrip-tion essentially executive powers and intrinsi-cally involved with foreign policy considera-tions" (at para 50). Patel J also remarked thatPAJA expressly excludes the executive powersof the President of the Republic from its ambit.Section 85 of the Constitution sets out the pow-ers of the President, and subsection (2)(e) con-fers on the President the power to perform "anyother executive function provided for in theConstitution or national legislation." The defini-tion of administrative action in section 1excludes the powers listed in section 85(2)(e)from review. Patel J saw the formulation andpursuit of foreign policy as a presidential powercovered by section 85(2)(e), and therefore heldthat PAJA did not apply to executive decisionsinvolving foreign policy.

The respondents' decision was therefore notsubject to review under the provisions of rightsto administrative justice, although the decisionnevertheless had to be taken within constitu-tional limits.

The case of Chairperson: Standing TenderCommittee and others v JFE SapelaElectronics (Pty) Ltd and others [2005] 4 AllSA 487 (SCA) (see below under section 3,section 1 of the Constitution - the doctrine oflegality and common-law review - delay) is anappeal from a decision of the High Court. Thatdecision was reported in the August andSeptember 2004 issue of the PAJA Newsletter(the case is reported as JFE Sapela

Electronics (Pty) Ltd & another v Chairperson:Standing Tender Committee & others [2004] 3All SA 715 (C)). The decision of the SCAupheld the High Court decision, but varied theorder in one respect. The case concerned anapplication seeking the review and settingaside of the award, by the Department ofPublic Works, of three tender contracts for therefurbishment of prisons to Nolitha Electricaland Construction (Pty) Ltd. The court, per ScottJA held: "It is well-established that a tenderprocess implemented by an organ of state is an'administrative action' within the meaning of[PAJA]" (at para 19).

Trend Finance (Pty) Ltd and another vCommissioner for SARS and another [2005]4 All SA 657 (C) (see section 3, section 6, sec-tion 5 and section 7 below) concerned theseizure by the Controller of Customs (CapeTown) of goods sought to be imported by theapplicants because they had failed to pay thecorrect duty amount. The applicants chal-lenged this as unfair administrative action interms of PAJA. Van Reenen J held, after refer-ring to Deacon v Controller of Customs andExcise 1999 (2) SA 905 (SE) and Henbase3392 (Pty) Ltd v Commissioner, South AfricanRevenue Service and Another 2002 (2) SA 180(T) that "the determination under considerationconstituted administrative action within themeaning thereof in PAJA and accordingly, hadto be procedurally fair if it were to pass muster"(at para 76).

The applicant and the first respondent inSebenza Forwarding & ShippingConsultancy (Pty) Ltd v Petroleum Oil andGas Corporation of SA (Pty) Ltd t/a Petro SAand Another 2006 (2) SA 52 (C) (see belowunder section 1 of the Constitution - the doc-trine of legality) were part to a contract in termsof which the applicant was to provide shippingand forwarding services to the first respondent,a wholly owned subsidiary of the state-ownedCEF (Pty) Ltd. The latter was created in termsof the Central Energy Fund Act 38 of 1977 tofinance and promote the state's oil or relatedenergy products programme. The secondrespondent was the Minister of Mineral andEnergy Affairs. The judgment is a judgment onan application to amend pleadings in order tobring a review against a decision of theMinister. The Minister opposed the amendmenton the ground that no triable issue was raised.

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In determining whether a triable issue wasraised, the judgment considers whether thedecision constitutes administrative action forthe purposes of PAJA.

The applicant requested the Minister to investi-gate alleged irregularities in the contract, and,when the Minister decided not to conduct a for-mal enquiry, sought to have that decisionreviewed. The question before the court there-fore, was whether the Minister's decision wasadministrative action for the purposes of sec-tion 1 of PAJA. In considering this question,though, Bozalek J noted that since the appli-cant had not originally sought the review andsought the review only on an amendment tothe papers, facts material to the determinationof the review were not before the court:

"Any final answer to these questions should ideal-ly be given by the Court seized with the review. Itis open to the Minister, if she considers that theamended relief sought has no foundation in eitherlaw or fact, to challenge the matter on the papers[as] they stand at the hearing of the main pro-ceedings. I agree with the applicant's counsel'ssubmissions that that court will be in the best posi-tion to determine the matter based on a completeconspectus of the facts on all the issues. I do notsee the question of the reviewability of theMinister's decision as purely a matter of law. Thequestions concerning whether the Minister's deci-sion falls within the bounds of the various defini-tions in the PAJA is properly determined in relationto all the facts of the matter which have not nec-essarily been placed before the Court. It would beunwise and unnecessary for this Court to seek toreach any final or firm conclusions on what may beincomplete facts. Each of these sub-questions canbe the subject of a detailed analysis given thevagueness of some of the concepts involved andthe various statutory definitions that come in toplay. In this regard the criticisms expressed byCora Hoexter of the statutory definition of adminis-trative action in the PAJA as 'parsimonious, unnec-essarily complicated and probably as unfriendly tousers as it is possible to be' are by no meansunfounded." (at para 21. The reference is to CoraHoexter, "'Administrative action' in the courts", apaper unpublished at the time, delivered at theComparative Administrative Justice Workshop,Cape Town 20-22 March 2005.)

Nevertheless, in order to determine whetherthe prayed for amendment raised a triableissue, the court considered whether theMinister's conduct might be administrativeaction in terms of PAJA. The judge noted thatthe outset of this investigation that a distinctionis to be drawn between reviewable administra-

tive action and non-reviewable executiveaction:

"This aspect of the enquiry boils down, in my viewto the question of whether the Minister's decisionwas executive action. In President of the Republicof South Africa and Others v South African RugbyFootball Union and Others the Court held that thedistinction between executive and administrativeaction came down to a distinction between theimplementation of legislation, which is administra-tive action, and the formulation of policy which isnot. Where this line is drawn, the Court stated fur-ther, will depend primarily upon the nature of thepower and also upon other relevant factors includ-ing the source and nature of the power, its subject-matter, whether it involves the exercise of a publicduty and whether it is related to policy matters orthe implementation of legislation". (at para 22,footnotes omitted)

The first point considered was whether theMinister exercised a public power in terms oflegislation in refusing to hold an inquiry. Thejudge held that if the Minister had decided toinstitute an inquiry she would have been exer-cising a public power in terms of section 1E(6)of the Central Energy Fund Act. It was at leastarguable, then, that the refusal to conduct suchan inquiry was a reviewable decision. The widedefinition of decision in PAJA as "doing orrefusing to do any other act or thing of anadministrative nature" makes it arguable thatthe Minister's refusal was administrative action(at para 26). Turning to whether the Minister'sdecision adversely affected the applicant'srights and had a direct, external legal effect,Bozalek J held that although the applicantcould not request an inquiry as of right, it wasat least possible that it had a right to a hearingbefore the Minister refused the request.

"Furthermore, at least in the sense that theMinister appears resolute in refusing to reconsiderher decision to launch any such enquiry (after con-sidering the applicant's side of the story), theMinister's decision has had a direct and actualimpact on the applicant's rights or interests. Thiseffect goes beyond a merely intra-departmentalimpact and in that sense the second leg of therequirement could be satisfied." (at para 28)

Holding that if PAJA was held to be applicable,the applicant would at least have a case thatthe decision had not complied with the require-ments of section 3 of PAJA, the judge grantedthe amendment.

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In Dunn v Minister of Defence and Others2006 (2) SA 107 (T) (see below under section6 and section 8) the applicant complained thatthe appointment of another person to the posi-tion as head of the newly-established anti-fraud division in the Department of Defencewas reviewable as administrative action interms of PAJA. Van Rooyen AJ agreed, andwent on to assess whether the applicant'srights to procedurally fair administrative actionhad been infringed in the process by which theother person, one Coetzee, had been appoint-ed. He held:

"The Minister's appointment of Coetzee to the postfalls within the definition of an 'administrativeaction' and of a 'decision' as contemplated in s 1of PAJA. The Minister is empowered, in terms of s11 of the Defence Act [42 of 2002], as well as theregulations promulgated in terms of s 87 thereof,to appoint officers in the SANDF. His acceptanceand approval of the second respondent's recom-mendation on 13 September 2002 to appointCoetzee constitutes a 'decision' as contemplatedin s 1 of PAJA. In appointing Coetzee the Ministerexercised a public power or function. The irregu-larity of the appointment of Coetzee has, accord-ing to Dunn and his counsel, Mr Dunn SC, materi-ally and adversely affected his rights and/or legiti-mate expectations and it has had - and still has - adirect legal effect on his interests. (at para 5)

Section 3 - Procedural fairness in admin-istrative action affecting individuals

In Maleka v Health Professionals Council ofSA and Another [2005] 4 All SA 72 (E) (seesection 1 above and section 6 below) the appli-cant was taken off the register of private med-ical practitioners by the registrar of the firstrespondent without prior notice or the opportu-nity to be heard prior to this happening. JonesJ held that this amounted to unfair administra-tive action (at para 11). Although Jones J didnot specifically mention the provisions of sec-tion 3, it is the case that section 3 provides thestatutory framework for the decision hereached. Section 3(2)(b)(i) and (ii) state thatfair administrative action requires an adminis-trator to give a person adequate notice of thenature and purpose of the proposed adminis-trative action and a reasonable opportunity tomake representations to the administrator.

In Chairperson: Standing TenderCommittee and others v JFE SapelaElectronics (Pty) Ltd and others [2005] 4 All

SA 487 (SCA) (see above under section 1 andbelow under section 1 of the Constitution - thedoctrine of legality and common-law review -delay), the award by the Department of PublicWorks of three tender contracts to NolithaElectrical and Construction (Pty) Ltd for therefurbishment of prisons was challenged bytwo unsuccessful tenderers. An initial assess-ment of Nolitha's tender, however, revealedthat it had not factored the cost of several itemsinto its tender price. This mis-calculation wasremedied at a later date, after the closing datefor submission of tenders. This, the unsuc-cessful tenderers argued, was in breach ofrequirements of procedural fairness.

The court began its review of procedural fair-ness by noting that what is fair in the adminis-trative process depends on the circumstancesof each case (at para 19, referring to section3(2)(a) of PAJA). The court went on:

"In the present case, what in effect occurred is thatNolitha's tender, with the latter's written consent,was adjusted by the reallocation of an amountover-quoted for one, or rather two items, to 'mostof the remaining maintenance items forInstallations A-P' for which Nolitha had under-quoted. The effect was apparently to convert atender from one regarded by the engineer asunbalanced and a financial risk to one which wasacceptable. But the offer made by Nolitha, asembodied in its tender, was not the one ultimatelyaccepted. What was accepted was in truth an offermade on 7 November 2003, some two monthsafter the closing date for tenders. In my view thiswas enough to strip the tender process of the ele-ment of fairness which requires the equal evalua-tion of tenders. It follows that the acceptance ofthe Nolitha tender and the award of the contractswere correctly held by the court a quo to bereviewable." (at para 19)

Trend Finance (Pty) Ltd and another vCommissioner for SARS and another [2005]4 All SA 657 (C) (see section 1 above, andsection 5, section 6 and section 7 below) con-cerned the seizure of a shipment of shoesimported by the first and second applicants bythe Commissioner for SARS and the CapeTown Controller of Customs (second respon-dent) for non-compliance with customs andduty requirements laid out in the Customs andExcise Act 91 of 1964. The applicants sought inprayer 1 of their notice of motion the reviewand setting aside of the respondents' decisionin terms of section 65(6) of the Customs andExcise Act. That section allows a person seek-

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ing to import goods to challenge the determi-nation of the value of the goods, upon whichdetermination duty payable is to be calculated.Van Reenen J found on the facts in this casethat the applicants had not succeeded in show-ing that the Controller had erred in finding thatthe actual value of the items to be importedwere higher than the value as contended bythe applicants, and using this higher value todetermine the duty fees payable (at para 65).The applicants sought review of the respon-dents' actions in the alternative on the basis ofPAJA (see prayer 2 at para 10). Van Reenen Jsummarised the argument as follows:

"The review of the determination is being soughton the following grounds:

Firstly, that the respondents did not follow a fairprocedure or afford the applicants a fair hearingbefore making the determination;

Secondly, in the alternative, that the respondentsdid not afford them a fair hearing before demand-ing payment of an amount equal to the valuethereof for duty purposes, namely R695 508; and

Thirdly, that the determination was arbitrary andcapricious as it was made on inadequate andinsubstantial grounds." (at para 73)

Van Reenen J disposed quickly of the thirdground. Having already found that the determi-nation was the product of an objectively verifi-able arithmetic calculation (at para 70), thejudge held that it could not be claimed that thedetermination of the quantum to be paid asduty was made on inadequate and insubstan-tial grounds (at para 74).

Turning to the first two grounds of challenge,the judge began by noting that the challengeraised the requirements of procedural fairnessset out in section 3of PAJA. It is to be noted inthis respect that the judge considered theapplication on this ground even though theapplicants "fell somewhat short" of the obliga-tion to identify clearly on which sections ofPAJA reliance is placed (at para 68). The judgestated:

"Content is given to the concept 'procedurally fairadministrative action' by section 3(2)(b) of PAJAwhich provides as follows:'(b) In order to give effect to the right to proce-

durally fair administrative action, an adminis-trator, subject to subsection (4), must give aperson referred to in subsection (1)-

(i) adequate notice of the nature and pur-pose of the proposed administrativeaction;

(ii) a reasonable opportunity to make rep-resentations;

(iii) a clear statement of the administrativeaction;

(iv) adequate notice of any right of reviewor internal appeal, where applicable;and

(v) adequate notice of the right to requestreasons in terms of section 5.'

Those five requirements, which are considered toconstitute the core elements of procedural fair-ness, may be departed from in the circumstancesset out section 3(4) which provides as follows:'(a) If it is reasonable and justifiable in the cir-

cumstances, an administrator may departfrom any of the requirements referred to insubsection (2).

(b) In determining whether a departure as con-templated in paragraph (a) is reasonableand justifiable, an administrator must takeinto account all relevant factors, including-(i) the objects of the empowering provi-

sion;(ii) the nature and purpose of, and the

need to take, the administrative action;(iii) the likely effect of the administrative

action;(iv) the urgency of taking the administrative

action or the urgency of the matter; and(v) the need to promote an efficient admin-

istration and good governance.'

Section 3(3) of PAJA provides that an administra-tor, in order to give effect to the right of procedu-rally fair administrative action, in his discretion,may give the person whose rights or legitimateexpectations are materially and adversely affectedthereby an opportunity to:'(a) obtain assistance and, in serious or complex

cases, legal representation;(b) present and dispute information and argu-

ments; and(c) appear in person.'

There is no evidence that the Controller, as dele-gate of the Commissioner, considered or wasrequired to consider the discretion reposed in himby sections 3(3) and (4)." (at paras 77-78).

The judge then set out the facts relevant to thedetermination of whether the applicants hadbeen subject to unfair administrative processes(at paras 80-81). He drew from this factualexposition that the Controller had failed to noti-fy the applicants the he was intending to exer-cise his discretion against the applicants, andfailed to afford them any opportunity to makerepresentations to the Controller prior to the

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exercise of that discretion. This, he concluded,"clearly offended against the mandatoryrequirements of subsections 3(2)(b)(i) and (ii)of PAJA" (at para 84).

Van Reenen J also considered the argumentthat the Controller had complied with the prin-ciples of procedural fairness after the actioncomplained against had been taken. He reliedon Nortjé en 'n ander v Minister vanKorrektiewe Dienste and andere 2001 (3) SA472 (SCA) for the proposition that "Althoughthe general rule is that natural justice must beobserved before a decision is taken, subse-quent compliance may suffice in exceptionalcircumstances" (at para 82). The judge reject-ed this argument, holding that no exceptionalcircumstances had justified such a course:

"[N]one of the considerations that are regarded assufficient to justify the subsequent compliance withthe requirements of just administrative action,such as urgency; impracticability because of thenumber of persons involved; the possibility thatprior compliance will defeat the purposes of theaction; and that the decision is merely provisionaland relevant to the enquiry whether the require-ments of procedural fairness have been compliedwith, are present in the communications enumer-ated in paragraph 81 above" (at para 82)

The failure to observe principles of proceduralfairness could not therefore be remedied afterthe administrative action was taken.

The case of Seodin Primary School and oth-ers v MEC of Education, Northern Cape andothers [2006] 1 All SA 154 (NC) (see belowunder section 6) concerned an application toset aside a decision by the first respondent thatschools in the Northern Cape area usingAfrikaans as the sole medium of instructionwould be converted to dual-medium Englishand Afrikaans schools. The applicants claimedthat the administrative action was procedurallyunfair because the first respondent had notcomplied with the principle of audi alterampartem before making the decision underreview. In assessing the factual material beforethe court in determining whether requirementsof section 3 of PAJA had been met, Kgomo JP(for a unanimous court) considered the stepstaken by the first respondent and the otherrespondents prior to the making of the deci-sion. "This exercise", the court stated,

"will go some way in answering the questionwhether or not the respondents observed the audialteram partem rule in making their decisions orwhether they went gung-ho to ride roughshod overthe rights of the applicant-schools." (at para 17)

After reviewing the communications and discus-sions between the parties (at para 18), the courtconcluded that there had been discussionsbetween the respondents and the applicantschools regarding the difficulties caused by sin-gle-medium schools and proposals to convertthese schools to dual-medium schools. Thecourt also noted that these discussions were notable to establish consensus between the partieson the way forward. The court stated:

"Several functionaries based at Head Office and inthe Kuruman region have deposed to the fact thatthere had been ongoing discussions and consulta-tions with all schools in an attempt to persuadethem to convert to dual-medium (English-Afrikaans) mode of instruction to cater for learnersfrom disadvantaged backgrounds to ease thepressure on the overcrowded schools and allevi-ate the over-stretched situation at English-mediumschools. The endeavours were without success."(at para 19).

It is to be noted in this respect that although thediscussions were without success, the princi-ples of audi alteram partem had been compliedwith: the principle requires only that partiesaffected by a decision be given an opportunityto present their point of view to the decision-maker; not that the decision-maker must adoptthat point of view. The court therefore rejectedthe argument that the respondents had actedin breach of section 3 of PAJA.

In Dunn v Minister of Defence and Others2006 (2) SA 107 (T) (see above under section1 and below under section 6 and section 8) theapplicant had applied for a position as the headof the newly-established anti-fraud division ofthe Department of Defence. Another person,one Coetzee (the fourth respondent), wasappointed in his place. Having held that thisappointment did indeed constitute administra-tive action in terms of PAJA (see above), VanRooyen AJ went on to hold that the applicantwas entitled to procedural fairness in theappointment process and to review of thatprocess where his rights to procedural fairnessare infringed. After an extensive review of thefacts (at paras 13-23). The judge stated:

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"Section 3(1) of PAJA requires that administrativeaction, which materially and adversely affects therights or legitimate expectations of any person,must be procedurally fair. The first question thatarises in this regard is: which of Dunn's rightsand/or legal expectations have been affected bythe respondents' conduct? It is common causethat Dunn applied for the post and that the Ministerdecided to appoint Coetzee in the post. Since therespondents, for the purpose of selecting a suit-able candidate, purportedly invoked the formalplacement process in the Interim Measures, thatdecision in itself gave Dunn certain rights. Thoserights were: the right to participate in the pre-scribed evaluation and selection process; the rightthat the procedure followed must be properlyapplied; the right to uniform treatment throughoutthe selection and evaluation process; the right thatfully motivated submissions containing 'HRrequirements and succession planning intentionsof all structure managers' had to be submitted toand placed before the seminar for consideration;the right that a 'prescribed person profile' of eachof the nominees should serve before the seminarand the right to be considered and evaluated forappointment by a formal seminar.

All these rights are granted in terms of the formalplacement process and form part and parcel ofDunn's right to procedurally fair administrativeaction in terms of s 33 of the Constitution, as wellas under s 3(1) of PAJA. The placement boardinvited Dunn to an interview. An attempt is madeex post facto in the reasons to try and avoid theconsequences thereof by stating that the invita-tions were only invitations to 'possible interviews'.

The procedure that was in fact followed, ie accord-ing to the reasons, deviated from both the formaland informal processes set out in the InterimMeasures and materially and adversely affectedDunn's aforementioned rights. As stated above,the decision of the Minister is based on a multi-phased process, comprising a nomination phase,an evaluation and selection phase and finally theappointment phase. During the crucial evaluationphase, Dunn was deprived of the opportunity toenjoy any of the benefits attached to his afore-mentioned rights. This failure constitutes proce-dural unfairness as contemplated in s 3 of PAJA.The deprivation of such opportunities cannot besaid to be immaterial. Self-evidently it also had anadverse effect on Dunn." (at paras 25-27)

Section 4 - Procedural fairness in admin-istrative action affecting the public

Chairpersons' Association v Minister ofArts and Culture and Others 2006 (2) SA 32(T) (see below under common-law review -ultra vires) concerned the process by which therespondents effected the name-change of the

town Louis Trichardt town to Makhado Town interms of section 10 of South AfricanGeographical Council Act 118 of 1998. Theapplicant's attack on the decision was basedon the argument that although section 10 of theAct did not expressly require the decision-maker to consult with the public, the nature ofthe action taken was such that consultationshould have occurred. It was further the appli-cant's argument that consultation did not occurand the decision should accordingly be setaside.

In responding to this argument counsel for therespondents submitted that because the appli-cant for the name change was a body consti-tuted by councillors elected by and represent-ing the people of the relevant geographicalarea, the first and second respondents couldnot have borne an obligation to consult. Thejudge, however, was "particularly unimpressedwith this submission":

"Whilst the Act may not specifically state consulta-tion as a requirement, the subject-matter, being thechange of a town name, is a national and sensitivematter. Because of the nature of the subject-matter,I do not think, first, that the first respondent could orwould have been expected to take such a decisionwithout considering the issue of consultation.Secondly, in my view the same should be applica-ble when the application is laid before the secondrespondent for recommendation. Lastly, one wouldexpect, at least that the first respondent be satisfiedthat consultation was conducted. Whilst the coun-cillors of the third respondent might have beenelected into office by the people, on a national issuelike the change of name of a town, one wouldexpect them to consider the sensitivity of the matterand to revert to those who had elected them intooffice for a proper mandate." (at para 23)

In this regard the judge considered provisionsof section 4 of PAJA, holding that although anadministrator taking administrative actionaffecting the public is entitled to decide on thesteps to be taken to ensure procedural fair-ness, the provisions of the Act in this caserequired some sort of participation by theaffected community:

"I may well add that in terms of s 4(1) of [PAJA]where an administrative action adversely affectsthe rights of the public, an administrator, being thefirst respondent in the instant case, in order to giveeffect to the right to procedurally fair administrativeaction, must decide, amongst other things,whether to hold a public inquiry in terms of ss 2 orto follow a notice and comment procedure in terms

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of ss (3) or where the administrator is empoweredby any enabling provision to follow a procedurewhich is fair but different, to follow that procedure.However, because of the nature of the matter, inmy view, the first respondent and correctly so,considered consultation. In a way, ss (3) and (4) ofs 10 envisage some sort of participation by inter-ested or aggrieved parties." (at para 24)

On the facts of this case, which need not be tra-versed here, the judge concluded that there hadbeen substantial compliance with the obligationto consult, and that the application to reviewand set aside the decision effecting the namechange accordingly had to fail (at para 37).

Section 5 - Reasons

Section 5(3) of PAJA established a presump-tion in favour of persons subject to administra-tive action. It states that where an administra-tor fails to furnish adequate reasons for anadministrative action it must be presumed inthe absence of proof to the contrary, that theadministrative action was taken without goodreason. This provision was considered by VanReenen J in Trend Finance (Pty) Ltd andanother v Commissioner for SARS andanother [2005] 4 All SA 657 (C) (see aboveunder section 1 and section 3, and below undersection 6 and section 7). The applicants in thecase had made provisional payments to reme-dy deficiencies in duty fees for goods they wereseeking to import into South Africa. During thecourse of the dispute between the parties, theapplicants' attorneys wrote to the respondentsdemanding the refund of the provisional pay-ments, and in a subsequent letter demandingthat written reasons be furnished in terms ofsection 5(2) of PAJA for the decision not torefund the amounts. Van Reenen J held thatalthough the failure to provide written reasonsusually leads presumptively to the conclusionthat the decision was taken without good rea-son, the presumption does not operate wherethe decision complained against is impugnedon grounds not related to administrative jus-tice. The judge stated:

"However, as the basis on which the applicantsclaimed to be entitled to a refund of the provision-al payments is unrelated to any violation of theirright to fair administrative action, the presumptionin section 5(3) of PAJA is not of any assistance tothem." (at para 98)

Section 6 - Grounds of review

In Maleka v Health Professionals Council ofSA and Another [2005] 4 All SA 72 (E) (seesections 1 and 6 above) Jones J held that sec-tion 6 allows courts to review administrativeaction on the grounds set out in PAJA. Thisstatement was made in the context of answer-ing a defence that the court did not have juris-diction to hear the case; but it is to be notedthat section 6(2)(c) allows review of adminis-trative action when it is procedurally unfair. Thefact that the administrative action in this casewas held to be unfair, therefore vested thecourt with jurisdiction to hear the matter. Thedefence relied on common-law grounds ofjurisdiction, but in holding that PAJA vested thecourt with jurisdiction Jones J held that PAJAsuperseded the common-law rules relating toreview jurisdiction (at para 12, relying on DeVille, Judicial review of administrative action inSouth Africa Butterworths, 2003 at 3). Jones Jstated in this regard: "In my view the intentionof [PAJA] is to give wide, not restricted, protec-tion against unfair administrative action, whichimplies greater, not more restricted, jurisdic-tion." (at para 13)

In Hlaneki and others v Commission onRestitution of Land Rights and others[2006] 1 All SA 633 (LCC) a decision of therespondents rejecting the applicants' claim forrestitution of land in terms of the Restitution ofLand Rights Act 22 of 1994 was set aside on anumber of grounds in section 6 of PAJA. Theapplicants' land claim was rejected by therespondents for the reasons that the claim didnot meet the requirements of a number of sec-tions of the Restitution of Land Rights Act.These reasons (at para 2) were that 1. The first applicant, Chief Hlaneki, had him-

self submitted the land claim on behalf of anumber of people under his authority as atraditional leader without the necessarymandate. This was in breach of section10(3) of the Restitution Act.

2. The land subject to the claim was never-theless still being occupied by theclaimants. No dispossession as required bysection 2 of the Restitution Act had thusoccurred.

3. The claim was rejected as "frivolous andvexatious" in terms of section 11(3) of theRestitution Act.

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4. Notice of the claim was not published in theGovernment Gazette as required by section11(1) of the Restitution Act (the court didnot, however, deal directly with this lastpoint in the judgment, no further commentwill be made in this regard here).

Considering the first of these, Moloto J notedthat although section 10(3) of the RestitutionAct requires a "resolution or document" in sup-port of a contention that a claimant representsa group of people,

"[i]t is a well-known fact, which this Court can takejudicial notice of, that chiefs act as representativesof their tribes. A document showing that the firstapplicant acts on behalf of the third applicant byvirtue of the powers and jurisdiction he has overthe third applicant is sufficient proof of this repre-sentative capacity without necessarily necessitat-ing a special resolution authorising him to lodgethe claim." (at para 8)

The judge found that the respondents' "high-handed" approach in finding against the appli-cants on the basis of non-compliance with sec-tion 10(3) was incorrect. He found that theapplicants had complied with section 10(3),and held that the decision in this regard wasreviewable in terms of sections 6(2)(d), (e)(iii)and (iv) and (f)(ii) of PAJA ( at para 13).

Turning to section 2 of the Restitution Act, therespondents rejected the claim since the appli-cants were still occupying the land claimed.There could thus be no dispossession in termsof section 2. Moloto J held, however, that thedefinition of "dispossession" is wide enough toinclude the right to tenure security (at para 18).The decision was thus reviewable on thegrounds set out in section 6(2)(d), (e)(iii) and(f)(ii) of PAJA (at para 26).

The respondents argued that the applicants'claim was frivolous and vexatious because theclaim had little merit. In describing the appli-cant's claim, counsel for the respondent usedterms like "patently bogus", "without sub-stance", patently devoid of any merits orprospects of success", "ill-advised" and "falla-cious" (at para 28). However, Moloto J pointedout that once the claim was found to have com-plied with the statutory requirements of theRestitution Act, the argument that the claimhad no merit was substantially weakened (atpara 27). Instead, it had to be recognised that

the applicants in seeking to vindicate a consti-tutional right, had followed the statutorily pre-scribed procedures and were entitled to aninvestigation of their claim in a fair, objectiveand responsible manner (at para 30). Such anapplication cannot be considered frivolous orvexatious, and an investigation of such a claimis required whatever the prospects of success.The judge therefore found the respondents'decision to be flawed and reviewable on thebasis of section 6(2)(d), (e)(ii), (iii), (v), (vi),(f)(ii) and (h). The respondents' decision wastherefore set aside and remitted for reconsider-ation.

In Dunn v Minister of Defence and Others2006 (2) SA 107 (T) (see above under section1 and section 3, and below under section 8)also, the court found that administrative actionof the respondents was reviewable under arange of provisions of section 6(2). It is moreconvenient to approach the court's findings asa whole rather than to consider the challengesunder each ground of review listed in section6(2). The grounds on which the court didreview the administrative action concernedwere section 6(2)(a)(i), (b), (c), (f)(i) and (i).

The facts of the case are briefly that the appli-cant, Dunn, was not appointed to a post in theDepartment of Defence for which he hadapplied. The fourth respondent, one Coetzee,was appointed instead. The appointmentprocess, it appears from the judgment, is setout in two documents: the "SMS-DODI" (thesecond part of this acronym stands for"Department of Defence Instruction; but it is notclear what the first part stands for. The docu-ment nevertheless has to do with the selectionof senior management in the Department); andthe Interim Measures for the appointment oftop officers, approved by the second and thirdrespondents on 1 July 2002. However, sincethe decision appointing Coetzee was ultimate-ly taken by the Minister, the action was taken interms of the Defence Act 42 of 2002 readtogether with the General Regulations for theSouth African Defence Force and the Reserve.Read together, this framework sets out the fol-lowing requirements for the appointment ofapplicants to, for example, the position at issuein this case:1. Applicants are entitled to a hearing before a

formal seminar.

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2. A "placement board" must be convened toconsider each application. It must be con-vened in terms of the empowering provi-sions found in the Interim Measures.

3. The placement board's selection proce-dures were unfair in terms of the InterimMeasures for the following reasons:

"Dunn did not have the opportunity of appearingbefore the placement board. Given the fact thatthis was a new post and the difference of opinionon the separate placement board, Dunn was, tomy mind, entitled to have been granted an inter-view. This did not happen. In fact, he was led tobelieve that an interview was to take place but, inthe mean time, Coetzee had already been recom-mended for appointment. Mr Moosa argued thatDunn and Coetzee were so close that an appoint-ment could have been made at the flip of a coin.From this contention it would seem to follow thatan interview would not have assisted Dunn orCoetzee. However, it is this very alleged equalitywhich, to my mind, contributed to making an inter-view imperative." (at para 28(4))

Van Rooyen AJ ultimately held that the first,second and third respondents, in not comply-ing with the mandatory provisions of the leg-islative and regulative framework for theappointment of senior officers, had actedunfairly in the procedures by which theyappointed Coetzee over the applicant. Thejudge relied on comments of the ConstitutionalCourt and the SCA in prefacing his final evalu-ation of the evidence:

"The rule of law is a founding value of ourConstitution. All organs of State are bound by it. InPharmaceutical Manufacturers Association of SAand Another: In re Ex parte President of theRepublic of South Africa and Others 2000 (2) SA674 (CC) (2000 (3) BCLR 241) at para [17]Chaskalson P (now CJ) states that the exercise ofpublic power is regulated by the Constitution: 'Oneof the constitutional controls referred to is thatflowing from the doctrine of legality.' PAJA reflectsthe same values. The importance for an organ ofState of acting within the powers granted isemphasised by Navsa JA in Gerber and Others vMember of the Executive Council of Developmentand Planning and Local Government, Gautengand Another [2003 (2) SA 344 (SCA)]:

'[34] It is abundantly clear . . . that the counciland the MEC failed to properly appreciate theirfunctions and powers. The Council cannot beheard to say that the wrong reference to legis-lation is cured by the fact that it has originalpowers to impose property rates. The questionis whether it had the power to act in the man-ner complained of and to impose the rates inquestion. See Administrateur, Transvaal v

Quid Pro Quo Eiendomsmaatskappy (Edms)Bpk 1977 (4) SA 829 (A) at 841A - G andMinister of Education v Harris 2001 (4) SA1297 (CC) para [17] . . . .

[35] The Republic of South Africa is a constitu-tional State. Local authorities and other Stateinstitutions may act only in accordance withpowers conferred on them by law. This is theprinciple of legality, an incident of the rule of law.See Fedsure Life Assurance v GreaterJohannesburg Transitional Metropolitan Counciland Others 1999 (1) SA 374 (CC) (1998 (12)BCLR 1458) at para [56]. . . . See alsoPharmaceutical Manufacturers Association ofSA and Another: In re Ex parte President of theRepublic of South Africa and Others 2000 (2)SA 674 (CC) (2000 (3) BCLR 241) para [17]. . . .'"(at para 39, footnotes omitted)

The judge therefore concluded that the respon-dents' action could be reviewed for the follow-ing grounds found in section 6(2) (at para 40):1. Section 6(2)(a)(i): The placement board

was convened following an instruction fromthe second and third respondents. It wasnot convened in terms of the empoweringprovisions, found in the Interim Measures.The placement board's selection and rec-ommendation of Coetzee was therefore notauthorised by the empowering legislativeframework

2. Section 6(2)(b): The provisions of theInterim Measures are mandatory: non-com-pliance with them is grounds for review. Theplacement board was not properly con-vened in terms of these mandatory require-ments, and mandatory provisions werethereby not complied with.

3. Section 6(2)(c): The applicant was invitedto an interview, but that interview was sub-sequently cancelled because Coetzee hadalready been selected by the placementboard. This is in itself procedurally unfair;but more so in the circumstances of thiscase where the placement board was divid-ed on the question of whether the applicantor Coetzee should be recommended to theMinister for appointment.

4. Section 6(2)(f)(i): Because the mandatoryprovisions of the Interim Measures werenot complied with, and the InterimMeasures make room for no other proce-dure, the procedure actually followed wasnot authorised by the empowering provi-sions.

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5. Section 6(2)(i): Relying on South AfricanNational Defence Force v Minister ofDefence 1999 20 ILJ 2265 (CC), the judgeheld that the action taken was "otherwiseunconstitutional or unlawful" in that it violat-ed rights to fair labour practices.

The judge concluded ultimately that the actionwas reviewable in terms of section 6 of PAJA,and went on to consider the applicant's prayerfor compensation in terms of section 8(1) ofPAJA (see below).

Section 6(2)(c) - procedural fairness

Trend Finance (Pty) Ltd and another vCommissioner for SARS and another [2005]4 All SA 657 (C) (see above under section 1,section 3 and section 5, and below under sec-tion 7) concerned an application to reviewadministrative action taken by the Controller ofCustoms. Cape Town, on the authority of theCommissioner for SARS. Van Reenen J sum-marised the applicants' complaints against theController's actions (at para 73, quoted abovesection 3) and then stated:

"The first and second grounds undoubtedly fallwithin the compass of section 6(2)(c) of PAJAwhich provides that a court has the power to judi-cially review administrative action if it was proce-durally unfair." (at para 75)

Van Reenen J then proceeded to review andset aside the action taken by the Controller onthe grounds that it was not procedurally fair.

Section 6(2)(d) - error of law

The applicant sought the review of a decisionof the first respondent in Jicama 17 (Pty) Ltdv West Coast District Municipality 2006 (1)SA 116 (C) on the basis that it had been influ-enced by an error of law. The court agreed withthis attack and the granted the application toset the decision aside, but did so, in a sensesummarily, because the first respondent did notseek to defend the reason it had originallygiven for the decision. The applicant tenderedsuccessfully for a contract to collect arrearmunicipal service council levies and to attendto the registration of levy payers on behalf ofthe first respondent. After the first respondenthad informed the applicant that it had beenawarded the tender, it cancelled the award and

issued a statement re-advertising the tenderbecause the "requirement of functionality" hadnot been specified in the original tender. Theapplicant contended that the first respondent'scancellation of the contract for this reason wasthe result of its misunderstanding of the leg-islative framework set up by the PreferentialProcurement Policy Framework Act 5 of 2000and the Debt Collectors Act 114 of 1998. Incourt, however, the first respondent made noattempt to defend its decision to cancel thecontract on the basis that the requirement offunctionality should have been specified in theoriginal tender document. Instead, it raised fivenew grounds of defence which, if accepted bythe court, would constitute significant unfair-ness for the applicant:

"Another reason the first respondent should not beallowed to supplement the reasons for its decisionby reasons which were clearly taken ex post factois that if it was allowed to do so, it would in effectbe converting the applicant's application forreview, which is being brought on narrow grounds,into a full-scale review of its own decision. Thiswould be palpably unfair and in any event wouldbe defective for the tender documents of the othertenderers are not before the Court." (at para 12)

Having upheld the review on this basis, CleaverJ nevertheless considered the merit of thedefences raised by the first respondent. He heldthat there was no merit in these submissions.

Section 6(2)(e)(ii) and (v) -decisionstaken in bad faith or for ulterior purposes

In Seodin Primary School and others v MECof Education, Northern Cape and others[2006] 1 All South Africa 154 (NC) (see aboveunder section 3 and below under common-lawreview - delay) the applicants challenged adecision of the first respondent to convert sin-gle-medium Afrikaans language schools todual-medium Afrikaans/English languageschools. Although not framed explicitly in termsof section 6(2)(e) of PAJA, the applicantsclaimed that the respondents had acted in badfaith and that the decision had been motivatedby an ulterior motive (at paras 5.3.1 and 13).PAJA makes provision for the review of admin-istrative action on both these grounds is sub-sections 6(2)(e)(ii) and (v). The ulterior motivebehind the decision, the applicants alleged,was the "forced racial integration of the appli-cant schools which the MEC perceive[d] to be

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a relic of apartheid and 'lily-white'." (at para 13).They based this allegation primarily on extractsfrom the budget speech given by the MEC on1 May 2004. The relevant excerpt of thespeech is quoted in the judgment at para 15,and it is true that the excerpt laments the racialexclusivity of certain schools in the NorthernCape, and does indeed describe these schoolsas "lily-white". The excerpt even contains state-ments that accuse schools of deliberatelyerecting policies designed to retain the racialexclusivity of the schools. The first commentmade by the court is that if this is indeed so,there is certainly no problem with attempting toremedy the situation (at para 16). The desire toremedy that undesirable situation can hardlybe described as an ulterior motive. The appli-cants argued however that the decision wasnot aimed only at remedying an undesirablesituation but at subverting Afrikaans culture.The court responded to this deeper allegationby noting that the excerpt relied on by theapplicants cannot be seen in isolation:

"In order to make a pronouncement on the aver-ment that the respondents has nothing but theforced racial-integration and the obliteration ofAfrikaans and the cultural ethos of the applicant-schools as their objective, it is necessary for anexamination of what the respondents did pursuantto the MEC's budget speech and what informationwas ostensibly available to him and hisDepartment. The MEC, as we have noted, did notstart on a clean canvas. He says he had regard towhat his predecessor had done." (at para 17)

Referring to the facts of the case and applyingto them the principles set out inPharmaceutical Manufacturers if South Africa:In re Ex parte President of the RSA 2000 (2)South Africa 674 (CC) at paras 82-86, KgomoJP held for that court that he could discern noevidence of mala fides or an ulterior motive inwhat the MEC or his functionaries had done (atpara 20).

Section 6(2)(e)(iv) - decisions takenbecause of the unauthorised or unwar-ranted dictates of another person or body

The applicant in Lazarides v Chairman of theFirearms Appeal Board and others [2006] 1All SA 396 (T) was refused a license to pos-sess a certain rifle, a .50 calibre BrowningMusgrave. He approached the court seeking toreview the decision, and argued that PAJA gov-

erned the proceedings (at 402b-c). The appli-cant was a recognised collector of firearms,and owned a collection of 73 firearms. The rea-son given for the refusal of his application inrespect of the Musgrave rifle by the CentralFirearms Registry was "insufficient/lack ofmotivation and the firearm does not fit into yourcollection" (at 398b). The Firearms AppealBoard agreed (at 398g-i).

In correspondence that passed between theparties subsequently the respondent indicatedto the applicant that the Deputy Minister forSafety and Security had in 2002 taken a policydecision that civilians should not be allowed tobe in possession of rifles such as the .50 cali-bre Musgrave because it has an effectiverange of 1200m and is capable of piercing40mm armour (at 399b). The applicant arguedthat in terms of the applicable legislation onlythe Minister, by the promulgation of regula-tions, or Parliament could outlaw possession ofspecific firearms (at 399d).

The judgment does not specifically refer to sec-tion 6(2)(e)(iv) of PAJA. Nor does it describethis challenge as a collateral challenge. A col-lateral challenge is made where a person sub-ject to administrative action challenges theframework within which the administrativeaction was taken. It seems that the applicant'schallenge would fit under either of these head-ings. If the reason for the respondent's decisionwas a rule that was established unlawfully, thenthere do appear to be grounds for setting itaside, either on the basis of a collateral chal-lenge or section 6(2)(e)(iv) of PAJA. Ismail AJsuggests that investigating the lawfulness ofthe rule would have amounted to an interfer-ence in the domain of the administrator that thecourt was not competent to perform (at 399h-400h). The ratio for the rejection of this argu-ment, however, was the finding that therespondent had not relied on the rule - whetherestablished unlawfully or not. After reiteratingthe reasons communicated to the applicant bythe Central Firearms registry for the refusal ofthe license, Ismail AJ held:

"The refusal of the licence to the applicant was notbased on the firearm being statutorily prohibited toindividuals nor that the applicant was considered aperson who was a threat or danger to the Republicof South Africa. The refusal was due to the abovereasons." (at 401h-i)

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Section 6(2)(e)(vi) - decisions takenarbitrarily or capriciously

In Lazarides v Chairman of the FirearmsAppeal Board and others [2006] 1 All SA 396(T) the applicant argued that the refusal of afirearms license by the respondent was anarbitrary and capricious decision because, as afirearms collector, he had already been granteda license to possess a firearm very similar tothe one for which the application in this casewas made (at 399e). The judge set out theapplicant's argument:

"Mr Snyman [applicant's counsel] submitted thatthe refusal did not make sense particularly in viewof the fifth respondent approving and granting alicence for the .55 anti-tank rifle which was morepowerful that the firearm applied for. This sugges-tion that the applicant was granted a more power-ful firearm than the one applied for in my viewdoes not hold any credence. On this logic it wouldimply that the Commissioner therefore is dutybound to issue every licence the applicant wouldapply for in view of him having been given alicence for a greater calibre firearm. Logic andcommon sense suggest that the Commissionermust apply his discretion to each and every appli-cation made a by a person whether that personapplies for a license for his first gun or 74thlicense. The fact that a license was granted for anautomatic weapon does not mean that theCommissioner must issue a licence where a per-son apples for his next or subsequent automaticweapon licence. If this were the criterion then theCommissioner once he has issued more than onelicence to an applicant would merely be rubberstamping subsequent applications to possessfirearms. In doing so he would not be applying hisdiscretion and this in itself would be an irregularityor a possible dereliction of his duty." (at 400i-401c)

Section 6(2)(f)(ii) - review for rationality

Radio Pretoria (geregistreer ooreenkomstigartikel 21 van die Maatskappywet van SAvan 1973 soos gewysig) v Voorsitter van dieOnafhanklike Kmmunikasie-owerheid vanSA en 'n ander [2006] 1 All SA 143 (T) (seebelow under section 8 - remedies) concernedan application by a non-profit organisation tothe Independent Communications Authority ofSouth Africa (ICASA, or OKOSA in Afrikaans)for a four-year community radio broadcastinglicence. ICASA is authorised by national legis-lation to issue broadcasting licences. Theapplicant, Radio Pretoria, sough to have

ICASA's decision refusing their application fora broadcasting license reviewed and set aside.ICASA gave four reasons for the refusal of thelicense. First, it found that the board of RadioPretoria had not been democratically chosenfrom among members of the target audience inthe broadcast area as required by section32(4) of the Broadcasting Act 4 of 1999.Second, ICASA found that Radio Pretoria hadnot taken any steps towards ensuring thatmembers of its policy-making structures wererepresentative of the community which it wouldserve. Third, Radio Pretoria was found not tohave made any effort to ensure that its supportand management staff was representative ofthe racial and gender demographics of thecommunity it would serve. Fourth, ICASAfound that the broadcast interests that RadioPretoria sought to serve were already met byother radio stations, and in particular RadioSonder Grense (at 146h-147c).

In assessing these reasons, Smit J said that itwas important to bear in mind the principlesagainst which the reviewability of administra-tive actions must be determined. He relied hereon comments by Howie P in TrinityBroadcasting (Ciskei) v IndependentBroadcasting Authority of South Africa 2004 (3)SA 346 (SCA):

"In requiring reasonable administrative action, theConstitution does not, in my view, intend that suchaction must, in review proceedings, be testedagainst the reasonableness of the merits of theaction in the same way as in an appeal. In otherwords, it is not required that the action must besubstantively reasonable, in that sense, in order towithstand review. Apart from that being too high athreshold, it would mean that all administrativeaction would be liable to correction on review ifobjectively assessed as substantively unreason-able: cf Bel Porto School Governing Body andOthers v Premier, Western Cape, and Another. Asmade clear in Bel Porto, the review threshold isrationality. Again, the test is an objective one, itbeing immaterial if the functionary acted in thebelief, in good faith, that the action was rational.Rationality is, as has been shown above, one ofthe criteria now laid down in s 6(2)(f)(ii) of thePromotion of Administrative Justice Act.Reasonableness can, of course, be a relevant fac-tor, but only where the question is whether theaction is so unreasonable that no reasonable per-son would have resorted to it (see s 6(2)(h)). . . . .In the application of that test, the reviewing Courtwill ask: is there a rational objective basis justify-ing the connection made by the administrative

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decision-maker between the material made avail-able and the conclusion arrived at?"(at paras 20-21, footnotes omitted, quoted by Smit J at 147f-h)

Applying these comments to the present mat-ter, Smit J said:

"By 'n toepassing van die beginsel in die onder-hawige saak moet die vraag dus gestel word ofdaar 'n rasionele objektiewe basis bestaan wat dieverbintenis gemaak deur Okasa tussen die feitetot sy beskikking en die gevolgtrekking waartoegekom is, regvaardig." (at 147i-148a)

The judge was not able to identify a rationalbasis for ICASA's decision, and could not seea rational link between the reasons given forthe decision and the decision itself. He held:

"Hoe Okosa 'n verbintenis kan maak tussenhierdie feite and die gevolgtrekking waartoegekom is, is vir my onverklaarbaar. Daar is na mymening geen rasionele objektiewe basis waaropso 'n gevolgtrekking ooit gemaak kan word nie.Die vereiste van rasionaliteit vereis tog immers datdaar in ooreenstemming met rede en ten volleuitrekenbaar opgetree word. Hierdie gevol-gtrekking waartoe Okosa gekom het dat daar nievoldoende rede bestaan vir die diens wat appli-cant wil aanbied is, na my mening, geheel an alirrasioneel. Die feite toon immers onteenseglikaan dat daar 'n aansienlike groep luisteraarsbestaan, inagnemende hul kulturele agtergrond,hul ouderdom en hul regmatige voorkeure, watverkies en, myns insiens geregtig is om te vereisdat daar aan hul voorkeure oor 'n radiostasiegehoor gegee word en dat die invloede van anderradiostasies nie teen hul sin in hul kele afgedrukword nie." (at 148f-h)

Smit J concluded that there was no rationalbasis for ICASA's finding that there was no com-munity interest and therefore no need for theapplicant's proposed radio programming. Therefusal of a broadcast licence could be reviewedand set aside on this basis (at 148h-i).

Section 6(2)(g) - failure to take a deci-sion

In Vumazonke v MEC for SocialDevelopment, Eastern Cape, and three sim-ilar cases 2005 (6) SA 229 (SE) (see intro-ductory comments to this Newsletter) the appli-cants in four cases sought orders compellingthe respondent to take a decision in respect oftheir applications for disability grants. In thefirst of these, Ms Vumazonke discovered forthe first time after filing her papers that her

application had been refused three years pre-viously. The respondent, however, did notrespond to her initial letter of demand and fur-nished her with the official letter refusing herapplication only after she had filed papers incourt. She was for this reason entitled toreceive her costs from the respondent. PlasketJ also held that the 90-day period within whichshe could appeal this decision in terms of theSocial Assistance Act 59 of 1992 and its regu-lations began to run only from the date onwhich she was informed of and given reasonsfor the decision. Since she had not yet beengiven reasons, that period had not yet begun torun and Plasket J held she could appeal thedecision at any time. (at paras 31-33)

The applicants in the other cases similarlysought review of the respondent's action interms of section 6(2)(g) for her failure to take adecision. Plasket J referred in this regard tosection 6(3)(a) of PAJA which sets out morefully the grounds upon which the failure to takea decision can be reviewed. The subsectionreads:

"If any person relies on the ground of reviewreferred to in subsection (2)(g), he or she may inrespect of a failure to take a decision, where-(a) (i) an administrator has a duty to take a

decision;(ii) there is no law that prescribes a period

within which the administrator isrequired to take that decision; and

(iii) the administrator has failed to take thatdecision,

institute proceedings in a court or tribunal for judi-cial review of the failure to take the decision on theground that there has been unreasonable delay intaking the decision".

Plasket J noted that the respondent or mem-bers of her department do indeed bear a dutyto take a decision and that the failure to take adecision in this case had persisted over anunreasonable period:

"In the present cases, the respondent or dulyempowered officials in her department have a dutyto take decisions in respect of the applicants'applications for disability grants. No law prescribesa time period within which such decisions have tobe taken and those decisions have not beentaken. In my view, there has, in these circum-stances, been an unreasonable delay in taking thedecisions. On the department's own terms, threemonths was the period within which it undertook totake the decisions. When consideration is given tothis fact, the nature of the discretion to be exer-

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cised, the limited amount of information uponwhich the decisions would be based and the factthat most of the information is contained in theapplications themselves, any delay beyond threemonths is unreasonable in the absence of specialcircumstances. It has, accordingly, been estab-lished that the applicants have established theground of review envisaged by s 6(2)(g) of thePAJA. The applicants are consequently entitled toappropriate relief for this infringement of their fun-damental right to lawful administrative action." (atpara 39, footnotes omitted)

Section 6(2)(h) - review for reasonable-ness

In Compass Waste Services (Pty) Ltd vNorthern Cape Tender Board and others[2005] 4 All SA 425 (NC) (see below undercommon-law review - delay) the NorthernCape Department of Health prepared tenderspecifications which the Northern Cape TenderBoard - the first respondent - was to use inawarding a contract for waste removal servic-es. The court in this case dismissed the appli-cation on the ground that it was moot (seebelow), but considered the arguments relatedto the tender specifications. The tender specifi-cations drawn up by the Department of Healthrequired waste to be disposed of by incinera-tion. The applicant's tender, however, pro-posed that waste would be disposed by anoth-er method (autoclaving). Counsel for therespondents therefore submitted that the appli-cant's tender failed to meet the tender specifi-cations, and the Tender Board was correct toaward the contract to a different tenderer (atpara 13).

Counsel for the applicant argued that theTender Board was not bound to the tenderspecifications set by the Department and thefact that the applicant's proposed method ofdisposal was not incineration should not havebeen fatal to its tender (at para 15). The argu-ment ultimately came down to a claim that inadhering to the Department's preferred methodof incineration, the tender Board had actedunreasonably. In dealing with this argument thecourt, per Lacock J, held that the question waswhether the Tender Board's decision to adhereto the tender specifications was "one that areasonable decision-maker could not reach"?(at para 16, referring to Bato Star Fishing (Pty)Ltd v Minister of Environmental Affairs andTourism 2004 (4) SA 490 (CC) at 512H-513D).

The court characterised the test for unreason-ableness in administrative decisions as follows:

"The test is not whether this Court disagrees withthe approach of the board, but rather whether theaction of the Board was within its statutory powerand whether it, viewed objectively, acted rationallyor reasonably." At para 16.3)

Applying this test to the facts of the case, thecourt continued:

"To have been guided by the Department in regardto its requirements is, to my mind, not unreason-able. By accepting that the Department wouldknow best what is required, is not unreasonable.By accepting that incineration was a tried and test-ed method of healthcare waste disposal, known tothe Northern Cape Department of Health, is notunreasonable. To have been hesitant to introducean unknown and more recent method of waste dis-posal, is not unreasonable." (at para 16)

Because the tender was not in accordance withthe tender specifications, and because theTender board had not acted unreasonably inadhering to the tender specifications, the courtheld that the application for review had to fail.

The case of Foodcorp (Pty) Ltd v DeputyDirector-General: Department ofEnvironmental Affairs and Tourism: BranchMarine and Coastal Management and others[2006] 1 All SA 277 (C) (2006 (2) SA 199 (C))has had an interesting history before ourcourts. The applicant is a company carrying oncommercial fishing operations. It was awardedfishing rights for the 2002-05 seasons forpelagic fish; but dissatisfied with the tonnage offish allocated to it, it approached the Cape HighCourt seeking the review of the allocation(Foodcorp (Pty) Ltd v Deputy Director-General:Department of Environmental Affairs andTourism: Branch Marine and CoastalManagement and others 2004 (5) SA 91 (C).This decision is reported in the April-July 2004issue of the PAJA Newsletter). The Cape HighCourt dismissed the application, but that judg-ment was overturned on appeal and the allo-cation set aside by the SCA on the groundsthat it was unreasonable (Foodcorp (Pty) Ltd vDeputy Director-General: Department ofEnvironmental Affairs and Tourism: BranchMarine and Coastal Management and others[2005] 1 All SA 531 (SCA) - reported in theOctober 2004-May 2005 edition of the PAJANewsletter). The respondent was directed to

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consider the matter afresh and re-determinethe tonnage that might be caught by the appli-cant. The decision that resulted from this freshprocess, however, turned out to be little differ-ent from the allocation that was originally com-plained against. For this reason alone, counselfor the applicant submitted that the decisionshould be set aside on the basis that it isunreasonable (at 282e-f). The respondentscountered, firstly, that the 2002 allocations hadbeen made under a different policy regime (at283b-c) and second, that the SCA judgment inrespect of the previous allocation had consid-ered only the results of the decision-makingprocess and not the reasons and justificationsfor the decisions (at 285d-e). Davis J rejectedboth of these arguments. Although the chal-lenge to the decision raised a number of provi-sions of PAJA - section 6(2)(e)(iii) and (vi), (f)(ii)and (h), the judgment is most appropriatelyconsidered under the heading of reasonable-ness.

Davis J began his assessment of the merits ofthe case by reiterating the caveat posted by theConstitutional Court in Bato Star Fishing (Pty)Ltd v Minister of Environmental Affairs andTourism and Others 2004 (4) SA 490 (CC):

"If we are satisfied that the Chief Director did takeinto account all the factors, struck a reasonableequilibrium between them and selected reason-able means to pursue the identified legislative goalin the light of the facts before him, the applicantcannot succeed. The task of allocation of fishingquotas is a difficult one, intimately connected withcomplex policy decisions and requires ongoingsupervision and management of that process bythe departmental decision-makers who areexperts in the field." (at para 50, quoted by DavisJ at 287e)

Davis J held that this case is not a case whereit could be said that the administrator has strucka reasonable balance or that the court shouldrefrain from interfering in the discretionary deci-sions of an administrator. He stated:

"In the present dispute, the interference by a courtrequired by applicant does not breach the principlepf separation of powers. It is for the executiveand/or Legislature to craft policy and for the exec-utive to seek the most appropriate manner inwhich to implement such policy. However, policyneeds to be implemented within the framework ofour constitutional system. To the extent that theimplementation of policy is irrational, inexplicableand unreasonable, a court must interfere to hold

the executive accountable to proper compliancewith the values of the Constitution; irrationality,inexplicability and unreasonableness (as definedin PAJA and interpreted in Bato Star at paragraphs44-45) are three qualities which a decision cannotembrace if it is to be valid in a constitutional state.For this reason, the general position is that thesecond respondent is entitled to formulate andimplement a policy for the allocation of valuablefishing rights and the courts should respect thisrole and their lack of institutional equipment todecide policy matters which relate to allocation ofresources.

In the present dispute, however, the results pro-duced by the application of the formula developedby Prof Butterworth on behalf of the first ad secondrespondent has produced results, (marginal differ-ences from the earlier application notwithstanding)which appear to be no less irrational, inexplicableand unreasonable than those which were consid-ered by the SCA.

On [counsel for the respondents]'s own testgleaned from the data of Harms JA [in] the SCAjudgment, the results produced are not justifiable.Whether the formula or the information fed into theformula is the cause of the result produced is notthe issue upon which a decision can be madebased on these papers. The resultsproduced…are so similar to those which were thesubject of the first case that, based on the reason-ing employed in that case, the legal consequencesof an application of section 6(2)(h) of PAJA mustbe the same." (at 287h-288d)

Section 6(2)(i) - action otherwise uncon-stitutional or unlawful

The judgment in Kemp NO v Van Wyk 2005 (6)SA 519 (SCA) did not deal with the provisionsof PAJA explicitly. The comments made, how-ever, are usefully considered under this head-ing: classified under the common-law groundsfor review, the complaint was that the decision-maker had failed to apply his mind to the issuebefore him and had not properly considered theappellant's application. This common-lawground could be captured under section6(2)(e)(iii) or (vi), or even (h) - but the generali-ty of the challenge in this case is such that itwould fit most comfortably into subsection (2)(i).

The case involved an application by the appel-lant to import animals into South Africa fromZimbabwe. The Animal Diseases Act 35 of1984 prohibits the importation of animals intoSouth Africa without a permit issued by the

23

Director of Animal Health (the first respondentinto the country in this case). The appellant hadmade an unsuccessful application to import 98Sable antelope, and approached the PretoriaHigh Court to review the refusal of his applica-tion (at para 2). Material to the case is the factthat about a year before the appellant madethe application, the Directorate of AnimalHealth took the policy decision to place anabsolute embargo on the importation of ani-mals to the country from Zimbabwe, becausemeasures to control foot-and-mouth disease inthat country had broken down (at para 3). Theappellant's argument was essentially that inlight of the existence of the embargo, therespondent had failed to consider the appel-lant's application on its merits. The applicationwas thus not properly evaluated and therespondent's failure to properly consider theapplication before refusing it was unlawful as aresult. The court considered and responded tothe appellant's argument:

"It was submitted that the first respondent'sreliance upon the existence of the embargo inmaking his decision excluded the proper exerciseof his discretion and for that reason he actedunlawfully. What he was required to do, so it wassubmitted, was to consider the proposals thatwere put forward by the appellants, in isolation ofthe existing embargo, and to refuse the applicationonly if those proposals were demonstrably inade-quate to obviate the risk of the disease being intro-duced. I do not think that is correct. That wouldsuggest that the first respondent's function waslimited to adjudicating upon the adequacy of pre-ventative measures that were proposed by poten-tial importers, and that he was not entitled to initi-ate, and then enforce, preventative measuresdevised by himself, which is manifestly not so.. . . .If the decision to impose the embargo was itselflawful (and there is no suggestion that it was not), Ido not think the first respondent was called upon(though it was open for him to do so) to re-evaluateits imposition merely because he was presentedwith an alternative proposal that might have beenequally effective. He was entitled to evaluate theapplication in the light of the directorate's existingpolicy and, provided that he was independently sat-isfied that the policy was appropriate to the particu-lar case, and did not consider it to be a rule to whichhe was bound, I do not think it can be said that hefailed to exercise his discretion." (at para 10)

Nugent JA, for the court, began his judgmentby setting out the principles of administrativelaw applicable when a decision is made in thelight of a policy decided upon by an organ ofthe executive:

"A public official who is vested with a discretionmust exercise it with an open mind but not neces-sarily a mind that is untrammelled by existing prin-ciples or policy. In some cases, the enablingstatute may require that to be done, eitherexpressly or by implication from the nature of theparticular discretion, but, generally, there can beno objection to an official exercising a discretion inaccordance with an existing policy if he or she isindependently satisfied that the policy is appropri-ate to the circumstances of the particular case.What is required is only that he or she does notelevate principles or policies into rules that areconsidered to be binding with the result that nodiscretion is exercised at all. Those principlesemerge from the decision of this Court in Brittenand Others v Pope 1916 AD 150 and remain appli-cable today." (at para 1).

In light of these views, the appeal was dis-missed.

Section 7 - Procedure for review

In Trend Finance (Pty) Ltd and another vCommissioner for SARS and another [2005]4 All SA 657 (C) (see above section 3, section5 and section 6) the respondents opposed therelief sought in terms of PAJA on the groundsthat the applicants had failed to exhaust internalremedies as required by section 7(2)(a). Thechallenge was based on an allegation that theController for Customs, Cape Town (acting onthe authority of the Commissioner for SARS)had erred in charging a certain amount of dutyfees on goods the applicants were seeking toimport into South Africa. The judge, VanReenen J, dealt with this argument as follows:

The respondents; counsel contended that thisCourt could not entertain granting prayer 2,because the first applicant had failed to complywith the provisions of section 7(2)(a) of PAJAwhich preclude a court from reviewing administra-tive action thereunder unless nay internal remedyprovided for 'in any other law' has first beenexhausted. They identified section 93(2) of theCustoms [and Excise Act 91 of 1964] as such aremedy. The said subsection provides as follows:

'The Commissioner may, on good causeshown mitigate or remit any penalty incurredunder this Act on such conditions as theCommissioner may determine.'

In my view, all that sub-section does is to confer adiscretionary power on the Commissioner. It doesnot prescribe a specific remedy which anaggrieved party is obliged to invoke. Accordingly,such a party's choice of remedies remains unim-paired. The respondents' counsel, in my view cor-rectly, did not identify the appeal procedurereferred to in section 77B(1) of the Customs Act as

24

such a remedy as it clearly is merely a permittedalternative to the institution of proceedings eg areview. In the circumstances I incline to the viewthat the applicants are not precluded from seekingthe relief claimed in prayer 2 of the notice ofmotion." (at para 69)

Nichol and another v Registrar of PensionFunds and others [2006] 1 All SA 589 (SCA)also concerned the application of section 7(2)(a)of PAJA. The first appellant had been a memberof the Sage Schachat Pension Fund until it wasmerged with two other pension funds in 1998.The basis of the first appellant's complaint wasthat he and other members of the fund had notbeen consulted prior to the merger of the funds.Since the Sage Schachat fund was a smallerfund and in a more favourable surplus positionthan either of the other funds, the merger wasprejudicial to his interests. The Sage Schachatfund surplus would "effectively be diluted by thecross-subsidisation of the other funds" (at para4). Although the appellants did not mentionPAJA in any of their papers, it was commoncause between the parties that PAJA wouldapply (at para 8). The respondents argued thatthe application for review was rightly dismissedby the court a quo because the appellants hadnot exhausted all internal remedies as requiredby section 7(2)(a) of PAJA before approachingthe court for relief: section 26 of the FinancialServices Board Act 97 of 1990 establishes theFinancial Services Appeal Board and regulatesthe circumstances under which parties mayappeal against a decision in terms of the Act.Comparing the provisions of section 7(2)(a) tothe common-law position, Van Heerden JA said:

"Under the common law, the mere existence of aninternal remedy was not, by itself, sufficient todefer access to judicial review until the remedyhad been exhausted. Judicial review would in gen-eral only be deferred where the relevant statutoryor contractual provision, properly construed,required that the internal remedies first beexhausted. However, as pointed out by Iain Currieand Jonathan Klaaren [in The Promotion ofAdministrative Justice Act Benchbook at 182], 'byimposing a strict duty to exhaust domestic reme-dies, [PAJA] has considerably reformed the com-mon law', It is now compulsory for the aggrievedparty in all cases to exhaust the relevant internalremedies unless exempted from doing so by wayof a successful application under section 7(2)(c).Moreover, the person seeking exemption mustsatisfy the court of two matters: first, that there areexceptional circumstances and second, that it isthe interests of justice that the exemption begiven. (at para 15, footnotes omitted)

In considering the circumstances alleged bythe appellant to be exceptional, the judgenoted that a strong case on the merits, withoutmore, does not constitute exceptional circum-stances (at para 24). The appellant in this casehad not relied on any facts other than thosegoing to the merits of his case to allege excep-tional circumstances. The court was not able tofind exceptional circumstances for the purpos-es of section 7(2)(c), nor could it find that it wasin the interests of justice for the court to deter-mine the merits. The appeal was accordinglydismissed.

Section 8 - Remedies

In Foodcorp (Pty) Ltd v Deputy Director-General: Department of EnvironmentalAffairs and Tourism: Branch Marine andCoastal Management and others [2006] 1 AllSA 277 (C) (see above under section 6) thecourt was seized with an application seekingthe review and setting aside of a decision verysimilar to a decision taken by the same bodyinvolving the same applicant already set asidein a previous judgment. For this reason thecourt was urged to exercise the power con-ferred on it in section 8(i)(c)(ii) of PAJA andsubstitute the respondents' decision with itsown. Despite recognising that there wereindeed exceptional circumstance that mightjustify such a course the court declined to fol-low it, since its decision might affect otherrights-holders involved prejudicially. Davis Jheld:

"I have arrived at this conclusion reluctantlybecause this is the second time in which the allo-cation by first and second respondent has beenfound to have been unreasonable. However, giventhe polycentric nature of this task, prudence andthe limits of institutional competence dictate thatthis Court should not assume the role of a fish allo-cater." (at 289a-b)

In Radio Pretoria (geregistreer ooreenkom-stig artikel 21 van die Maatskappywet vanSA van 1973 soos gewysig) v Voorsitter vandie Onafhanklike Kmmunikasie-owerheidvan SA en 'n ander [2006] 1 All SA 143 (T)(see above under section 6), the applicantsought the review and setting aside of the firstrespondent's decision to refuse an applicationfor a four-year community radio broadcastinglicence. The applicant also prayed in its noticeof motion that the court exercise its discretion

25

and make the decision it argued the firstrespondent should have made. The judgedeclined to do so, holding that a court of reviewwill only adopt this course in exceptional cir-cumstances:

"Slegs in uitsonderlike gevalle waar 'n beslissingter syde gestel is, soos op gronde van vooroordeelof erge onbevoegdheid aan die kant van die oor-spronklike besluitnemer, sal die hersieningshof syeie diskresie uitoefen om die aangevraagde bevelte verleen." (at 152d)

Although the judge did not refer explicitly tosection 8 of PAJA in this regard, his commentsmirror the position as set out in section8(1)(c)(ii)(aa) of PAJA.

By contrast, the applicant in Dunn v Ministerof Defence and Others 2006 (2) SA 107 (T)(see above under section 1, section 3 and sec-tion 6) was successful in his claim for excep-tional relief in terms of section 8. The case con-cerned a challenge to the process by whichone Coetzee, the fourth respondent, had beenappointed to a post in the Department ofDefence for which the applicant had applied.Having held that the irregularities in theprocess were so serious and fundamental thatthey had to be regarded as fatal to the pro-ceedings in which they occurred, Van RooyenAJ continued that it would not be in the inter-ests of justice that the appointment of Coetzeebe set aside (at para 42). Section 8(1)(c)(ii)(bb)allows a court of review to direct the adminis-trator who takes a reviewable decision to paycompensation to the aggrieved party in excep-tional circumstances. The judge saw the fol-lowing factors as relevant in his conclusion thatthe case presented exceptional circumstances:

"The absence of respect for imperative procedure;the insouciance displayed towards mandatorydepartmental policy and procedure; the secretivemanner in which Coetzee's selection and appoint-ment took place; the selective manner in which therecord was furnished; the disingenuous explana-tion for not proceeding with the interview to whichDunn was invited after the matter had alreadybeen decided upon; the various versions profferedfor the procedure that was followed and the con-flict between such versions and the documentspertaining to them; the prejudice which Dunn suf-fered." (at para 43)

The crisp reason for ordering the respondentsto pay compensation to the applicant, however,

was that there was no other relief available tohim: he was the victim of procedurally unfairand unlawful administrative action, where itwould be contrary to the interests of justice forthat administrative action to be set aside andremitted to the administrator or reconsideredby the court itself (in terms of section8(1)(c)(ii)(aa)). Compensation was the onlymeans by which the applicant's rights could bevindicated.

Section 1 of the Constitution - the doc-trine of legality

In Van Zyl and others v Government of RSAand others [2005] 4 All SA 96 (T) (see aboveunder section 1) the applicants sought thereview and setting aside of a decision by theSouth African government not to engage indiplomatic relations with the government ofLesotho in order to protect the applicants' prop-erty rights and interests in that country. Thefacts and principles raised by the case are setout by Patel J:

"The applicants requested the second respondentto afford diplomatic protection to them. Therequest was for the second respondent, in hisexecutive capacity as the President to take diplo-matic action on behalf of the Republic of SouthAfrica against the Kingdom of Lesotho. It wasargued by Mr Dugard that the President was undera duty towards the applicants on the basis allegedby them to extend 'effective' diplomatic protec-tion…. The President dispatched a Note Verbal tothe GoL [government of Lesotho] drawing itsattention to the applicants' claim and in doing sohe adopted a nuanced approach upon having con-sidered the applicants' request and reacted appro-priately. The government has a broad andextremely wide discretion, and how best to provideand in what form diplomatic protection it can offer.The choices and considerations open to thePresident were and are within the exclusivepurview of foreign relations between the firstrespondent and the GoL. The exercise of the dis-cretion is invariably influenced by political andeconomic considerations rather than the legalmerits of the particular claim." (at para 44, refer-ring to Kaunda and Others v President of the RSAand Others 2005 (4) SA 235 (CC))

MISCELLANEOUS

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The limits of the decision-making power heldby the respondents in this case, are neverthe-less set by the Constitution. Patel J held thatthe extent to which a court could interfere in theexercise of the respondents' discretion in thisregard was determined by the following con-siderations:

"First, it [the executive] must not infringe any pro-vision in the Bill of Rights and secondly, it is clear-ly constrained by the principles of legality andthirdly,

'…it is implicit in the Constitution, the Presidentmust act in good faith and must not miscon-strue the powers.'" (at para 51, quotingPresident of the Republic of SA v South AfricanRugby Football Union 2000 (1 SA 1 (CC))

Patel J noted that there may be instanceswhere the Constitution and the Bill of Rights donot provide for effective review of state actions,and that this will be the case where "the deci-sion does not limit any fundamental rights andis concerned primarily with the conduct of for-eign relations" (at para 54). The only basis forreview, Patel J went on, lies in the principle oflegality and the rule of law. In this case andcases like it, there is an extremely limited basisfor review, since the courts "cannot assume therole of a super-executive in matters that arepeculiarly and exclusively within the domain ofthe executive" (at para 57). Relying heavily onthe Constitutional Court's decision in theKaunda matter, Patel J concluded that therespondents' decision was rational in the cir-cumstances, and could not be set aside asinconsistent with the principle of the rule of law:

"[H]aving regard to the applicable policy consider-ations…the respondents rationally determinedthat they could not accede to the applicants'request for diplomatic protection as of right.Therefore, none of the grounds upon which theapplicants seek to have the decisions of therespondents set aside as prayed for…and in seek-ing a declarator…can be sustained." (at para 70).

In Chairperson: Standing TenderCommittee and others v JFE SapelaElectronics (Pty) Ltd and others [2005] 4 AllSA 487 (SCA) (see above under section 1 andsection 3) the Department of Public Worksawarded three contracts for the refurbishmentof prisons to Nolitha Electrical andConstruction (Pty) Ltd, the second appellant.The award of the contracts was challenged byJFE Sapela Electronics (Pty) Ltd (the first

respondent) and JFE Power Distribution (Pty)Ltd t/a JFE Reticulation (the second respon-dent). The salient facts are that in respect of allthree contracts, Nolitha was able to offer a ten-der price substantially lower than competingtenders. This was due to certain assumptionson the part of Nolitha. The independent con-sultant assessing the tenders made this clearon two occasions. In regard to the tender pricequoted for part of the work in one of the pris-ons, the consultant stated:

"In our opinion the low rates are misleading or thetenderer used low rates to justify a low installationcost based on the speculation that electricalheaters will replace the entire steam installation."(at para 6)

"Abnormally low rates; lower than market relatedprices appear in Installation A - Hot waterGeneration Systems. Average price for this installa-tion is R194 000 (tenders 4 & 5) whilst Nolitha'sprice is R1 606. We are of the opinion that the rea-son for these low rates is due to the tenderer'sspeculation that some of these installations shall fallaway or be part of a different [Department of PublicWorks] contract in the near future." (at para 10)

The court, per Scott JA, had regard to therequirements of the Preferential ProcurementPolicy Framework Act 5 of 2000 ("PreferentialAct"). The Preferential Act sets out a system forthe assessment of tenders. The crucial part ofthe Preferential Act for this case is that in orderfor a tender to eligible for consideration it mustbe "an acceptable tender". This is defined insection 1 as "any tender which, in all respects,complies with the specifications and conditionsof tender as well as the tender document" (atpara 11). The court also noted that thePreferential Act is legislation contemplated insection 217 of the Constitution, which reads:

"(1) When an organ of state in the national,provincial or local sphere of government, orany other institution identified in national leg-islation, contracts for goods or services, itmust do so in accordance with a systemwhich is fair, equitable, transparent, compet-itive and cost-effective.

(2) Subsection (1) does not prevent the organsof state or institutions referred to in that sub-section from implementing a procurementpolicy providing for-(a) categories of preference in the alloca-

tion of contracts; and (b) the protection or advancement of per-

sons, or categories of persons, disad-vantaged by unfair discrimination.

27

(3) National legislation must prescribe a frame-work within which the policy referred to insubsection (2) must be implemented."

The court went on to hold that the definition of"acceptable tender" has to be interpretedagainst the background of the principles andvalues underlying section 217. This sectionrequires a system for procurement which is"fair, equitable, transparent, competitive andeffective". The court stated:

"In other words, whether 'the tender in all respectscomplies with the specifications and conditions oftender as set out in the contract documents' mustbe judged against these values. Merely becauseeach item is priced does not mean that there wasproper compliance. What the Preferential Act doesnot permit a tenderer to do is in effect omit from histender a whole section of the work itemised in thebill of schedules and required to be performed. Atenderer who is permitted to do this has an unfairadvantage over competing tenderers who basetheir tenders on the premise, inherent in the tenderdocuments, that all the work itemised in theschedule of quantities is to be performed. Whetherwork may later be omitted is of no consequence.What is imperative is that all tenderers tender forthe same thing. By tendering on the basis that cer-tain work will not be required a tenderer is able toreduce his price to the detriment of other tender-ers, and almost certainly also to the detriment ofthe public purse since he is likely to load otheritems to the detriment of the employer. Such a ten-der offends each of the core values which section217(1) of the Constitution seeks to uphold. Itwould not be a tender which is acceptable withinthe meaning of the Preferential Act." (at para 14)

The court concluded that awarding the contractto what is in effect an unacceptable tender wasin breach of the principle of legality:

"It is well established that the Legislature andexecutive in all spheres are constrained by theprinciple that they may exercise no power and per-form no function beyond those conferred on themby law. This is the doctrine of legality…. Theacceptance by an organ of state of a tender whichis not 'acceptable' within the meaning of thePreferential Act is therefore an invalid act and fallsto be set aside." (at para 11)

[NOTE: This decision could have beenreached had the court relied on section6(2)(f)(i) of PAJA.]

Sebenza Forwarding & ShippingConsultancy (Pty) Ltd v Petroleum Oil andGas Corporation of SA (Pty) Ltd t/a Petro SA

and Another 2006 (2) SA 52 (C) (see aboveunder section 1) was judgment on an applica-tion to amend pleadings. The facts appear inthe discussion of the case above. In consider-ing whether the applicant had a triable issue,and therefore whether the amendment shouldbe granted, the court considered whether adecision by the second respondent, theMinister of Mineral and Energy Affairs, wasreviewable. The alleged decision was the deci-sion not to institute an investigation in terms ofsection 1E(6) of the Central Energy Fund Act38 of 1977 into alleged irregularities the con-tract between the applicant and the firstrespondent. Bozalek J held that there was atleast a possibility that the decision would fit thedefinition of administrative action in section 1 ofPAJA. If he was wrong on this point, however,he held that the decision nonethelessremained subject to review as an exercise ofpublic power (at para 34, relying on Presidentof the Republic of South Africa and Others vSouth African Rugby Football Union andOthers 2000 (1) SA 1 (CC) and PharmaceuticalManufacturer Association of SA and Another:In re Ex parte President of the Republic ofSouth Africa and Others 2000 (2) SA 674(CC)). Bozalek J said:

"These cases, whilst observing a distinctionbetween matters which are administrative andexecutive in nature, hold nevertheless that thelabelling of a decision as 'executive' does not nec-essarily insulate it from judicial scrutiny. Theseremain exercises of political power which arereviewable if they fail to meet the standards oflegality or rationality. There are indications, more-over, that these standards are by no means anumerus clausus. In Kaunda and Others vPresident of the Republic of South Africa andOthers 2005 (4) SA 235 (CC) (2004 (10) BCLR1009) the Constitutional Court held, perChaskalson CJ, as follows (at para [80]):

'If government refuses to consider a legitimaterequest, or deals with it in bad faith or irra-tionally, a court could require government todeal with the matter properly. Rationality andbad faith are illustrations of grounds on whicha court may be persuaded to review a deci-sion. There may possibly be other grounds aswell and these illustrations should not beunderstood as a closed list.' (My emphasis.)

[35] Currie and De Waal [The Bill of RightsHandbook, 5 ed at 13] relying on the decision inPharmaceutical Manufacturers, state that:

'The rule of law therefore means more than thevalue neutral principle of legality. It also hasimplications for the content of law and govern-

28

ment conduct. In this regard it has both proce-dural and substantive components. The proce-dural component forbids arbitrary decision-making. Not only the executive, but Parliamentitself may not act capriciously or arbitrarily.'" (atparas 34-35, footnotes omitted)

An application for review would raise a triableissue in that a court seized with such an appli-cation would have to consider it on its merits.The amendment was therefore granted.

One final case deserves mention under thissection. In Micro Finance RegulatoryCouncil v AAA Investment (Pty) Ltd andAnother 2006 (1) SA 27 (SCA) (the High Courtcase from which this case was an appeal isreported in the October 2004-May 2005 editionof this Newsletter), the appellant appealedagainst a decision of the Pretoria High Court inwhich rules it had made in its function as thebody authorised to regulate the micro-lendingindustry had been set aside. While the HighCourt held that the appellant, in making theserules, was exercising a public power that there-fore had to conform to principles of administra-tive justice, the SCA held that the appellant israther to be seen as a private company autho-rised to regulate the activities of those whochoose to subject themselves to its authority. Itis therefore not exercising a public power - buta private one:

"The company is not, and does not purport to be,a public regulator with authority unilaterally toexercise powers over outside parties. It is a com-pany that conducts business as a private regulatorof lenders who choose to submit to its authority byagreement. In regulating micro-lenders who agreeto such regulation, it does not purport to be exer-cising legislative or other public powers thatrequire a constitutional or legislative source. It pur-ports only to regulate those who are willing to sub-mit to its regime and the source of its authority todo so is their consent." (at para 24)

The respondent appealed to the ConstitutionalCourt in May of this year. Judgment has beenreserved.

Common-law review - ultra vires

The first applicant in Hos+Med Medical AidScheme and Others v Kalipa and Others[2005] 4 All SA 208 (T) (see below under audialteram partem) was a medical aid schemeregistered in terms of the Medical Schemes Act

131 of 1998 ("MSA"). The second to seventhapplicants were trustees of the scheme. Theyhad been removed as trustees of the schemeby members of the scheme at an annual gen-eral meeting held on 13 August 2004. The firsteight respondents were elected as "interimtrustees" at the same AGM. The applicantschallenged the validity of the decision by whichthey were removed as trustees.

Sections 24(3)(a) and 24(6) of the MSA providethat members of the board of trustees of amedical aid scheme must be fit and proper per-sons to hold office as trustees. Section 29 ofthe MSA provides that the Registrar of MedicalSchemes shall not register a medical aidscheme unless provision is made in thescheme's rules for the appointment of a boardof trustees and the amendment of the rules inaccordance with section 31 of the MSA (atparas 19-20). Rule 17 of the medical aidscheme's rules in this case governed theappointment and removal of trustees. The rele-vant parts of the Rule 17 were as follows:

"17.11 A member of the Board of Trustees shallcease to hold office if…17.11.4 He is removed by the Court from

any office of trust on account ofmisconduct, or…

17.11.8 He is removed from office by theCouncil [for Medical Schemes]in terms of section 46 of the[MSA]." (quoted at para 22)

The second to seventh applicants were pur-portedly removed from office by the membersof the scheme at the AGM in August 2004. Atthe same meeting, the first to eighth respon-dents were purportedly elected as a newboard. This new board proceeded to approve anew rule for the medical aid scheme thatallowed members of the scheme to removetrustees from office by resolution (at para 33).The applicants' argument was therefore thatthe there was no provision empowering themembers of the scheme to remove the secondto seventh applicants from office as trustees,and that the resolution purportedly doing sowas ultra vires and unlawful (at para 29). PatelJ upheld this argument, agreeing that themembers did not have the power to removetrustees at an AGM by resolution (at para 31).The rules prevailing at the time of the AGMallowed the removal of trustees only on thegrounds set out in rule 17. These rules did not

29

allow removal by resolution. Further, the "newrules" purportedly adopted at the AGM had nei-ther been submitted to nor approved by theCouncil in terms of section 31 and were conse-quently not valid. In regard to the subsequentaction of the new board of trustees approvingthe new rule, he held:

"Mr Swart [for the applicants] rightly submitted thatthe respondents were aware of the illegality of theirconduct that they sought albeit invalidly to intro-duce a rule in the Scheme's rules entitling mem-bers at a general meeting to remove a member ofthe board of trustees. This was indeed an imper-missible and an unlawful conduct." (at para 35).

[NOTE: The judge in this case did not con-sider whether the challenged resolution bythe scheme's members fell within thepurview of PAJA. If it did, though, the reso-lution could have been impugned in termsof section 6(2)(f)(i).]

In Democratic Alliance Western Cape andothers v Western Cape Minister of LocalGovernment and another [2006] 1 All SA384 (C), the applicant challenged the invoca-tion by the first respondent of section 106(1)(b)of the Municipal Systems Act 32 of 2000. Thatsection allows an MEC to institute an investi-gation against a municipality or members of amunicipality if he or she has reason to believethat serious malpractice has occurred. Thesection reads:

"If an MEC has reason to believe that a municipal-ity in the province cannot or does not fulfil a statu-tory obligation binding on that municipality or thatmaladministration, fraud, corruption or any otherserious malpractice has occurred or is occurring ina municipality in the province, the MEC must-

. . . .(b) if the MEC considers it necessary, des-

ignate a person or persons to investigatethe matter."

The facts of the case are easily set out.Schedule 6B of the Constitution makes provi-sion for members of municipal councils tochange their party allegiance without losingtheir membership during a floor crossing win-dow of fourteen days in September. On the eveof this window in 2004, one Mr Carelse, at thattime a DA councillor, deposed to an affidavitalleging that he had been intimidated by theDA, allegedly in an attempt to discourage hisimminent defection to the ANC. The first

respondent then instituted an investigation intothe conduct of the applicant on the basis thatCarelse's allegations gave him reason tobelieve that the applicant was guilty of mal-practice. The question answered by the courtwas thus whether section 106(1)(b) had beenproperly invoked by the first respondent. MeerJ indicated that in terms of the subsection, rea-son to believe there has been malpractice is ajurisdictional fact conferring the power to insti-tute an investigation. Without such reason tobelieve, the MEC has no power to institute aninvestigation:

"In order for the provisions of section 106(1)(b) tohave been properly invoked, the first respondent,as the MEC or the member of the Western CapeProvincial Executive Council responsible for localgovernment in the province, must have had rea-son to believe that a serious malpractice hadoccurred or was occurring". (at para 24)

The judge also made it clear that "reason tobelieve" is an objective term to be assessedfrom the perspective a reasonable person inthe position of the decision-maker - the firstrespondent in this case:

"It is accepted that the test as to whether there is'reason to believe' is objectively determined andmust be constituted by facts giving rise to suchbelief. The belief itself must be rational or reason-able and whilst it has been recognised that thephrase 'reason to believe' places a much lighterburden of proof on an applicant than the phrasethe Court is satisfied, 'a blind belief, or a beliefbased on such information or hearsay evidence asa reasonable man ought or could not give cre-dence to, does not suffice." (at para 25, footnotesomitted. Meer J referred here to the cases ofLondon Estates (Pty) Ltd v Nair 1957 (3) SA 591(D); Minister of Law and Order and Others vHurley and Another 1986 (3) SA 568 (A); UnitedDemocratic Front and Another v Acting ChiefMagistrate, Johannesburg 1987 (1) SA 413 (W).)

On reviewing the facts of the matter Meer Jfound that it could not be said that objectivelyspeaking, a reasonable person in the positionof the MEC would have held the belief that seri-ous malpractice had been or was being com-mitted by the DA in the relevant municipality. Atmost, the judge held, it could be concluded thatsince Carelse had been facing disciplinary pro-ceedings by the DA and had been asked toresign his position in the DA, he had felt intim-idated (at para 40). Based on this conclusion ithad to be found that the jurisdictional fact for

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the exercise of the power in terms of section106(1)(b) had not been established, that theMEC was not authorised to act in terms of thatsection and that institution of the investigationin terms of the section was ultra vires andunlawful, and had to be set aside.

A similar argument was raised inChairpersons' Association v Minister ofArts and Culture and Others 2006 (2) SA 32(T) (see above under section 4). The respon-dents in this case effected the change of thename of the town Louis Trichardt to MakhadoTown, purportedly in terms of the South AfricanGeographical Council Act 118 of 1998. In termsof section 9(1)(d) of the Act, the secondrespondent - the Council - must recommendgeographical name changes to the first respon-dent. It is within the competence of the firstrespondent to approve and thereby effectthese changes. "In other words", Legodi J held,"for the first respondent to make a decisionunder section 10(1) there must have been arecommendation by the second respondentunder section 9(1)(d)" (at para 20). In this casethe applicant argued that there had been nosuch recommendation and that, in theabsence, thereof, the first respondent hadacted ultra vires and unlawfully in approvingthe name change.

On the papers the judge found that no recom-mendation had been made by the secondrespondent, but that a recommendation hadbeen made by the Director-General of theDepartment of Arts and Culture. It was submit-ted that such a recommendation could not sub-stitute a recommendation by the secondrespondent (at para 21). The judge, however,accepted that argument that the Act contem-plated certain functions of the second respon-dent being fulfilled by the Director-General:

"I was urged by counsel on behalf of the respon-dents to find that the Director-General's office is asecretarial office of the second respondent estab-lished in terms of s 6 of the Act. Subsection (1)thereof provides that the executive functions of thecouncil, ie the second respondent, must be per-formed by a section established by the Director-General in terms of the Public Service Act.Subsection (2)(a) provides that the functions of thesection are to perform the administrative and sec-retarial services. In my view therefore, theDirector-General would have carried out the man-date of the second respondent in submitting theapplications and expressing the mandate as he

did. I am satisfied that the second respondent didmake a recommendation to the first respondent inregard to the only name which was proposed inthe application forms by the third respondent." (atpara 22)

The court found that the first respondent wastherefore competent to approve the namechange.

In Minister of Trade and Industry of RSA vFarocean Marine (Pty) Ltd [2006] 1 All SA644 (C) the plaintiff sought repayment withinterest of an amount of R1 723 861 from thedefendant. The amount was paid to the defen-dant in terms of the General Export IncentiveScheme (GEIS), but as a result of allegedlyfraudulent representations made by the defen-dant to the plaintiff. The defendant raised aspecial plea of absence of locus standi indefence, arguing that in terms of the GEIS,only the Director-General of the Department ofTrade and Industry can institute action torecover amounts paid in terms of the GEIS.The defendant argued that the Minister wastherefore not authorised to institute action andhad acted ultra vires in doing so in this case.The fact that the defendant relied on the GEIS- a policy document - raised interesting ques-tions of administrative law for the court:

"It is conceded by the plaintiff that the GEISscheme as a policy document has pro tanto theforce and effect of legislation. This being so,defendant argues, it must be interpreted as if itwas a statute.

If one equates policy to a statute, then in interpret-ing the policy, the courts are enjoined to apply theprinciples of administrative law. In terms of thebasic principles of administrative law power mayonly be exercised by a person or body upon whomit is conferred by the enabling provision. BaxterLawrence Administrative Law at 426 states:

'Power is not conferred upon "the administra-tion" generally, and any power which is con-ferred may be exercised by the office holder orbody upon which it was conferred alone. Ifsomeone else purports to exercise the power,the latter's act is simply ultra vires and invalid.'

Following upon the above, defendant argues thatas the Minister is not referred to in clause 3.11 ofthe GEIS guidelines and all the power specificallydevolves upon the Director-General, the Ministerhas no locus standi to institute the action and itsfirst special plea to that effect must accordingly beupheld. (at paras 10-11)

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Waglay J held that although the GEIS lent itselfto the interpretation contended for by the appli-cant, responsibility for administering funds laywith the Department as a whole. Relying onadministrative law principles, he stated that theMinister, as the office ultimately responsible forthe Department, has the authority to institutelegal proceedings in this regard.

"Although the GEIS scheme has pro tanto theforce and effect of legislation, it is not legislation; itis implemented through guidelines directed at theDirector-General, who, at all times acts as an offi-cer of the Department. The Director-general initi-ates the investigation and determines whetherrecovery is necessary. Should the party concernednot be amenable to repaying the amount alleged-ly owed, the Department then takes the necessarylegal action to recover. In this action the claimantis the Department, and there is nothing wrong if itis done as in the present instance with theDepartment being represented by the Minister.

This is so since in any administrative hierarchy(such as a State department) there is deconcen-tration of powers and functions:

'...because it becomes impossible for the prin-ciple organ in the hierarchy to exercise allpowers and perform all functions. Often theexercise of the powers and the performance ofthe functions demand a special expertisewhich makes it essential that another body ororgan within the same hierarchy should dealwith the matter.'

M Wiechers: Administrative Law 1985

Notwithstanding the special expertise required,the ultimate responsibility for the exercise ofpower nonetheless rests, by virtue of the doctrineof Ministerial Responsibility, with the relevantMinister. Accordingly, defendant's first special pleais liable to be dismissed." (at paras 19-21)

In the case of Rates Action Group v City ofCape Town 2006 (1) SA 496 (SCA), the appli-cant, a voluntary association representing anumber of ratepayers' associations in CapeTown, challenged the respondent's authority toimpose a new systems of charging for munici-pal sewerage and refuse removal services.The new system, adopted towards the end of2002, imposed a fee composed of two ele-ments: the relevant component was a rate forservices based on the value of the property.This made up about half of the fee (the otherhalf was arrived at on the basis of a consump-tion-based tariff). Only about 20% of chargesunder the previous system were based on avalue-based rate, and the new system thus

meant a significant increase in service chargesfor property-owners whose property was val-ued at over R128 509,80 (at paras 6-7). Theappellant's argument was that the relevant leg-islation in force at the time, the LocalGovernment: Municipal Systems Act 32 of2000 (Systems Act) does not confer authorityon the respondent to charge a rate. (The courtrelied on Gerber v Member of the ExecutiveCouncil for Development Planning and LocalGovernment, Gauteng 2003 (2) SA 344 (SCA)to define "rate" as: "Assessment levied by localauthorities for local purposes at so much perpound of assessed value of buildings and landowned.") The appellant argued that the respon-dent is entitled in terms of the legislation tocharge a tariff only - the latter defined as a"table of charges for items and services" (atpara 13). The appellant argued that the respon-dent's power to charge for services was set outin section 74 - headed "Tariff policy" - and sec-tion 75 - setting out the requirement to promul-gate by-laws to give effect to tariff policy. Thecourt said:

"The appellant argues that all charges for servicesmust be made in terms of these sections. Thusthere must be a tariff, and, before that is adopted,there must be a tariff policy and by-laws promul-gated. When the City imposed the sewerage-serv-ice and refuse-removal charges, no policy hadbeen adopted and no by-laws passed.Accordingly, the argument goes, the chargesbased on the value of the property, rather than onuse of the service, are not permitted in terms ofthe Systems Act. The appellant finds support forthese contentions in s 74(2)(b), which requiresthat the amount paid for services by a user should'generally be in proportion' to their use; and in s74(2)(d), which requires that tariffs must reflect thecosts 'reasonably associated' with rendering theservice." (at para 16)

In the court a quo the appellant conceded thatthe Local Government Transition Act 209 of1993 conferred the power on the relevant localauthority to charge rates. Although the appel-lant contended in the court a quo that theSystems Act had impliedly repealed the rele-vant sections of the 1993 Act, the court a quofound that the sections had not been repealedand continued to exist alongside the SystemsAct. By the time the case came before theSCA, however, section 179 of the LocalGovernment: Municipal Finance ManagementAct 56 of 2003 had expressly repealed the rel-evant sections of the 1993 Act. The court

32

found, however, that the Systems Act con-tained no express prohibition on the chargingof property value-based rates, and rejected theappellant's argument that the decision to do sowas unlawful:

"Counsel for the appellant conceded, however,that a municipality may use revenue accumulatedthrough the collection of rates for general services- those to which all members of the public haveaccess, such as the use of library facilities, or themaintenance of roads and pavements. Indeed, inSouth African Municipal Workers Union v City ofCape Town 2004 (1) SA 548 (SCA) ([2003] 4 AllSA 348), this Court found that the use of somemunicipal services, such as a city police service,cannot be measured such that it can be chargedto individuals. He conceded also that the Act doesnot preclude the use of rates for the purpose ofsubsidising households. He argued, however, thatwhere consumption is attributable to a particularuser, such as the use of electricity, water, sewer-age services and refuse removal, the servicecharge must be based on use and determined inaccordance with a tariff.

There is, however, no limitation to be found in s 74,or in any other part of the Systems Act, on theuses to which rates may be put nor on the numberof rates that may be charged by a municipality.There is nothing to preclude the levying of severalrates in respect of a property. And the Systems Actdoes not oblige a municipality to charge for servic-es in accordance with a tariff - it simply entitles itto do so provided that a tariff policy has beenadopted and by-laws promulgated.

In the circumstances the argument for the appel-lant that the City was not permitted to charge arate for the sewerage services and refuse removalcannot succeed. Since this was the only issueargued on appeal, the appellant must fail." (atparas 18-20)

Common-law review - audi alterampartem

In Hos+Med Medical Aid Scheme andOthers v Kalipa and Others [2005] 4 All SA208 (T) (see above under ultra vires), the sec-ond to seventh applicants, members of theboard of trustees of the first applicant, wereheld to be unlawfully removed from office by aresolution at an annual general meeting by themembers of the first applicant. The resolutionwas thus set aside for want of lawfulness, sincethe action was not empowered either by theMedical Schemes Act 131 of 1998 or by thefirst applicant scheme's own rules. In relation tothe requirements of procedural fairness, how-

ever, Patel J held that even if the memberswere empowered to remove the trustees byresolution, the trustees had not been givenprior notice or an opportunity to respond to alle-gations of misconduct on which their removalwas premised:

"However, assuming that even if it is important thatthe Scheme's trustees could be removed by mem-bers at a general meeting then it is implicit that thetrustees should have been afforded an opportuni-ty to respond to any prejudicial allegations uponwhich their removal was based." (at para 34)

[NOTE: The judge in this case did not con-sider whether resolution removing thetrustees fell within the purview of PAJA,and thus did not test the procedure bywhich the resolution was passed againstthe provisions of PAJA. If PAJA did apply tothe resolution, though, the procedurewould have had to comply with the require-ments of section 3 of PAJA and could havebeen impugned in terms of section 6(2)(c) ifit failed to meet those requirements.]

The applicant in Aol v Minister of HomeAffairs and Others 2006 (2) SA 8 (D) was anUgandan national seeking refugee status inSouth Africa. Civil unrest in her own country,she claimed, had forced her to flee south toSouth Africa through Tanzania andMozambique, eventually arriving in Durban.After applying to the Department of HomeAffairs for refugee status in 2000, she wasinformed in 2002 that her application had beenrefused (at 9J-10C). She was advised that shecould appeal against this decision to the fourthrespondent, the Appeal Board. This she did,and was advised to appear before one Marobe- apparently a member of the Appeal Board.Marobe told the applicant that her meeting withher constituted a hearing before the AppealBoard, and also that she (Marobe) would sub-mit her evidence to the Appeal Board for con-sideration. Some time later the applicant wasinformed that the Appeal Board had dismissedher appeal. Based on the applicant's plead-ings, Swain J summarised the issues beforethe court as follows:

"1. Whether, in the light of the contents ofannexure A to the applicant's founding affi-davit, a decision had ever been taken by therelevant refugee status determination officer(hereafter referred to as RSDO) to refuse the

33

applicant's application and if not, whetherthe Appeal Board therefore had jurisdictionto hear the appeal in terms of s 26(2) of theAct?

2. Assuming that the hearing afforded to theapplicant was purely an enquiry or investiga-tion by the fourth respondent of its ownaccord in terms of s 26(3)(d) of the Act,whether the applicant was ever given anynotice of the actual appeal hearing by thethird or fourth respondents, and if not,whether the decision could stand?

3. Whether the fourth respondent was obligedto bring to the attention of the applicant, theprejudicial information contained in the saidUnited Kingdom Country Information andPolicy Unit Report and to afford the applicantan opportunity to deal with this informationbefore making a formal decision?" (at 11G-I)

The judge considered each of these in turn. Inregard to the first, he found that the evidencedid not support a conclusion that a decision onthe applicant's initial application had beenproperly taken in accordance with section 24 ofthe Refugee Act 130 of 1998:

"It is common cause that the applicant was inter-viewed by a RSDO at the Durban regional office ofthe Department of Home Affairs. After an unex-plained delay of two years the applicant was noti-fied by way of annexure A of the rejection of herapplication. The notification is on the letterhead ofthe Department of Home Affairs and signed by anunidentified person on behalf of the Director-General of this Department. It states 'theDepartment of Home Affairs has come to the con-clusion that your claim does not meet the refugeedefinition'. On the face of it the decision was takenby the Department and there is no evidence toindicate that the decision was taken by a RSDO,being the only person authorised to take such adecision in terms of the Act.When I raised this issue with Ms Singh, whoappeared for the third respondent, she fairly con-ceded that there was no evidence on the papers toshow that the decision had been taken by aRSDO, which is fatal to the jurisdiction of theAppeal Board to hear the appeal of the applicant."(at 12F-I)

Turning to the second issue, the judge foundthat if the interview with Marobe was a hearingof the Appeal Board the Appeal Board had notbeen properly constituted by a quorum of fourmembers when it heard the appeal (at 11C). Ifthe Appeal Board considered the matter at alater stage, however, the applicant had beendenied the right to make representations to theBoard:

"[T] he applicant contends that the audiencebefore Marobe was the appeal hearing, whereasthe third respondent contends that this was purelya preliminary enquiry or investigation, with theappeal hearing having been held at a later stage.I must say I have serious reservations about thenotice given to the applicant to make a personalappearance before the Appeal Board, beingannexure B to applicant's founding affidavit, beingconsistent with what was purely a preliminaryinvestigation. Be that as it may, I will assume with-out deciding in favour of the respondent that thiswas the case. The issue that then arises is whatnotice the applicant was given of the actual appealhearing. There is no evidence of any notice beinggiven to the applicant of the hearing. A corner-stone of the audi alteram partem rule is that anindividual is granted a proper opportunity to pres-ent his case. Baxter Administrative Law at 545.

Except where legislation prescribes otherwise,administrative bodies are at liberty to adopt what-ever procedure is deemed appropriate, providedthis does not defeat the purpose of the empower-ing legislation and provided that it is fair. The issueis whether the affected individual is entitled to bepresent at, and make representations to the Boardin question. Although s 26(3)(e) provides that theAppeal Board has the power to require the appli-cant to appear before it and provide information,this does not in itself provide a right to the appli-cant to do so. Section 26(4) however provides asfollows:

'The Appeal Board must allow legal represen-tation upon the request of the applicant.'

This provision in my view, carries two necessaryimplications: 1. The applicant is entitled to be present at the

hearing. If not, why would provision be madefor an entitlement to be legally representedat the hearing?

2. The applicant must be given notice of thehearing to be able to request and arrangelegal representation at the hearing.

When I put this aspect to Ms Singh she again fair-ly conceded that no notice was given to the appli-cant of the appeal hearing, and that this would befatal to the proceedings of the Appeal Board." (at12I-13F)

Finally, Swain J held that the applicant wasnever given an opportunity to respond to evi-dence - which the applicant herself had not putbefore the Board - on which the Board relied tomake its decision. The judge held:

"[I]n Kotze v Minister of Health 1996 (3) BCLR 417(T) it was held that the Director-General's consid-eration of information which did not form part of theapplicant's application, amounted to a denial ofprocedurally fair administrative action. The appli-

34

cant should have been given an opportunity to dealwith any information which did not form part of hisapplication, and which was later taken into accountwhen considering the application." (13J-14B)

The Appeal Board's decision was therefore setaside; but because the judge found that theoriginal decision to refuse the applicantrefugee status could not be said to have beenproperly made, the Appeal Board never hadjurisdiction to consider an appeal. There wastherefore no point in remitting the matter to theAppeal Board, and the judge ordered that theapplicant be given an opportunity to re-applyfor refugee status in terms of the Refugee Act(at 14E-H).

Common-law review - delay

Compass Waste Services (Pty) Ltd vNorthern Cape Tender Board and others[2005] 4 All SA 425 (NC) (see above undersection 6) concerned an application to reviewand set aside the award of a contract forwaster disposal service in the Northern Cape.The applicant company was an unsuccessfultenderer for the contract. Before consideringthe merits of the application, the court, perLacock J, applied itself to two preliminaryissues flowing from the delay in instituting themotion for review. As to delay generally, thecourt held that

"It is trite that an applicant who fails to bring areview application within a reasonable time mayforfeit his right to have the administrative actioncomplained of reviewed and set aside, unless thedelay is satisfactorily explained." (at para 9.1)

In this case, the first respondent's decision toaward the tender to the second respondentwas communicated to the applicant on 29October 2003. The application for review wasfiled only five months later, on 25 March 2004,and heard only on 18 April 2005 (at para 9.2).Although the court stated that on the face of itthis would appear to be an unreasonably longdelay, the explanation given was acceptable. Itis unnecessary here to review precisely theexplanation given by the applicant for its delay.It is enough to note that the court found that thedelay had been due to no fault of the applicant,and the applicant should not forfeit his rights toadministrative justice as a result of the delay(at para 9.4). [NOTE: The application wasnot brought in terms of PAJA, and the time

periods stipulated in PAJA within which anapplication for review must be broughtwere not considered by the court.]

The court then considered whether the delayhad nevertheless rendered any decision on theapplication of merely academic value. Thecourt noted that a court will usually not enter-tain a dispute between parties to answer hypo-thetical, abstract or academic questions (atpara 10). The court held in this case that thedispute had become moot, and no purposewould be served by considering the merits ofthe case. The contract awarded to the secondrespondent was for a period of 24 months. Bythe time the application was heard on 15August 2005, there was barely two months leftto run on the contract. The application fell to bedismissed on this basis alone for two reasons.First, if the applicant was successful and thematter was remitted to the first respondent, theprobabilities of it properly considering all thetenders before the expiry of the contract were"for all practical purposes non-existent" (atpara 10.2). Second, if the applicant's prayercompelling the first respondent to award thecontract afresh for a further two years, theNorthern Cape Department of Health - whichhad devised the tender specifications - wouldbe compelled to accept services in terms of acontract it had devised two years previously (atpara 10.4).

A similar comment was made by the SCA in thecase of Chairperson: Standing TenderCommittee and others v JFE SapelaElectronics (Pty) Ltd and others [2005] 4 AllSA 487 (SCA) (see above under section 1,section 3 and section 1 of the Constitution - thedoctrine of legality). The court held thatalthough the award of the tender to one ten-derer stood to be set aside, the effluxion of timehad the effect that it was no longer practicablefor the start tender process again for the out-standing work (at para 25). The court referredto Oudekraal Estates (Pty) Ltd v City of CapeTown 2004 (6) SA 222 (SCA) in stating that "Inappropriate circumstances a court will decline,in the exercise of its discretion, to set aside aninvalid administrative act" (at para 28). Thecourt noted in this respect that section 7(1) ofPAJA gives statutory recognition to the rule thatinordinate delay will, in effect, "validate" whatwould otherwise be a nullity (at para 28).

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In Seodin Primary School and others v MECof Education, Northern Cape and others[2006] 1 All South Africa 154 (NC) (see aboveunder section 3 and section 6), the courtagreed with the principle that a court of reviewwill not grant the relief claimed if such reliefwould be of no practical value to the partiesand of academic value only. The court was nothere concerned with the question of delay inproceedings specifically, although the caseinvolved the interest that school children havein attending school - where a delay of a meresix months carries some weight. After holdingthat the relief sought by the applicants shouldbe denied on the merits (see discussionabove), the court, per Kgomo JP, went on tohold that even if they had been correct on themerits the court would have been slow to setaside the decision of the administrator:

"I make bold to say that even if the applicants hadmade out a compelling case on the merits for thesetting aside of the impugned decisions, whichthey have not moreover are not now asking for, Icannot fathom how we could have excluded theaffected children from the schools without theintercession of a curator ad litem to independentlyand in an unbiased fashion see to the children'sbest interests. If need be we would have meromotu appointed a curator ad litem. See Du Toit vMinister of Welfare and Population Development2003 (2) South Africa 198 (CC) at 201G-202Awhereat the Court held:

'(The children) enjoyed the support ofAdvocate Stais of the Johannesburg Bar, whowas appointed by this Court to act as curatorad litem to represent the interests of the chil-dren who are the subject of this applicationand also other children born and unborn whomay be affected by this Court's order. In mat-ters where the interests of children are atstake, it is important that their interests are fullyaired before the Court so as to avoid substan-tial injustice to them and possibly others.Where there is a risk of injustice, a court isobliged to appoint a curator to represent theinterests of children. This obligation flows fromthe provisions of s 28(1)(h) of the Constitutionwhich provides that:

"Every child has the right-. . . (h) to have a legal practitioner assigned to

the child by the state, and at stateexpense, in civil proceedings affectingthe child, if substantial injustice wouldotherwise result."

Advocate Stais filed a thorough report con-cerning the welfare of the adoptive children ofthe second applicant and children generally.He also made submissions at the hearing ofthe matter'

This is an authoritative statement which is bindingon us." (at para 41, footnotes omitted)

The court concluded that because of the preju-dice to the children's best interests contained inthe setting aside of the respondents' decision,the court held that the decision could not havebeen set aside in any event. The remedysought by the applicants, "innocuous" as it mayhave appeared, "harbours hidden prejudicialconsequences for the unrepresented affectedchildren. We cannot, in these circumstancescome to the applicants' rescue." (at para 45).

In Transnet Ltd and another v SA MetalMachinery Co (Pty) Ltd [2006] 1 All SA 352(SCA) the respondent was an unsuccessfultenderer for a contract for the removal of galleywastes from ships in Cape Town Harbour. Therespondent successfully sought from the CapeHigh Court an order directing the appellant todisclose certain information. The informationsought was the tender document submitted bythe successful tenderer, Inter Waste (Pty) Ltd.Inter Waste did not oppose the application, butthe appellant did, and on appeal sought to relyon sections 36 and 37 of PAIA to resist disclo-sure of the information. Section 36 allows anorgan of state to refuse a request for informa-tion on the grounds that it forms part of a thirdparty's trade secrets, financial or technical dataor information the disclosure of which would beprejudicial to that third party. The relevant partsof the section read:

"Subject to subsection (2), the information officerof a public body must refuse a request for accessto a record of the body if the record contains-(a) trade secrets of a third party;(b) financial, commercial, scientific or technical

information, other than trade secrets, of athird party, the disclosure of which would belikely to cause harm to the commercial orfinancial interests of that third party; or

(c) information supplied in confidence by a thirdparty the disclosure of which could reason-ably be expected-(i) to put that third party at a disadvantage

in contractual or other negotiations; or

THE PROMOTION OFACCESS TO INFORMA-

TION ACT (PAIA)

36

(ii) to prejudice that third party in commer-cial competition."

Section 37(1)(a) allows the refusal of a requestif the disclosure of a third party's informationmight open the disclosing body up to an actionbased on a breach of confidence:

"Subject to subsection (2), the information officerof a public body-(a) must refuse a request for access to a record

of the body if the disclosure of the recordwould constitute an action for breach of aduty of confidence owed to a third party interms of an agreement".

The court, per Howie P, held that PAIA is enact-ed to manage and balance the competing rightsof members of the public. On the one hand,everyone has the right of access to any infor-mation held by the state in section 32(1) of theConstitution. On the other hand, theConstitution confers an entrenched right to pri-vacy, and the Appellate Division has recognisedthat companies have a right to privacy inrespect of sensitive and confidential information(at paras 8-9, referring to Financial Mail (Pty)Ltd v Sage Holdings Ltd 1993 (2) SA 451 (A)).

The court offered an interpretation of section36(1) that focussed on the use of the term "like-ly" in paragraph (a) and "could reasonably beexpected" in paragraph (c). It rejected Currieand Klaaren's view that the test in paragraph(c) is less stringent than that in paragraph (b).Howie P said in this regard:

"In my view an interpretation that involves the useof degrees of probability creates the potential forconfusion and could well lead to problems in thepractical application of the legislation to concretecases. 'Probable' is a word well known in the law.It should bear the same meaning in all situationsabsent indications to the contrary. The same con-siderations apply to the equivalents of 'probability'.'likely' and 'likelihood'. The question remainswhether the results specified in (c) were intendedto be probable, not merely possible, conse-quences. . . . .What can be expected is accordingly the contem-plation of something that will, not might, happen. Ifwe say we are expecting somebody this eveningwe mean that we think the person will be coming,not merely might be.

It follows that the difference between (b) and (c) ofsection 36(1) is to be measured not by degrees ofprobability. Both involve a result that is probable,

objectively considered. The difference, in my view,is to be measured rather by degrees of expecta-tion. In (b), that which is likely is something that isindeed expected. This necessarily includes, atleast that which would reasonably be expected. Bycontrast, (c) speaks of that which 'could reason-ably be expected'. The results specified in (c) aretherefore consequences (i) that could be expectedas probable (ii) if reasonable grounds exist for thatexpectation." (at paras 40-42)

The appellant's contention was that based onthe facts (set out by the court at paras 44-45),the disclosure of the information requestedwould give the respondents insight into thefruits of Inter Waste's research and enable therespondent to ride on Inter Waste's efforts byadjusting its business model accordingly (atpara 46). The contested information wasessentially the structure according to whichInter Waste had determined its rates for servic-es tendered for. The court did not uphold theargument that disclosure of the informationwould lead to the adverse consequences setout in paragraphs (b) and (c) of section 36(1):

"The first respondent's counsel countered [theappellant's] contention on a twofold basis. The firstwas that, as a matter of logic, it would be impossi-ble to deduce Inter Waste's profit margin, forexample, simply from knowing its rates. To do sonecessitated knowing all the other variable andconstant factors to which the appellant hadreferred and which it was not alleged the respon-dent had. On the assumption that all those factorscomprised confidential information, the disclosureof which would later harm inter Waste, revealingthe rates would not amount to such a disclosure inrespect of any of the four items in question.

As regards the price adjustment example basedon reference to items 1 and 2, counsel argued thatthe rates would at most provide a rough indicationof Inter Waste's prediction of the number of month-ly removals. It could not lead to a precise enoughanswer to be useful to the respondent. It was sub-mitted in the alternative, on the assumption thatthe rates could enable the respondent to make aprecise deduction, the answer obtained could beof no use to the respondent either in respect of thetender in question or any tender called for inrespect of a new contract from 2005 onwards." (atparas 47-48)

The appellant's argument based on section 37was based on a clause in the contract conclud-ed between the appellant and Inter Waste fol-lowing the award of the tender. The relevantclause stated that the appellant would not "dis-close the successful tenderer's tender price or

37

any other tendered prices as this is regardedas confidential information (at para 52).Disclosure of the information sought, theappellant argued, would breach this provisionand expose the appellant to an action by InterWaste (at para 53). The court took a differentview, though. First, it held that the confidential-ity clause referred only to the tender price andnot the schedule of prices and quantities - theinformation actually sought by the respondent.In any case, Inter Waste had already consent-ed to the disclosure of the tender price. Theconfidentiality clause was therefore no bar todisclosure of the tender price (at para 54).Second, the court held that the appellant borea constitutional duty to conduct its operationstransparently and accountably. Once it hasentered into a commercial agreement, mem-bers of the public are entitled to know theexpenditure such an agreement entails. Theintention of the drafter of the confidentialityclause, as interpreted by the court, was that nocompeting tenderer should be entitled to knowthe tender prices of its competitors in the pre-award phase of the tender. It followed that oncethe contract was awarded,

"the confidentiality clause, certainly insofar as thesuccessful tenderer is concerned, was a spentforce and offered Inter Waste no further protectionfrom disclosure as regard its tender price"

The appeal was therefore dismissed.

I M Rautenbach, "The limitation of rightsand 'reasonableness' in the right to justadministrative action and the rights toaccess to adequate housing, health servic-es and social security" (2005) 4 Tydskrif virdie Suid-Afrikaanse Reg, 627. The articleexplores whether and to what extent the limita-tions clause in section 36 of the Constitutioncan be of use in determining the function of"reasonable" in sections 33, 26(2) and 27(2) ofthe Constitution.

Marinus Wiechers, "Quo vadis geregtelikehersiening van administratiewe han-delinge?" (2005) 3 Tydskrif vir die Suid-Afrikaanse Reg, 469. The article traces the

development of administrative law in SouthAfrica from the pre-constitutional era to whereit is today. It is argued that the new administra-tive law dispensation did not come out of theblue, but was the culmination of a project ofreform and development that began evenbefore the dawn of constitutional democracy inSouth Africa.

P J Visser, "Aspects of the application ofthe Private Security Industry Regulation Act56 of 2001 outside South Africa" 134. Withmembers of the South African private securityindustry active in countries beyond the bordersof South Africa, questions are raised about theability of our law to address the impact of these"international elements" on our security indus-try. The article identifies and evaluates the reg-ulatory framework that applies outside the bor-ders of South Africa.

P J Visser, "Regulation of the private secu-rity industry - scheme to avoid certain obli-gations in terms of the Private SecurityIndustry Regulation Act 56 of 2001: ThePrivate Security Industry RegulatoryAuthority v The Association of IndependentContractors and Deyzel, case no 127/2004(SCA)" (2006) 69(1) Tydskrif virHedendaagse Romeins-Hollandse Reg, 157.This is a review of a case concerned with theproper construction of legislation. The respon-dents to the case had attempted to avoid regu-lation as members of the private security indus-try, and argued that the legislation at issue didnot apply to them.

Geo Quinot, "The regulation of in-flightfilms" (2005) 1 Stellenbosch Law Review,45. The article examines the regulatory frame-work within which films are exhibited on boardcommercial airliners, and, by comparing it withthe jurisdictional scheme within which airlinesoperate, attempts to establish the regulatoryregime for in-flight films.

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