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Introduction

Two separate issues regarding the relationshipbetween administrative law and labour lawhave arisen in South African law in recentyears. The first is whether the Promotion ofAdministrative Justice Act 3 of 2000 (PAJA)applies to employment decisions in the arenaof public sector or government employment,and the second is whether decisions of theCommission for Conciliation. Mediation andArbitration (CCMA), established in terms of theLabour Relations Act 66 of 1995 (LRA), arereviewable by the courts on the basis only ofthe grounds of review set out in the LRA, or ifthese decisions amount to administrativeaction and are reviewable on the more exten-sive grounds of review set out in PAJA. Thecontrasting responses of the high courts,Labour Court, Labour Appeal Court (LAC) andthe Supreme Court of Appeal (SCA) to theseissues were considered in a PAJA NewsletterSpecial Issue published alongside the 8thEdition of the PAJA Newsletter. Since the pub-lication of the Special Issue, the ConstitutionalCourt has considered both of the issues. Thisspecial section of the 9th Edition of the PAJANewsletter considers the views of theConstitutional Court in regard to each of theseissues.1 Public sector employment decisionsas administrative action for the purposes ofPAJA - Chirwa v Transnet Ltd and others[2007] JOL 21166 (CC)

The definition of administrative action in sec-tion 1 of PAJA reads:

'"administrative action" means any decisiontaken, or any failure to take a decision, by- (a) an organ of state when-

(i)exercising a power in terms of the Constitution or a provincial constitution;or(ii)exercising a public power or performing a public function in terms of any legislation'.

There are three base on which courts havedecided the issue of whether PAJA applies topublic sector employment decisions. The first isthe view that employment decisions are a pure-ly private affair, which entail no element of pub-lic power. The second, related consideration, isthat a public sector employment decision is notthe exercise of a public power if the source ofthe power is contractual rather than statutory.These two considerations go directly to the def-inition of administrative action as it is laid out inPAJA. The third basis of decision has consid-ered whether administrative law should applyto public sector employment decisions in lightof the fact that the field is already covered bythe LRA and the body of labour law.

The Constitutional Court addressed each ofthese issues in Chirwa v Transnet Ltd and oth-ers [2007] JOL 21166 (CC). The matterinvolved the dismissal of Ms Chirwa from theemploy of Transnet Ltd. She complainedagainst her dismissal first in terms of the LRA,and aired her grievance in conciliation pro-ceedings before the CCMA. Following the fail-ure of the CCMA to resolve the issue, insteadof proceedings to arbitration before the CCMAand ultimately to the Labour Court in terms ofthe LRA, Ms Chirwa approached the HighCourt seeking administrative review ofTransnet's decision to dismiss her. Theessence of her complaint was that one MrSmith acted both as complainant against herwork performance as well as adjudicator of herdisciplinary hearing, and that this infringedadministrative justice rights to procedural fair-ness. The crisp questions raised by thisapproach were whether the High Court hadjurisdiction to hear Ms Chirwa's complaint, andwhether Transet's decision constituted admin-istrative action within the ambit of PAJA. Threejudgments were written in the SCA decision. Allthree judgments held that the High Court hadjurisdiction to hear the matter. Mthiyane JA(Jafta JA concurring) concluded that the deci-sion did not amount to the exercise of a publicpower and did not therefore satisfy the require-ments of the definition of administrative action;Conradie JA found that the decision didamount to administrative action but held thatlabour law applied to the dispute and left noroom for the principles of administrative law;and Cameron JA (Mpati DP concurring) foundthat the decision amounted to administrativeaction and should be reviewed as such. In the

CASE LAWTHE RELATIONSHIP BETWEEN

ADMINISTRATIVE LAW ANDLABOUR LAW: RECENT CONSTI-

TUTIONAL COURT DECISIONS

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Constitutional Court, three judgments wereagain written: judgments by Skweyiya J andNgcobo J together constitute the majority (bothjudgments were concurred in by the samemajority of judges), and a minority dissent writ-ten by Langa CJ concurred in by Mokgoro Jand O'Regan J.

(a) Skweyiya J's judgmentSkweyiya J's judgment turned on jurisdictionalconsiderations. It was argued on behalf of MsChirwa that the High Court was the appropriateforum to hear the matter since, in terms of sec-tion 157(2) of the LRA, the High Courts have'concurrent jurisdiction' with the Labour Courts'in respect of any alleged or threatened viola-tion of any fundamental right' entrenched in theBill of Rights. Section 157(1) of the LRA, on theother hand, confers exclusive jurisdiction onthe Labour Courts in respect of all matters 'thatare to be determined by the Labour Court' interms of the LRA or any other legislation.Skweyiya J considered Ms Chirwa's claim inlight of this framework. Important to his reason-ing was the characterisation of Ms Chirwa'schallenge to her dismissal as a failure to com-ply with procedures set out in the LRA:

'Ms Chirwa's complaint is that Mr Smith "failed tocomply with the mandatory provisions of items 8and 9 of Schedule 8 to the LRA." Schedule 8 con-tains the Code that sets out guidelines that mustbe taken into account by "[a]ny person consideringwhether or not the reason for dismissal is a fairreason or whether or not the dismissal was effect-ed in accordance with a fair procedure" [section188(2) of the LRA].' (para 61)

Skweyiya J then pointed out that unfair dis-missals and unfair labour practices are dealtwith by the provisions of the LRA, that section188 provides that a dismissal is unfair unlessthe employer can demonstrate that the dis-missal was procedurally fair and supported byfair reasons, and that item 9 of Schedule 8 tothe LRA sets out the guidelines for dismissal oncases of poor work performance (para 62).Skweyiya J therefore concluded:

'This is a dispute envisaged by section 191 of theLRA, which provides a procedure for its resolution:including conciliation, arbitration and review by theLabour Court. The dispute concerning dismissalfor poor work performance, which is covered bythe LRA and for which specific dispute resolutionprocedures have been created, is therefore a mat-ter that must, under the LRA, be determined exclu-sively by the Labour Court. Accordingly, it is my

finding that the High Court had no concurrent juris-diction with the Labour Court to decide this matter.'(para 63)

Skweyiya J dismissed the appeal on the basisof jurisdiction alone. On the administrative lawquestion raised by the matter, he aligned him-self with both Conradie JA in the SCA (para 44)and Ngcobo J's judgment (para 73). He fol-lowed the line that the decision ofAdministrator, Transvaal, and Others v Zenzileand Others 1991 (1) SA 21 (A), the case onwhich Cameron JA relied in the SCA in holdingthat the dismissal was the exercise of a publicpower and amounted to administrative action,had been decided in a statutory context inwhich public sector employees enjoyed nolabour rights, and that, since the LRA hadextended labour rights to public sector employ-ees, the principles of administrative law nolonger applied (paras 38-42).

Both Langa CJ and Ngcobo J found that thematter could not be disposed of purely on thebasis of jurisdiction. Langa CJ began by point-ing out two flaws in Skweyiya J's approach.The first was that Skweyiya J's conclusion inregard to jurisdiction rested on a flawedassessment of the case as pleaded by MsChirwa:

'According to Skweyiya J, "Ms Chirwa's complaintis that Mr Smith 'failed to comply with the manda-tory provisions of items 8 and 9 of Schedule 8 tothe LRA'." I take a different view of the applicant'sclaim. While the quoted sentence does indeedappear in the applicant's submissions, it formsonly a small part of her argument. The bulk of hersubmissions were devoted to arguments basedsquarely on PAJA. Firstly, she contends that herdismissal is administrative action as understoodby PAJA. In addition, her substantive complaintswere that the alleged administrative action contra-vened: (a) section 3(2)(b) of PAJA for failing to pro-vide adequate notice; (b) section 6(2)(a)(iii) ofPAJA because the administrator was biased; and(c) section 3(3)(a) of PAJA because she was pre-vented from obtaining assistance or representa-tion. The reference to items 8 and 9 is used solelyto bolster a further argument that her dismissalalso violated sections 6(2)(b) and 6(2)(f)(i) ofPAJA. These sections provide for the review ofactions that are not permitted by the empoweringprovision or contravene another law.

While that argument alone might have been con-strued as a disguised reliance on the LRA, in thebroader context of her argument, I do not believethat is a fair or correct characterisation. It shouldbe added that it was not a characterisation urgedupon us by the applicant's counsel in argument;

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nor one adopted in any of the three judgments inthe Supreme Court of Appeal, nor in the HighCourt judgments. In my view, it is incorrect.

Most of my disagreement with the judgment ofSkweyiya J flows from this mischaracterisation. Itseems clear to me that, evaluated as a whole, theapplicant's complaint is that her dismissal shouldbe evaluated in terms of PAJA, not the LRA.Whatever we think of the wisdom of her election toavoid the specialised provisions of the LRA, wemust evaluate the claim as it was presented to us.'(paras 157-59, footnotes omitted)

The second flaw Langa CJ pointed out was alogical one. Ms Chirwa's claim was thatTransnet's action in dismissing her amountedto administrative action, and could be reviewedas such. The jurisdiction of the High Court,Langa CJ pointed out, could not depend on thecorrectness of this claim:

'The determination of whether the dismissal doesconstitute administrative action is part of the mer-its of the claim, not a jurisdictional requirement.The finding, however, rests on the case as plead-ed by Ms Chirwa. She formulated her case on thebasis of PAJA, and a court must assess its juris-diction in the light of the pleadings. To hold other-wise would mean that the correctness of an asser-tion determines jurisdiction, a proposition that thisCourt has rejected [in Fraser v ABSA Bank Ltd(National Director of Public Prosecutions asAmicus Curiae) 2007 (3) SA 484 (CC)]. It wouldalso have the absurd practical result that whetheror not the High Court has jurisdiction will dependon the answer to a question that the Court couldonly consider if it had that jurisdiction in the firstplace. Such a result is obviously untenable.' (para169, footnotes omitted)

Although Ngcobo J agreed with Skweyiya J'sconclusions in regard to jurisdiction (para 125),and is to that extent subject to the same criti-cism made of Skweyiya J by Langa CJ,Ngcobo J did address the administrative lawquestion, and differed in his conclusions tothose reached by Langa CJ. Consideration ofboth of these judgments follows.

(b) Ngcobo J's judgment Ngcobo J began by noting that what has divid-ed the approach of the courts on the issue ofwhether public sector employment decisionsattract principles of administrative law is 'dis-agreement over whether the decision of a pub-lic entity to dismiss an employee should becharacterised as the exercise of a publicpower' (para 129). After reviewing the views

and reasoning of the courts below, Ngcobo Jtook account of Langa CJ's view that the powerexercised by Transnet in this matter was notpublic since it was sourced in contract (para137). Ngcobo J differed from this opinion:

’Neither the Supreme Court of Appeal nor the HighCourt considered the proper cause of action.They approached the matter on the footing thatthere was an overlap in the grounds of reviewunder the common law, ECA and PAJA. It isapparent that the decision of this Court in BatoStar Fishing (Pty) Ltd v Minister of EnvironmentalAffairs and Others [2004 (4) SA 490 (CC)] was notdrawn to the attention of the courts below. By thetime the matter reached this Court, however, theapplicant had made up its mind; it relied on PAJA,in particular, on subsections 6(2)(b), 6(2)(e)(iii)and 6(2)(i). It is necessary to address this issueand put in context the provisions of section 36 ofECA which make provision for a person aggrievedby a decision made under ECA to approach a highcourt for review.

However, Ngcobo J proceeded to argue thatTransnet's decision, although correctly charac-terised as the exercise of a public power, couldnot properly be called an administrative actionsince the source of the power was contractual:

'The subject matter of the power involved here isthe termination of a contract of employment forpoor work performance. The source of the poweris the employment contract between the applicantand Transnet. The nature of the power involvedhere is therefore contractual. The fact thatTransnet is a creature of statute does not detractfrom the fact that in terminating the applicant'scontract of employment, it was exercising its con-tractual power. It does not involve the implementa-tion of legislation which constitutes administrativeaction. The conduct of Transnet in terminating theemployment contract does not, in my view, consti-tute administration. It is more concerned withlabour and employment relations. The mere factthat Transnet is an organ of State which exercisespublic power does not transform its conduct in ter-minating the applicant's employment contract intoadministrative action. Section 33 is not concernedwith every act of administration performed by anorgan of state. It follows therefore that the conductof Transnet did not constitute administrative actionunder section 33.' (para 142)

Langa CJ's conclusion, as Ngcobo J para-phrased it, was that the power Transnet exer-cised was not a public power because itssource was contract rather than legislation,Ngcobo J disagreed with this view, holding thatTransnet's decision did amount to the exerciseof a public power. Somewhat surprisingly,Ngcobo J proceeded to find that the decision

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did not constitute administrative action precise-ly because it was made in terms of the contractof employment. In any case, Ngcobo J goes onto give another reason for holding thatTransnet's decision did not constitute adminis-trative action. This reason is consistent with theapproach adopted in the SCA by Conradie JA:

'[T]he line of cases which hold the power to dis-miss amounts to administrative action rely onZenzile. This case and its progeny must be under-stood in the light of our history. Historically,recourse was had to administrative law in order toprotect employees who did not enjoy the protec-tion that private sector employees enjoyed. Sincethe advent of the new constitutional order, all thathas changed. Section 23 of the Constitution guar-antees to every employee, including public sectoremployees, the right to fair labour practices. TheLRA, the Employment Equity Act [55 of] 1998, andthe Basic Conditions of Employment Act [75 of]1997, have codified labour and employment rights.The purpose of the LRA and the Basic Conditionsof Employment Act is to give effect to and regulatethe fundamental right to fair labour practices con-ferred by section 23 of the Constitution. Both theLRA and the Basic Conditions of Employment Act,were enacted to give effect to section 23, now gov-ern the public sector employees, except thosewho are specifically excluded from its provisions.Labour and employment rights such as the right toa fair hearing, substantive fairness and remediesfor non-compliance are now codified in the LRA. Itis no longer necessary therefore to treat publicsector employees differently and subject them tothe protection of administrative law.

In my judgement labour and employment relationsare dealt with comprehensively in section 23 of theConstitution. Section 33 of the Constitution doesnot deal with labour and employment relations.There is no longer a distinction between privateand public sector employees under ourConstitution. The starting point under ourConstitution is that all workers should be treatedequally and any deviation from this principleshould be justified. There is no reason in principlewhy public sector employees who fall within theambit of the LRA should be treated differently fromprivate sector employees and be given more rightsthan private sector employees. Therefore, I amunable to agree with the view that a public sectoremployee, who challenges the manner in which adisciplinary hearing that resulted in his or her dis-missal, has two causes of action, one flowing fromthe LRA and another flowing from the Constitutionand PAJA.' (para 148-49)

Ngcobo J concluded that Transnet's decision todismiss Ms Chirwa did not constitute adminis-trative action as contemplated by section 33 ofthe Constitution, and there was accordingly noneed to consider separately the application of

PAJA (para 150).

(c) Langa CJ's judgmentIn addressing the approach to jurisdictiontaken by Skweyiya J, Langa CJ relied on whathe described as an important principle:

'Both PAJA and the LRA protect important consti-tutional rights and we should not presume that oneshould be protected before another or presume todetermine that the "essence" of a claim engagesone right more than another. A litigant is entitled tothe full protection of both rights, even when theyseem to cover the same ground. I agree withCameron JA that, while it may be possible for thelegislature to prefer one right over another, it mustdo so much more explicitly than it has in the LRAand PAJA... The implication is that there is no con-stitutional reason to prefer adjudication of a claimthat may simultaneously constitute both a dis-missal and administrative action, under the LRArather than under PAJA. I should add that the leg-islature could resolve any potential problems ofduplication by conferring sole jurisdiction to dealwith any disputes concerning administrative actionunder PAJA arising out of employment upon theLabour Court. So far the legislature has not cho-sen this route.' (para 175)

In taking this view, Langa CJ rejects the viewthat the principles of administrative law can beousted, where they would otherwise apply, sim-ply by the application of labour law principles.The issue before the court - 'whether the dis-missal of Ms Chirwa by Transnet constitutedadministrative action within the meaning ofsection 33 of the Constitution and PAJA' (para179) - could not be answered simply by assert-ing that the matter would be more suitablyresolved through the application of labour law.

Against this background, Langa CJ went on toconsider whether Transnet's decision met thedefinitional requirements of administrativeaction set out in section 1 of PAJA. He held thatbecause the decision had been taken entirelyin terms of the contract of employment, whereno legislative provision in any legislation pro-vided for the appointment and dismissal of per-sons in the position of Ms Chirwa, the decisionhad not been taken 'in terms of legislation'(paras 182-84). This was sufficient on its ownto justify a conclusion that Transnet's decisiondid not amount to administrative action (para185). Langa CJ nevertheless went on to con-sider whether the power could be considered'public'. He relied on Cape MetropolitanCouncil v Metro Inspection Services (Western

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Cape) CC and Others 2001 (3) SA 1013 (SCA)for the proposition that a public entity does notexercise public power when it gains no addi-tional advantage from its public position (para187). The power Transnet has over its employ-ees, he said, 'flows merely from its position asan employer and would be identical if it hadbeen a private company' (para 187). A secondfactor Langa CJ considered was whether theexercise of the power had any significantimpact on the public. The fact that it did not, inhis view, suggested that the power exercisedshould not be characterised as public.

(d) ConclusionLanga CJ took the view in this matter that thedetermination of whether an employment deci-sion by a public sector employee amounts toan administrative action depends on the facts.He found in this case that Transnet's decisiondid not constitute an administrative action, butnoted that his reasoning 'does not entail thatdismissals of public employees will never con-stitute "administrative action" under PAJA.'(para 194) In this important regard he differedfrom Skweyiya J and Ngcobo J, whose conclu-sions do entail that public sector employmentdecisions will never constitute administrativeaction. Skweyiya J and Ngcobo J constitutedthe majority in this case. Therefore, the princi-ple to emerge from the Constitutional Court inthis regard is that public sector employmentdecisions will be governed exclusively bylabour law and the LRA and will never amountto administrative action within the meaning ofsection 33 of the Constitution or PAJA.

2 The application of PAJA to decisionsof the CCMA - Sidumo and Another vRustenburg Platinum Mines and Others[2007] JOL 20811 (CC)(a) Background to the problemThe Commission for Conciliation, Mediationand Arbitration (CCMA) was created in terms ofthe LRA in 1995. It is an organ of state chargedwith assisting in the resolution of labour dis-putes. It must attempt to resolve any disputereferred to it by any party by conciliation.Where conciliation fails, and the partiesrequest the CCMA to do so, it is empowered tomake arbitration awards that are binding on theparties (see section 115 of the LRA). There isno appeal against a decision of the CCMA interms of the LRA to the Labour Court norindeed any other court, but the Labour Court is

empowered by section 145 of the LRA to scru-tinise the decisions of the CCMA. The relevantparts of section 145 provide:

'(1) Any party to a dispute who alleges a defect in any arbitration proceedings under the auspices of the Commission may apply to the Labour Court for an order setting aside the arbitration award-

(a)within six weeks of the date that the award was served on the applicant...

(2) A defect referred to in section

(1), means-(a) that the commissioner-

(i) committed misconduct in relation to the duties of the commissioner as an arbitrator;

(ii) committed a gross irregularity in the conduct of the arbitration proceedings; or

(iii) exceeded the commissioner's powers; or

(b)that an award had been improperly obtained.'

Section 158(1)(g) of the LRA provides room forthe Labour Court to review the conduct of theCCMA on broader grounds. It provides that theLabour Court may:

'subject to section 145, review the performance orpurported performance of any function providedfor in this Act on any grounds that are permissiblein law'.

The relationship between sections 145 and158(1)(g) raises questions about the properscope and extent of review of CCMA decisions.The core question has been whether theLabour Court, when reviewing decisions of theCCMA, may have regard to the grounds ofreview set out by administrative law in additionto the grounds of review set out in section 145.

(b) Views of the courtsThe Labour Appeal Court (LAC) first turned tothis question in Carephone (Pty) Ltd v MarcusNO and Others 1999 (3) SA 304 (LAC).Deciding the issue before PAJA had beenenacted, and therefore in terms of item23(2)(b) of Schedule 6 to the Constitution, theLAC held that the administrative justice provi-sions of the Constitution suffused the LRA andextended the scope of review allowed by sec-tion 145 of the LRA. The LAC said in that case:

'The peg on which the extended scope of reviewhas been hung is the constitutional provision that

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administrative action must be justifiable in relationto the reasons given for it (s 33 and item 23(2)(b)of Schedule 6 to the Constitution). This provisionintroduces a requirement of rationality in the meritor outcome of the administrative decision. Thisgoes beyond mere procedural impropriety as aground for review, or irrationality only as evidenceof procedural impropriety.' (para 31)

Once PAJA had been enacted, the question ofwhether the scope of review of CCMA deci-sions extended to administrative law groundswould come to rest on whether PAJA applied toCCMA decisions - or more specifically, whetherCCMA decisions amounted to 'administrativeaction' as defined in section 1 of PAJA. Thequestion of PAJA's applicability was squarelyraised before the LAC in Shoprite Checkers(Pty) Ltd v Ramdaw NO and Others 2001 (4)SA 1038 (LAC). The LAC found it unnecessaryto decide the issue, though, finding that theCCMA's decision could be evaluated reviewedagainst the rationality standard set byCarephone (para 33). The court did howeveraccept 'the possibility that PAJA may well beapplicable to arbitration awards issued by theCCMA' (para 33).

In Rustenburg Platinum Mines Ltd (RustenburgSection) v Commission for Conciliation,Mediation and Arbitration 2007 (1) SA 576(SCA) the SCA was asked to decide waswhether standards of administrative review asset out in section 6(2) of PAJA can be relied onin reviewing decisions of the CCMA. TheCarephone test, as it stands the high-watermark of administrative review of CCMA deci-sions, investigates only whether there is arational connection between the material andfacts before the commissioner and the sub-stance of his decision. Section 6(2)(f)(ii) ofPAJA sets out similar grounds of review:

'(2) A court or tribunal has the power to judicially review an administrative action if-(f) the action itself-(ii) is not rationally connected to-(aa) the purpose for which it was taken;(bb) the purpose of the empowering provision;(cc) the information before the administrator;(dd) the reasons given for it by the administrator'.

Section 6(2) of PAJA lists a wealth of otherbases on which administrative decisions canbe reviewed. Rationality is merely one of thegrounds of review available in terms of PAJA.

Importantly, section 6(2)(h) of PAJA allowsreview of an administrative decision on thebasis of its unreasonableness. The applicationof PAJA to CCMA decisions would greatlyexpand the extent of review contemplated bysection 145 of the LRA.

Cameron JA, writing for the Court inRustenburg Platinum, was in no doubt that acommissioner's decision in the CCMA amountsto administrative action as defined in PAJA(para 24). The question was thus not whetherCCMA decisions fit the definitional require-ments of PAJA, but whether the application ofPAJA is precluded by the application of theLRA to labour disputes. Cameron JA held thatit was not. Part of his reasoning in this regardwas that PAJA enjoys primacy over the LRAsince PAJA is constitutionally mandated bysection 33(3) of the Constitution (para 24).Another part of his reasoning was thatCarephone formulated the rationality test onthe basis of the rights to administrative justiceconferred by the interim Constitution, and thatit would be untenable for the level and extent ofprotection to be reduced by the 1996Constitution (para 26). Applying the review testas set out in section 6(2)(f)(ii) of PAJA, the SCAheld that the commissioner's decision could notbe rationally justified and had to be set aside.

The employee, Mr Sidumo, was aggrieved bythis decision and sought the consideration ofthe Constitutional Court. The matter wasargued before the Court in May 2007 anddecided in October 2007. The decision is avail-able as Sidumo and Another v RustenburgPlatinum Mines and Others [2007] JOL 20811(CC). Four judgments were filed in theConstitutional Court's decision. While Sidumo'sappeal was upheld and the SCA judgmentoverturned, there was an important differencein the reasoning of the judges. The court, com-posed of a quorum of ten judges, unanimouslyheld that decisions of the CCMA do not consti-tute administrative action within the meaning ofsection 1 of PAJA. The Court was split, howev-er, on the question of whether review in termsof section 145 of the LRA was infused with thestandards of administrative justice set by sec-tion 33 of the Constitution. In a judgment con-curred in by Moseneke DCJ, Madala J,O'Regan J and Van der Westhuizen J, NavsaAJ held that CCMA decisions are administra-tive actions but that PAJA does not apply. He

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went on to hold that section 145 of the LRAmust be interpreted consistently with theConstitution, and must be read to ensure thatadministrative action by the CCMA is lawful,reasonable and procedurally fair as required bysection 33 of the Constitution. O'Regan J wrotea separate judgment emphasising slightly dif-ferent reasons for the same conclusion.Ngcobo J, in a judgment concurred in byMokgoro J, Nkabinde J and Swewyiya J, con-curred in the order made by Navsa AJ but dis-agreed with the conclusion that section 33 wasapposite to the review of CCMA decisions.Sachs J concurred in both Navsa AJ's judg-ment and Ngcobo J's judgment, giving his rea-sons in a separate judgment.

The multiple judgments do not offer a clear res-olution of the underlying legal problem. Fivejudges hold that PAJA does not apply to CCMAdecisions but that section 33 of the Constitutiondoes. Four judges hold that although neithersection 33 nor PAJA are implicated by CCMAdecisions, those decisions can nevertheless bereviewed against some standard of reason-ableness. The determination of a majority, andthus of a precedent, is however complicated bySachs J's floating allegiance. The judgmentsare analysed in detail below in an attempt todetermine if there is any agreement on legalprinciple that can offer a clear and unambigu-ous precedent.

(c) Navsa AJ's judgmentIn considering whether PAJA or the LRA gov-erned the CCMA's functions, Navsa AJ beganby considering whether the decisions of theCCMA are 'administrative actions'. He beganby referring to a statement of the ConstitutionalCourt in President of the Republic of SouthAfrica and Others v South African RugbyFootball Union and Others 2000 (1) SA 1 (CC)(SARFU) directing courts to look to the natureof the function performed in determiningwhether it is administrative or not:

'In s 33 the adjective "administrative" not "execu-tive" is used to qualify "action". This suggests thatthe test for determining whether conduct consti-tutes "administrative action" is not the questionwhether the action concerned is performed by amember of the executive arm of government.What matters is not so much the functionary as thefunction. The question is whether the task itself isadministrative or not.' (para 141, quoted at para81)

Navsa AJ went on to note that although theCCMA exercise powers and performs functionsthat are similar to those of a court or judicial tri-bunal, there are significant differences (paras82-85). The judge referred to academic opinionin support of his view that the CCMA's func-tions should be seen as differentiated fromthose of the courts. He quoted Brassey:

'Unlike the Labour Court, it enjoys none of the sta-tus of a court of law and so has no judicial author-ity within the contemplation of the Constitution. It isan administrative tribunal in the same way as theindustrial court was and, being an organ of stateunder s 239 of the Constitution, is directly boundby the Bill of Rights. It is also subject to the basicvalues and principles governing public administra-tion.' (Brassey Employment and Labour Law:Commentary on the Labour Relations Act (2006)at A7-1 - A7-2, quoted at para 86)

And he quoted Currie and De Waal:

'The CCMA is not a branch of the judiciary anddoes not exercise judicial power. Rather, the exer-cise of the compulsory arbitration power is anexercise of public power of an administrative("governmental") nature. The arbitration power isdesigned to fulfil the primary goal of the Act whichis to promote labour peace by the effective settle-ment of disputes. It does so with an element ofcompulsion, corresponding to the traditional gov-ernment/governed relationship.' (Currie and DeWaal Bill of Rights Handbook 5 ed (2005) at 651,quoted at para 87)

Navsa AJ noted that in the language of pre-constitutional administrative law the functionsof the CCMA would have been called 'quasi-judicial' administrative functions, and wouldthus have been subject to the principles ofadministrative justice of the day. He concludedthat in the language of the current administra-tive law regime, 'a commissioner conducting aCCMA arbitration is performing an administra-tive function.' (para 88)

Navsa AJ then made an important argumenta-tive step and said that while section 33(1) ofthe Constitution requires administrative actionto be lawful, reasonable and procedurally fair,and section 33(3) required national legislationto give effect to this right, '[n]othing in section33 of the Constitution precludes specialisedlegislative regulation of administrative actionsuch as section 145 of the LRA alongside gen-eral legislation such as PAJA. (paras 89 and91) Section 145 of the LRA amounts to nation-al legislation for the purpose of section 33(3) of

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the Constitution in respect of 'administrativeaction' within the specialised field of labour law(para 89). Even though the definition of 'admin-istrative action' in PAJA is 'extensive' and wasintended to 'cover the field' (para 90, referringto Minister of Health and Another NO v NewClicks South Africa (Pty) Ltd and Others(Treatment Action Campaign and Another asAmici Curiae) 2006 (2) SA 311 (CC) at para95), there is nothing to suggest that there are'administrative actions' that fall outside thescope of PAJA. Navsa AJ referred to O'ReganJ's judgment in Bato Star Fishing (Pty) Ltd vMinister of Environmental Affairs and Others2004 (4) SA 490 (CC) at para 25, where sheintimated that there are 'causes of action forjudicial review of administrative action that donot fall within the scope of PAJA' (quoted atpara 92). Navsa AJ concluded that while PAJAis a codification of the common-law grounds ofreview, it is not to be regarded as the exclusivebasis of legislative review. In this sense, sec-tion 145 of the LRA provides a legislative basisfor the review of administrative actions that donot fall within the ambit of PAJA.

Navsa AJ then gave several reasons thatCCMA decisions do not fall within the ambit ofPAJA, despite the fact that they amount toadministrative actions (from paras 94-103).These reasons included the fact that PAJA andthe LRA lay out different procedures on review,including different time-periods within whichreview proceedings must be instituted; the factthat if section 6 of PAJA were to apply to thereview of decisions of the CCMA the exclusivejurisdiction of the Labour Court in this regardwould be negated, since the High Court wouldhave concurrent jurisdiction in this field; thefact that the LRA and PAJA set out significant-ly different remedies; and the fact that section210 of the LRA explicitly provides that in casesof legislative conflict with other laws, the provi-sions of the LRA will prevail.

Section 33 of the Constitution requires admin-istrative action to be lawful, reasonable andprocedurally fair. Having found that CCMAdecisions are administrative action for the pur-poses of section 33 of the Constitution but arenot subject to control by PAJA, Navsa AJ con-cluded that CCMA decisions must neverthelessbe lawful, reasonable and procedurally fair. Asnational legislation giving effect to the right tolawful, reasonable and procedurally fair admin-

istrative action, section 145 of the LRA had tobe read to ensure that administrative action bythe CCMA is lawful, reasonable and procedu-rally fair (para 105). The grounds of review ofCCMA decisions set out in section 145 of theLRA must therefore be read to include reviewon the basis of reasonableness. 'To sum-marise', Navsa AJ said,

'Carephone held that section 145 of the LRA wassuffused by the then constitutional standard thatthe outcome of an administrative decision shouldbe justifiable in relation to the reasons given for it.The better approach is that section 145 is now suf-fused by the constitutional standard of reason-ableness. That standard is the one explained inBato Star: Is the decision reached by the commis-sioner one that a reasonable decision-makercould not reach? Applying it will give effect not onlyto the constitutional right to fair labour practices,but also to the right to administrative action whichis lawful, reasonable and procedurally fair.' (para110)

On the facts, Navsa AJ held that the decisionreached by the CCMA commissioner in thiscase was one that a reasonable decision-maker could have made, and the decisionshould not have been set aside by the SCA(para 119).

Ngcobo J disagreed with Navsa AJ's conclu-sion because he took a different approach tothe issues. This difference is dealt with below.Before investigating Ngcobo J's approach it isnecessary to identify two concerns that flowfrom the terms of Navsa AJ's judgment. Thefirst has to do with bypassing the provisions ofPAJA. The Constitutional Court has said on anumber of occasions that where national legis-lation gives effect to constitutional rights, a per-son must asset constitutional rights thoughreliance on the provisions of the legislation. Alitigant cannot seek to circumvent the require-ments set out by legislation by relying directlyon the constitutional provision (see for exampleSouth African National Defence Union vMinister of Defence and Others 2007 (8) BCLR863 (CC) at para 51, New Clicks at paras 96and 436). It might appear that Navsa AJ'sapproach disregards this principle by allowinga litigant seeking review of a CCMA arbitrationdecision to rely on section 33 without relying onPAJA - but of course where a litigant does sohe or she must nevertheless rely on section145 of the LRA. Direct reliance on section 33 ofthe Constitution is not countenanced by Navsa

9

AJ's approach since section 145 of the LRA isdetermined to be, alongside PAJA, nationallegislation that gives effect to the right to lawful,reasonable and procedurally fair administrativeaction.

The second concern is less easily disposed of.In New Clicks Chaskalson CJ suggested that ifthe definition of 'administrative action' in PAJAexcluded from its ambit a decision that fell with-in the purview of 'administrative action' for pur-poses of section 33(1) and (2) of theConstitution, then PAJA's definition of 'adminis-trative action' would have been unconstitution-al (New Clicks, paras 119-126). This suggeststhat the definition of 'administrative action' inPAJA is co-extensive with the definition of'administrative action' in section 33 of theConstitution. Navsa AJ's decision contem-plates a category of administrative actionswithin labour law that fall outside PAJA's defini-tion of 'administrative action'. It is not clear howthis view to be to be reconciled withChaskalson CJ's statement in New Clicks.

(d) Ngcobo J's judgment Ngcobo J did not agree with Navsa AJ's con-clusion that the conduct of CCMA arbitrationproceedings constitutes administrative actionwithin the meaning of section 33 of theConstitution (para 163). Ngcobo J's reason forthis finding was primarily that the arbitrationproceedings of the CCMA are judicial ratherthan administrative in nature. He set out hisstarting point, and the approach he adopted toresolving the question, thus:

'CCMA commissioners arbitrate over those dis-putes which, under the LRA, require arbitration.The CCMA is an entity created by the LRA anddesigned to fulfil the objectives of the LRA. It per-forms a public function by, among other things,providing an infrastructure for resolving labour dis-putes. It is therefore an organ of state within themeaning of section 239(b)(ii) of the Constitutionwhich exercises public power in terms of the LRA.

There can be no question therefore that whenCCMA commissioners conduct arbitration pro-ceedings, they perform a public function which isto resolve labour disputes. They therefore exer-cise public power under the auspices of theCCMA. COSATU and the employer therefore cor-rectly accepted that the conduct of an arbitrationby a CCMA commissioner is an exercise of publicpower. But does the conduct of an arbitration con-stitute administrative action? This question mustbe answered in the light of the test for administra-tive action.' (paras 200-201, footnotes omitted)

Referring to the same paragraph in the SARFUjudgment that Navsa AJ referred to, Ngcobo Jpointed out that in determining whether anaction is an administrative action what mattersis not the functionary, or the person exercisingthe function, but the nature of the function thepublic official performs (para 203). Disagreeingwith both NAvsa AJ and the academic opinionshe referred to, Ngcobo J described proceed-ings before the CCMA as 'in the nature of liti-gation' (para 207). He stated:

'CCMA arbitrations bear all the hallmarks of a judi-cial function in that there is a lis between theemployer and a worker in which a tribunal is calledupon to apply a recognised body of rules in a man-ner consistent with fairness and impartiality. Theadjudication deals primarily with rights of workersand employers. CCMA commissioners are clothedwith virtually all the powers that presiding officersin a court of law have, including the power to makefindings of contempt of the commission. The soletask of a commissioner in an arbitration hearing isto find facts and then apply the provisions of theLRA. In my view the process of factual and legalevaluation involved in deciding whether the dis-missal was for a fair reason and to issue an awardis clearly judicial in nature.' (para 208, footnotesomitted)

Ngcobo J sought support for this conclusion onthe fact that the functions that are performed byCCMA commissioners may be performed bythe Labour Court (para 217). To characterise afunction as 'administrative' when it is per-formed by the CCMA and 'judicial' when it isperformed by the Labour Court, Ngcobo J said,is to draw a distinction based on the identity ofthe functionary - a distinction the possibility ofwhich the Constitutional Court ruled out inSARFU. Ngcobo J went further, to point outthat while the CCMA may perform administra-tive functions on occasion, it is important to'draw a line between its administrative func-tions on the one hand and the adjudicativefunctions performed by the commissioners onthe other hand' (para 238). Where CCMA com-missioners sit as 'independent and impartial tri-bunals as contemplated by section 34' of theConstitution, section 33 of the Constitution hasno application:

'[T]he CCMA is an independent and impartial tri-bunal contemplated in section 34 of theConstitution. It resolves disputes concerning unfairdismissal which are disputes capable of beingdecided by the application of the LRA. Although

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the CCMA, like the Labour Courts, is created bystatute which also determines the nature andextent of its powers, its power to decide disputesconcerning unfair dismissals derives from section34 of the Constitution. The determination of dis-putes capable of being decided by the applicationof law is not confined to courts of law, it may bedone by another independent and impartial tribu-nal. As the Labour Appeal Court pointed out inCarephone, the arbitration of labour disputes byan independent body, the CCMA, is permissible interms of section 34 of the Constitution. The actionof CCMA commissioners in deciding unfair dis-missal disputes cannot, in my view, be charac-terised as the implementation of legislation. Nordoes this action amount to administration. Theaction performed by commissioners in resolvingunfair dismissal disputes is clearly a judicial func-tion. This function cannot therefore be said to con-stitute administrative action within the meaning ofsection 33.' (para 215, footnotes omitted)

Ngcobo J therefore concluded that it is inap-propriate to import the requirements of admin-istrative justice - lawfulness, reasonablenessand procedural fairness - into review proceed-ings in terms of section 145 of the LRA. Rather,review of CCMA decisions in terms of section145 of the LRA should be confined to thegrounds of review laid out in section145(2)(a)(i), (ii) and (iii). These paragraphsallow review where a commissioner has com-mitted misconduct in relation to his duties as anarbitrator, has committed a gross irregularity inthe arbitration proceedings, or has exceededthe powers of the commissioner. Ngcobo Jthen considered the meaning of these groundsof review. Although it was alleged in this casethat the commissioner's decision fell foul of allthree of these grounds of review (para 256),Ngcobo J took the view that only the meaningand scope of gross irregularity and acting inexcess of powers conferred needed to be con-sidered (para 257).

Ngcobo J's approach to the meaning of 'grossirregularity' (paras 258-28) does not focus oninterpreting the term itself. Rather, Ngcobo Jimports an understanding of fairness into theterm. He begins by noting that the functions ofCCMA commissioners in arbitration proceed-ings aount to the exercise of public power, andare 'therefore subject to the constitutional con-straints applicable to the exercise of publicpower.' (para 260) One of these constraints, asNgcobo J points out earlier, is the rules of law(para 232) A complaint based on a 'gross irreg-ularity' must, however, go to the method orconduct of the proceedings, and not the result

of the proceedings (para 265). Nevertheless,there is an aspect of engagement with the rea-soning of the commissioner:

'Determining whether the commissioner has com-mitted a gross irregularity will inevitably require thereviewing court to examine the reasons given forthe award. In doing so the reviewing court must bemindful of the fact that it is examining the reasonsnot to determine whether the conclusion reachedby the commissioner is correct but whether thecommissioner has committed a gross irregularityin the conduct of the proceedings.' (para 265)

A fair hearing, Ngcobo J goes on, lies at theheart of the rule of law. Further, CCMA arbitra-tions are required to be 'fair public hearings'since they are independent and impartial tri-bunals for the purposes of section 34 of theConstitution (para 266). Ngcobo J concludedthat where a CCMA commissioner fails to haveregard to material facts, or 'fails to apply his orher mind to a matter which is material to thedetermination of the fairness of the sanction', itcannot be said that the requirement of fairnesshas been met. Such a failure

'prevents the aggrieved party from having its casefully and fairly determined. This constitutes agross irregularity in the conduct of the arbitrationproceedings as contemplated in section145(2)(a)(ii) of the LRA.' (para 268, footnotes omit-ted)

In regard to review on the basis that a com-missioner has exceeded his or her powers,Ngcobo J adopted something akin to the'symptomatic unreasonableness' test familiarto common-law review. He held that the legis-lature could not have intended to confer onCCMA commissioners the power to make arbi-tration awards that are 'manifestly unfair.'Where they do so, he reasoned, they musthave exceeded their powers:

'As public officials who exercise public powers,commissioners may only make those awardswhich are consistent with their obligations underthe LRA and the Constitution. Where a commis-sioner renders an award that is inconsistent withhis or her powers conferred on a commissioner bythe LRA, in my view, the commissioner exceedshis or her powers and the award falls to bereviewed and set aside under section 145(2)(a)(iii)of the LRA. Given the constitutional right to fairlabour practices, the provisions of section 188read with items 1, 2 and 7 of the Code, an awardwhich is manifestly unfair to either the employer oremployee can hardly be said to be consistent withthe powers conferred upon a commissioner to

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make an award that is fair. In effect, if a commis-sioner fails to determine the dispute fairly, he orshe is in breach of the statute that is the source ofhis or her power to conduct the arbitration and isalso in breach of the doctrine of legality, which is aconstitutional constraint upon the exercise of hisor her powers. This conduct on the part of thecommissioner is ultra vires, that is, beyond powersconferred on the commissioners as contemplatedin section 145(2)(a)(iii).' (para 276)

Although Ngcobo J finds that CCMA decisionsare not administrative action for the purpose ofsection 33 of the Constitution, and that therequirements of administrative justice shouldnot be applied in the review of CCMA arbitra-tion decisions, he nevertheless imports ele-ments of fairness and reasonableness intosection 145 review of CCMA decisions. Giventhe similarity of the standards against whichNgcobo J and Navsa AJ ultimately assessedthe commissioner's decision in this case, it isunsurprising that Ngcobo J concurred in theorder made by Navsa AJ.

(e) O'Regan J's judgment O'Regan J concurred in Navsa AJ's conclu-sion, but her judgment emphasised a differentjustification for that conclusion. Her judgmentwas in large a response to that of Ngcobo J,and turned on a criticism of two distinctions thatNgcobo J sought to make in his judgment.

The first of these distinctions was between theambit of application of section 33 and section34 of the Constitution. In O'Regan J's view, oneof the reasons that Ngcobo J concluded theadjudicative functions of the CCMA do not con-stitute administrative action is that as inde-pendent and impartial tribunals they are moreproperly governed by section 34 of theConstitution:

'Ngcobo J's reasoning is that the task is not admin-istrative because there is a distinction to be drawnbetween "administrative" and "judicial" tasks. Hereasons that where judicial tasks are performed byindependent and impartial tribunals, the perform-ance of those tasks does not fall within the scopeof administrative action in section 33 of theConstitution. My approach is different. While inde-pendent and impartial tribunals may perform adju-dicative tasks, it does not automatically follow thattheir functions are not within the contemplation ofsection 33. Nor does it necessarily follow thatbecause independent and impartial tribunals aregoverned by section 34, they are not governed bysection 33.' (para 126)

O'Regan J took the view that whether a deci-sion of the CCMA was administrative action ornot had to be decided by engaging with thenature of the decision itself, and could not bedetermined simply by asserting that becausethe adjudicative functions of administrative tri-bunals are governed by section 34 of theConstitution they are not governed by section33(para 135).

The second distinction on which Ngcobo Jrelied lies between adjudicative acts andadministrative acts. In emphasising that it is thenature of the function that is important to deter-mining the applicability of principles of adminis-trative justice rather than the identity of thefunctionary, Ngcobo J ignored, in O'Regan J'sview, the substantive nature of CCMA deci-sions. His approach, she reasoned, was redo-lent of the classificatory approach to adminis-trative law according to which the principles ofadministrative justice where held to governonly those acts that could be classified as'purely administrative' or 'quasi-judicial':

'In our pre-constitutional order, the classification offunctions in administrative law proved to be anunsatisfactory basis for determining the scope ofjudicial review and it was finally and firmly rejectedby the courts. I am concerned that if we under-stand section 33 and section 34 to be mutuallyexclusive constitutional provisions, we may end upwith a formalist jurisprudence based on a distinc-tion between "administrative" in section 33 and"judicial" or "adjudicative" decisions by tribunalsgoverned only by section 34 which is at odds withthe substantive vision of our Constitution.' (para135, footnotes omitted)

O'Regan J preferred a view that was 'basedon a substantive understanding of section33', and agreed with Navsa AJ that deci-sions of the CCMA are to be understood asadministrative actions within the meaningof section 33.(f) Sachs J's judgment Sachs J concurred in both Navsa AJ's judg-ment and Ngcobo J's judgment, despite thefact that the judgments disagreed with eachother (para 146). On a close reading, though,Sachs J does not give any support to NavsaAJ's conclusion that decisions of the CCMAamount to administrative action for purposes ofsection 33 of the Constitution. Rather he finds,as Ngcobo J does, that review of CCMA deci-sions in terms of section 145 of the LRA mustextend further than the very narrow grounds of

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review set out in section 145(2)(a) to includevalues of reasonableness and fairness. SachsJ summed up his position as a synthesis of theunderlying premises of the other two judg-ments:

'[I]n an open and democratic society based onhuman dignity, equality and freedom, it would beinappropriate to restrict review of the commission-er's decision to the very narrow grounds of proce-dural misconduct that a first reading of section145(2) would suggest; at the same time, thelabour-law setting, requiring a speedy resolution ofthe dispute with the outcome basically limited todismissal or re-instatement, makes it inappropriateto apply the full PAJA-type administrative reviewon substantive as well as procedural grounds; andto the extent that the right to just administrativeaction is involved, the values of fair dealing thatunderlie section 33 of the Constitution must berespected. I accept that inasmuch as the right to afair labour practice is at the centre of the analysis,the outcome of the arbitration process must not falloutside the bounds of reason; to accept it doing sowould hardly represent a fair outcome. Finally,acknowledging the adjudicatory element thatimplicates the right to a fair hearing under section34, I would hold that a fair hearing demands thatat the very least there be some reasonably sus-tainable fit between the evidence and the out-come.' (para 158, footnotes omitted)

The form of reasoning Sachs J adopts incom-ing to the conclusion that values of reason-ableness and fairness should inform review interms of section 145 is similar to that of NgcoboJ. Sachs J does not conclude, as Navsa AJand O'Regan J do, that CCMA decisionsshould be reviewed against the standards oflawfulness, reasonableness and proceduralfairness because they constitute administrativeaction. He concludes that CCMA decisionsshould be reviewed against the values or rea-sonableness and fairness because that is what'an open and democratic society demands.'(para 158) Sachs J gives no consideration tothe question of whether CCMA arbitrationaward amount to administrative action as con-templated by section 33 of the Constitution,and as a result, Sachs J cannot be said to haveconcurred in Navsa AJ's finding in this regard.

(g) Conclusion While the judgments in this matter are plentifuland diverse, and the Constitutional Court'sdecision is by no means unanimous in its rea-soning or indeed its conclusions, there is oneprinciple that emerges clearly from theConstitutional Court's decision. This is that the

narrow grounds for the review of CCMA arbi-tration decisions set out in section 145(2)(a) ofthe LRA must be supplemented by considera-tions of fairness and reasonableness. In thisregard, the Constitutional Court has trod a mid-dle ground between the earlier decisions of theLabour Appeal Court in Carephone and theSupreme Court of Appeal in RustenburgPlatinum. The Carephone decision held thatsection 145 of the LRA is suffused by principlesof administrative justice and allows review ofCCMA decisions on grounds of rationality. TheSCA held in the judgment on appeal in thismatter that CCMA decisions constitute admin-istrative action in terms of PAJA, and thatreview in terms of section 145 must conse-quently proceed on the basis of all the groundsof review set out in section 6(2) of PAJA. Theprinciple that emerges from the ConstitutionalCourt is that review of CCMA decisions interms of section 145 is not limited to the narrowgrounds listed in section 145(2)(a) of the LRA,but includes review on the basis of fairness andreasonableness. Although Navsa AJ andNgcobo J reached this conclusion following dif-ferent routes of reasoning, there can be nodoubt that this is the binding principle toemerge from the Constitutional Court.

The Constitutional Court did not resolve theissue of whether CCMA decisions constituteadministrative action in terms of section 33 ofthe Constitution, however. Five judges heldthat it does, four judges held that it does not,while the tenth judge seems to have agreedwith the latter four - although this agreement isequivocal. While nothing turned on this dis-agreement in the present case, the importanceof deciding whether CCMA decisions areadministrative action or not lies in the standardof review that will be applied. Section 33requires administrative action to be lawful, rea-sonable and procedural fair. There is a greatdeal of jurisprudence regarding these require-ments and their application as standards ofreview. Ngcobo J's approach, in avoiding sec-tion 33's standards of review, sets up therequirements that each party must have his orher case 'fully and fairly determined' and thatresults must not be 'manifestly unfair' (paras268 and 276). It is, however, far from clearwhat considerations must or can be taken intoaccount in applying these novel standards. Theclearer and jurisprudentially established stan-dards of review set by section 33 will prove

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more amenable to application than the stan-dards of review Ngcobo J favours. Indeed, itmay well be that the considerations that under-lie the application of section 33's standards ofreview inform Ngcobo J's approach anyway. Inthis sense, it is perhaps of little consequencethat the Constitutional Court has not firmlydecided whether CCMA arbitration awardsamount to administrative action or not.

PROMOTION OF ADMINISTRATIVE JUS-TICE ACT 3 OF 2000 (PAJA)

Section 1 - Administrative action defined

It is by now well-established in our law thatstate tender processes by which governmentdepartments and organs of state tender forgoods and services from the public are admin-istrative actions as contemplated in section 33of the Constitution and defined in section 1 ofPAJA. Section 217(1) of the Constitutionrequires that:

'When an organ of state in the national, provincialor local sphere of government, or any other insti-tution identified in national legislation, contracts forgoods or services, it must do so in accordancewith a system which is fair, equitable, transparent,competitive and cost-effective.'

Section 217(2) provides that subsection (1)does not prevent organs of state from pursuingprocurement policies which aim to advancepeople or categories of people disadvantagedby previous unfair discrimination, and subsec-tion (3) requires national legislation to pre-scribe a framework within which policiesreferred to in subsection (2) are to be carriedout. The Preferential Procurement PolictFramework Act 5 of 2000 (the PPPF Act) is thislegislation.

The Supreme Court of Appeal (SCA) held inUmfolozi Transport (Edms) Bpk v Minister vanVervoer [1997] 2 All SA 548 (SCA) that theaward of a state tender amounts to an admin-istrative action (552j-553a), while in TransnetLtd v Goodman Brothers (Pty) Ltd 2001 (1) SA853 (SCA) the SCA held that calling for anadjudicating tenders also amounts to adminis-trative action (para 7). In Olitzki PropertyHoldings v State Tender Board 2001 (3) SA1247 (SCA) the SCA held that administrativejustice rights are applicable to a tender processand tender processes must comply with the

requirements of administrative justice. Thereare numerous High Court decisions that followthis line, many of which are reported in earliereditions of this Newsletter (see for exampleDarson Construction (Pty) Ltd v City of CapeTown and another [2007] 1 All SA 393 (C)reported in the 8th Edition, MEC for Roads andPublic Works, Eastern Cape, and Another vIntertrade Two (Pty) Ltd 2006 (5) SA 1 (SCA)reported in the 7th Edition, Chairperson:Standing Tender Committee and others v JFESapela Electronics (Pty) Ltd and others [2005]4 All SA 487 (SCA), Compass Waste Services(Pty) Ltd v Northern Cape Tender Board andothers [2005] 4 All SA 425 (NC) and Jicama 17(Pty) Ltd v West Coast District Municipality2006 (1) SA 116 (C) reported in the 6thEdition).

Two judgments reported in this Edition of theNewsletter, however, dispose of challenges totender processes without reference to PAJA(Minister of Social Development and othersv Phoenix Cash & Carry - PMB CC [2007] 3All SA 115 (SCA) (see below 'Section 6 -Grounds of review') and Tirhani Auctioneers(Gauteng) (Pty) Ltd v Transnet Ltd andanother [2007] 3 All SA 70 (W) (see below'Section 6 - Grounds of review')). Instead, thevarious parties and the courts before whichthey appeared relied on the provisions of sec-tion 217 of the Constitution and the PPPF Actdirectly, without referring to PAJA. Although thePPPF Act does not establish grounds ofreview, the judgments found administrativeactions unlawful, apparently on a common-awunderstanding of unlawfulness, on the basis ofnon-compliance with the requirements of thePPPF Act. This approach, in light of theConstitutional Court's comments in the recentcase of Fuel Retailers Association of SouthernAfrica v Director-General EnvironmentalManagement, Department of Agriculture,Conservation and Environment, MpumalangaProvince and Others 2007 (10) BCLR 1059(CC ) (reported in the 8th edition of thisNewsletter), is to be discouraged. TheConstitutional Court made it clear in its judg-ment that administrative challenges to adminis-trative actions must come through the door ofPAJA even where the action complainedagainst is in contravention of a statutory provi-sion. In the Fuel Retailers case the legislationconcerned was the EnvironmentalConservation Act 73 of 1989 (ECA). TheCourt's treatment of the ECA in the following

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paragraphs applies equally to the PPPF Act:.

'In Bato Star [Bato Star Fishing (Pty) Ltd v Ministerof Environmental Affairs and Others 2004 (4) SA490 (CC) at para 25] this Court held that "[t]hecause of action for the judicial review of adminis-trative action now ordinarily arises from PAJA, notfrom the common law as in the past." Section 36of ECA does no more than to provide for thereview of decisions of environmental authorities.The grounds upon which decisions under ECAmay be reviewed are those set out in PAJA. Theclear purpose of PAJA is to codify the grounds ofreview of administrative action. The fact that sec-tion 36 of ECA allows a person whose interestsare affected by a decision of an administrativebody under ECA to approach the High Court forreview, does not detract from this. The provisionsof section 36 must therefore be read in conjunctionwith PAJA which sets out the grounds on whichadministrative action may now bereviewed.'(paras 36-37, footnotes omitted)

A third judgment dealing with a challenge totender processes, also reported in this Editionof the Newsletter, did dispose of the matter withreference to PAJA (GVK Siyazama BuildingContractors (Pty) Ltd v Minister of PublicWorks and others [2007] 4 All SA 992 (D)(see below under 'Section 6 - Grounds ofreview')). Read alongside one another, it isclear that the provisions of PAJA apply equallyto all three cases. For this reason all threecases are discussed in the same section of thisNewsletter ('Section 6 - Grounds of review'),even though only one of the judgments dealsdirectly with PAJA

Union of Refugee Women and Others vDirector: Private Security IndustryRegulatory Authority and Others 2007 (4)BCLR 339 (CC)(see below under 'Section 3 - Procedural fair-ness in administrative action affecting individu-als' and 'Section 7 - Procedure on review') con-cerned a challenge to a decision by the firstrespondent to refuse to allow the registration ofcertain refugees (the second to thirteenthapplicants as represented by the first appli-cant), as security service providers in terms ofthe Private Security Industry Regulation Act 56of 2001. The primary challenge was againstthe constitutionality of section 23(1)(a) of theAct, which differentiated between South Africancitizens and permanent residents on one handand other categories of people, includingrefugees, on the other hand. The applicantssought the review and setting aside of the first

respondent's decision in the alternative to theprimary constitutional challenge. A majority ofthe Court, per Kondile AJ, decided that theimpugned section of the Act did not infringe theapplicants' rights not to be unfairly discriminat-ed against. O'Regan J and Mokgoro J wrote aminority dissenting judgment, in which LangaCJ and Van der Westhuizen J concurred,expressing the view that the impugned sectiondid discriminate unfairly against refugees. Themajority, having dismissed the constitutionalchallenge, turned to whether the first respon-dent's decision amounted to an administrativeact in terms of section 1 of PAJA. The respon-dents' submission in this regard was that thefirst respondent's decision had no 'direct, exter-nal, legal effect' on the applicants and thusfailed to satisfy an important part of the defini-tion of administrative action:

'The denial is based on the assertion that the deci-sions do not have a direct external legal effect onthe applicants. The assertion is erroneous. Therefusal to register an applicant as a private securi-ty service provider is an adverse determination ofthe applicants' rights. The determination has animmediate, final and binding impact on the appli-cants, who have no connection with the Authority.The decisions therefore do have a direct, external,legal effect and constitute administrative action interms of PAJA.' (para 70)

Minister of Defence and Others v Dunn 2007(6) SA 52 (SCA) (see below under 'Section 3 -Procedural fairness in administrative actionaffecting individuals', 'Section 6 - Grounds ofreview' and 'Section 8 - Remedies'), was anappeal against a decision of Van Rooyen AJsitting in the Pretoria High Court (the judgmentis reported as Dunn v Minister of Defenceand Others 2006 (2) SA 107 (T) and is dis-cussed in the 6th Edition of the PAJANewsletter). Dunn, (the applicant in the court aquo) had initially sought the review in terms ofPAJA of the appellants' decision to appoint oneCoetzee rather than Dunn to a post advertisedwithin the South African National DefenceForce (SANDF). Considering the applicabilityof PAJA, Lewis JA said, for the Court:

'The denial is based on the assertion that the deci-sions do not have a direct external legal effect onthe applicants. The assertion is erroneous. Therefusal to register an applicant as a private securi-ty service provider is an adverse determination of

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the applicants' rights. The determination has animmediate, final and binding impact on the appli-cants, who have no connection with the Authority.The decisions therefore do have a direct, external,legal effect and constitute administrative action interms of PAJA.' (para 70)

The SANDF is of course a public sectoremployee, and the Minister's decision toappoint Coetzee to the post at issue was therea public sector employment decision. It is worthcommenting that the conclusion that theMinister's decision was an administrativeaction seems at odds with the decision of theConstitutional Court in Chirwa v Transnet Ltdand others [2007] JOL 21166 (CC) (seeabove under 'The relationship between admin-istrative law and labour law: recentConstitutional Court decisions') matter dis-cussed above. It might be thought that sincethe Constitutional Court decision was handeddown only after the judgment in this matter, thatthe Constitutional Court decision impliedlyoverrules this judgment. On the contrary, theSCA's conclusion that the Minister's decisionwas administrative action is entirely consistentwith the reasoning of the majority of theConstitutional Court, since, it must be remem-bered, the Labour Relations Act 66 of 1995(LRA) does not apply to members of theSANDF. The remedies that are available toordinary employees in terms of the LRA arethus not available to members of the SANDFsuch as Dunn. Ngcobo J's judgment in theChirwa matter, concurred in by a majority ofthe Court, held that the application of thelabour law regime to public sector employeesexcludes the application of administrative lawto public sector employment decisions (para148). Where the labour law regime does notapply, as in Dunn's case, there is thus no rea-son that administrative law does not govern thedecision, if the decision meets the otherrequirements of administrative action.

Joint Municipal Pension Fund and anotherv Grobler and others [2007] 4 All SA 855(SCA) (see below under 'Section 9 - Variationof time') is a judgment on an appeal against adecision of the Pretoria High Court. Therespondents were employed by the first appel-lant. They were members of the MunpenPension Fund, the second appellant, andwould be paid certain benefits by the Fund inthe event of retrenchment. At some point

before the respondents' were retrenched, theFund changed the rules of its pension plan byaltering the definition of the phrase 'pension-able service'. The alteration drastically reducedthe period in terms of which the respondents'retrenchment benefits would be calculated,and reduced the value of the retrenchmentbenefits they received. They approached thePension Funds Adjudicator for relief in terms ofthe Pension Funds Act 24 of 1956, but theAdjudicator decided that since the amendmenthad not yet been registered he had no jurisdic-tion to consider the complaint (paras 4-5). Therespondents then approached the High Courtseeking the review of the Adjudicator's deci-sion. Such relief was granted, and the HighCourt made an order setting aside both theAdjudicator's decision and the Fund's decisionto amend its rules. The basis of the decisionwas that rule 49 of the Fund's own rules pre-vents the amendment of rules where the effectof amendment is to diminish the value of 'anestablished benefit'. The appellants challengedthe High Court's decision on three bases: first,that the High Court's understanding of 'estab-lished benefit' was incorrect; second, that sincethe Adjudicator had no jurisdiction to decideupon the validity of the amendments, the courtequally had no jurisdiction, and thirdly, thatinsofar as the application was for review of theFund's decision and not the Adjudicator's deci-sion, the review should have been cast interms of PAJA and was outside the time limitsset out in section 7 of PAJA. The first two ofthese grounds of appeal are not relevant here.Suffice it to say that the SCA agreed with thesubmission that the Adjudicator had no juris-diction to hear the complaint, and that the HighCourt consequently had no basis in law toreview and set aside the Adjudicator's decision.The respondents had, however, made an'unqualified prayer for an order reviewing andsetting aside the decision of [the Fund's]trustees relative to the disputed amendment'(para 28). Unfortunately the SCA did not con-sider at any length the application of section 1of PAJA. It is not obvious that the secondappellant's decision would have satisfied thedefinitional requirements of 'administrativeaction' as defined in PAJA, since the Fund isnot an organ of state and exercises powersonly over its own members. Whether the pow-ers and functions the second appellant exer-cises or performs are 'public' requires someconsideration (in this regard see AAA

16

Investments (Pty) Ltd v Micro FinanceRegulatory Council and Another 2006 (11)BCLR 1255 (CC), reported in the 7th Edition ofthe PAJA Newsletter). Instead, the SCA hadonly this to say about the application of PAJA tothe case:

'In the circumstances I consider that the applica-tion to the court below was sufficiently framed toinclude review relief such as is within the ambit ofPAJA even though PAJA is not referred to.' (para28)

In Tshona v Principal, Victoria Girls HighSchool, and Others 2007 (5) SA 66 (E) (seebelow under 'Section 7 - Procedure forreview'), the applicant had been expelled fromthe school boarding hostel following allegedmisconduct and a number of disciplinary pro-cedures instituted by the school. She sought tohave those procedures reviewed and the deci-sion expelling her from the hostel set aside.The school, represented by the first respon-dent, purportedly acted at all times in terms ofthe South African Schools Act 84 of 1996.Pickering J held that the provisions of PAJAwere applicable to the matter:

'[Counsel for the respondent] concede in favour ofthe applicant that a decision by the school govern-ing body to expel a learner from a hostel wouldconstitute the exercise of a public power whichwould fall within the ambit of s 1(b) of thePromotion of Administrative Justice Act 3 of 2000and would accordingly be reviewable by the Court.In light of this concession I need say no morethereabout.' (74F-G)

Paragraph (b) of the definition of administrativeaction in PAJA provides that any decision by 'anatural or juristic person other than an organ ofstate, when exercising a public power or per-forming a public function in terms of anempowering provisions' is, when it meets theother requirements of the definition, an admin-istrative action.

McDonald and Others v Minister of Mineralsand Energy and Others 2007 (5) SA 642 (C)(see below under 'Section 7 - Procedure forreview' and 'Review in terms of theConstitution') involved a challenge to the legal-ity of regulations made by the first respondentin terms of section 38(4) of the NationalNuclear Regulator Act 47 of 1999. One of thedefences raised by the respondents was thatan application for review was premature in light

of the requirement in section 7(2) of PAJA thatan applicant exhaust internal remedies beforeapproaching a court of review. The applicantshad not themselves placed any reliance onPAJA, and it was thus only on the context of therespondents' reliance on PAJA that the courthad occasion to consider the applicability ofPAJA. Griesel J (Yekiso J concurring) said thisargument

'presupposes that the provisions of s 7(2) of thePromotion of Administrative Justice Act 3 of 2000(PAJA) are applicable to this case. However, asappears from the various judgments in the NewClicks case [Minister of Health and Another NO vNew Clicks South Africa (Pty) Ltd and Others(Treatment Action Campaign and Another as AmiciCuriae) 2006 (2) SA 311 (CC), reported in the 5thEdition of the PAJA Newsletter] it is still an openquestion whether the Minister's decision to makeregulations amounts to an administrative action forthe purposes of PAJA.' (para 25)

The judge went on to note that in the circum-stances of the case, it could not be said thatthe regulations had 'adversely affected' theapplicants (para 27). This was so because theregulations delegated to the National NuclearRegulator the power to lay down 'specificrequirements' relating to the subject matter ofthe regulations. It was these to requirementsthat the applicants objected - but since thecourt found that the power to lay down specificrequirements had been improperly delegatedto the Regulator, it was unnecessary to consid-er any of the challenges against the require-ments or whether the laying down of therequirements amounted to administrativeaction (para 21).

Section 3 - Procedural fairness in administra-tive action affecting individuals

In Union of Refugee Women and Others vDirector: Private Security IndustryRegulatory Authority and Others 2007 (4)BCLR 339 (CC) (see above under 'Section 1 -Administrative action defined' and below under'Section 7 - Procedure on review') the appli-cants raised a number of complaints againstthe first respondent's decision to refuse toallow the second to thirteenth applicants to reg-ister as private security service providers interms of the Private Security IndustryRegulation Act 56 of 2001. Section 23(1)(a) ofthe Act requires applicants for registration to beSouth African citizens or permanent residents,

17

which the second the thirteenth applicants, asrefugees, were not. Section 23(6) of the Act,however, allows people other than SouthAfrican citizens or permanent residents toapply for an exemption to the requirements ofsection 23(1)(a), which the first respondentmay consider allowing 'on good cause shown'.Kondile AJ, writing for the majority of the Court,expressed concern about the lack of guidanceand information given to the second to thir-teenth applicants in regard to applying for theexemption. The judge intimated, but was by nomeans unequivocal in stating, that this failureamounted to an infringement of rights to proce-durally fair administrative action:

'One of the problems associated with this case isthe apparent lack of information and assistanceprovided by the Authority [the first respondent] torefugee applicants in relation to their applications.The applicants submit that, at the absolute least,the respondents could and should have informedthe applicants and other refugees wishing to applyfor registration that they must submit applicationsin terms of section 23(6) if they wished to beexempt from the provisions of section 23(1)(a).This expectation is well founded in the light of theextent of refugee participation in this industry atthe time of the introduction of the regulatoryscheme. Is the provision of this information not anelement of procedurally fair administrative actionenvisaged in section 3 of PAJA?' (para 79)

As a result of this failure to provide the appli-cants with information, none of them appliedfor an exemption in terms of section 23(6)(para 84). Kondile AJ held that in these circum-stances the applicants had failed to exhaustinternal remedies in terms of the Act, and madean order requiring the respondents to allow theapplicants to apply for an exemption on termsof section 23(6).

HTF Developers (Pty) Ltd v Minister ofEnvironmental Affairs and Tourism and Others2007 (5) SA 438 (SCA) (see below under'Section 4 - Procedural fairness in administra-tive action affecting the public', 'Section 6 -Grounds of review' and 'Review under theConstitution') contains an important statementof the relationship between procedures pre-scribed for administrative actions by statutesother than PAJA. The matter concerned anapplication challenging a directive issued bythe third respondent in terms of section 31A(1)of the Environment Conservation Act 73 of1989. That section allows the Minister of theEnvironmental Affairs or any other competent

authority to direct any person to cease an activ-ity which may seriously damage, endanger ordetrimentally affect the environment. Theappellant argued that in order for the respon-dents to act in terms of section 31A, they hadfirst to comply with the procedures set out insection 32 of the Environment ConservationAct (para 10). The majority of the SCA, perCombrinck JA, held that '[t]he wording of s32(1) is clear and unambiguous - if the Ministerintends issuing a direction [in terms of s 31A]he "shall" publish a notice.' (para 12) Themajority went on:

'It is true that thus construed the procedural pre-requisites for action by the Minister under s 31Awould be more onerous than those imposed by theprovisions of the Promotion of AdministrativeJustice Act 3 of 2000 (PAJA). But, if theLegislature chose to afford a party affected by par-ticular administrative action greater proceduralprotection by means of the specific provisions ofthe [Environment Conservation] Act, those provi-sions cannot be ignored in favour of less onerousprescriptions in general legislation such as PAJA.It follows that it was intended that before a direc-tion was issued there had to be compliance with s32. There was none. The direction was thereforeinvalid.' (para 13)

Jafta JA disagreed with the majority's conclu-sion for reasons that are discussed belowunder 'Section 4 - Procedural fairness inadministrative action affecting the public'.

Minister of Defence and Others v Dunn 2007(6) SA 52 (SCA) (see above under 'Section 1 -Administrative action defined', below under'Section 6 - Grounds of review' and 'Section 8 -Remedies') was an appeal against a judgmentof the Pretoria High Court (Dunn v Minister ofDefence and Others 2006 (2) SA 107 (T), dis-cussed in the 6th Edition of the PAJANewsletter). Dunn had initially sought thereview of the Minister's decision to appoint oneCoetzee to a vacant post instead of him. Hechallenged the decision on grounds, amongothers, that it was procedurally unfair in termsof section 3 of PAJA. The SCA, per Lewis JA,began its consideration of Dunn's case onappeal by pointing out that there was no evi-dentiary support for the claims he advanced:

'Although the court below appeared to considerthat the SMS-DODI [Senior Management Services- Department of Defence Instruction] was applica-ble at the relevant time, Dunn concedes that theInterim Measures [for the Appointment and/or

18

Promotion of Top Officers] did apply. And the courtindeed found that since the appellants hadinvoked the formal placement procedures set outin the Interim Measures, Dunn had acquired cer-tain rights under them which had been breached.These included the right to participate in the selec-tion process, that the process be properly appliedand the right to uniform treatment of candidates inthe process. The process required also that prop-er submissions should be made to the board andthat the personal profile of each candidate be eval-uated by the board. The evidence ofMotumi…indicates that the requirements laiddown in the Interim Measures were fulfilled.

The high court's finding that the appellants had notmet the requirements of the Interim Measures,and thus acted in breach of s 3 of PAJA, is accord-ingly also based on the assumption that the appel-lants were conspiring against Dunn and fabricatingtheir evidence. There is, as I have said, nothing tosupport this assumption, and the contention thatthere was dishonest conduct on the part of theappellants and those involved in the procedurescould not have been based solely on the papers. Iffraud were in issue the court should have referredthe matter to oral evidence or trial. But there isnothing in the papers themselves to controvert theevidence of Motumi and Luck, and the finding onthis basis is rejected' (paras 22-3, footnotes omit-ted)

The second consideration to which the SCAturned its attention was Dunn's submission thatthe process had been unfair because he hadbeen invited to an interview which was subse-quently cancelled. Dunn claimed that the invi-tation to an interview had created a legitimateexpectation that he be heard by the placementboard (paras 27 and 30). Lewis JA consideredthe requirements for reliance on legitimateexpectation:

In South African Veterinary Council v Szymanski[2003 (4) SA 42 (SCA)] Cameron JA approved therequirements relating to the legitimacy of anexpectation explained by Heher J in NationalDirector of Public Prosecutions v Phillips [2002 (4)SA 60 (W)]. The law, said Heher J, does not pro-tect every expectation. It protects those that arelegitimate. To meet this criterion, the representa-tion made by the functionary concerned must be"clear, unambiguous and devoid of relevant quali-fication". This requirement protects public func-tionaries against the risk that their "unwittingambiguous statements may create legitimateexpectations". Heher J added that it is alwaysopen to those who rely on such statements toobtain clarification. Second, the expectation mustbe reasonable. Third, it must have been intro-duced by the decision-maker. And fourth, the rep-resentation must be one which it is competent for

the decisionmaker to make.

In President of the Republic of South Africa vRugby Football Union [2000 (1) SA 1 (CC)] thecourt said that meeting the requirement of reason-ableness depends not only on the expectation inthe mind of the person relying on it but also onwhether "viewed objectively such expectation is, ina legal sense, legitimate." In my view, Dunn'sclaim to a legitimate expectation fails on the rea-sonableness requirement. There was no repre-sentation that he was the likely candidate for thepost. There was only an invitation to attend aninterview (which could give rise to no more than aprocedural expectation of an oral hearing): at mostthe invitation might amount to a representationthat an interview might be of benefit. But it isequally likely that it would not have advancedDunn's cause. There is nothing to show that any-thing would have turned on that interview. None ofthe candidates was interviewed. There was nounequal treatment. And, as I have said, there is norequirement that interviews be conducted. Norwas there evidence of a regular practice of holdinginterviews by the seminars or placement boards, afurther factor referred to by Corbett CJ inAdministrator, Transvaal v Traub [1989 (4) SA 731(A)], and approved by the Constitutional Court inPresident of the RSA. There was no need, in orderfor the decision to be made, to have an oral hear-ing.' (paras 31-2, footnotes omitted)

Section 4 - Procedural fairness in adminis-trative action affecting the public

In HTF Developers (Pty) Ltd v Minister ofEnvironmental Affairs and Tourism andOthers 2007 (5) SA 438 (SCA) (see aboveunder 'Section 3 - Procedural fairness inadministrative action affecting individuals',below under 'Section 6 - Grounds of review'and 'Review under the Constitution'), themajority of the SCA held that the respondents'failure to comply with procedures set out insection 32 of the Environment ConservationAct 73 of 1989 rendered a direction issued bythe third respondent in terms of section 31A ofthe Act invalid. Jafta JA filed a dissentingminority opinion in which he disagreed with thereasoning of the majority. The majority, Jafta JAargued, erred to the extent that it treated therequirements of section 32 as procedures to becomplied with when administrative actionaffects an individual. Rather, Jafta JA contin-ued, section 32 is to be seen as setting out pro-cedures to be followed when proposed admin-istrative action may affect a range of as-yetunidentified people, who are then afforded anopportunity to make their concerns known to

19

pose of the CIDB Act is largely to govern theestablishment and functioning of theConstruction Industry Development Board (theBoard), whose role is to ensure 'best practice'that promotes 'procurement and delivery man-agement reform', 'improved public sector deliv-ery management' and 'national and social eco-nomic objectives including…growth of theemerging sector' in the construction industry(para 6). For this reason the CIDB Act estab-lishes a national register of contractors. Interms of the regulations promulgate in terms ofthe CIDB Act, the Board must consider whethera contractor meets certain black economicempowerment objectives and qualifies as a'potentially emerging enterprise'. A contractorthat is determined to be potentially emerging isindicated in the register by the suffix 'PE' (para11). The register reflects the capacity of eachcontractor on a rating system from 1-10, basedon the Rand value of project that each contrac-tor is equipped to handle. Similarly, the registerreflects the type of project that each contractoris equipped to undertake. The only categoryrelevant to the case was the category of 'gen-eral building works', designated by the suffix'GB' (para 12). In the present case the mini-mum rating a contractor was required to havewas 8GB, provided that in the case of a poten-tially emerging enterprise the rating was 7GB(para 16). The relevant part of the first respon-dent's invitation to tender in this case read:

In this context procedural fairness, by its verynatures, demands that its requirements be com-plied with before the performance of an adminis-trative action. This does not, however, mean thatthe hearing constitutes a prerequisite for the exer-cise of administrative power. There is, therefore,no justification for reading s 32 as if it creates aprerequisite for the exercise of the power in s 31A.'(paras 19-20)

The Tender Data went on to provide:

'The following tenderers who are registered withthe CIDB or capable of being so registered prior tothe evaluation of submissions, are eligible to havetheir tenders evaluated-(a) …(b) contractors registered as potentiallyemerging enterprises with the CIDB who are reg-istered in one contractor grading designationlower than required in terms of (a) above and whosatisfy the following criteria…' (quoted at para 72)

At the time the applicant tendered for the con-tract, its designation was 7GB (para 12). Boththe first and second respondents' case wasthat the applicant's tender was correctly reject-

the administrator. When an action affects a par-ticular person, as in the case of a directiveissued in terms of section 31A, the require-ments of section 32, setting out procedures tobe followed in relation to the general public, areinapposite. Jafta JA set out his position thus:

'The purpose of s 32 is to promote the right toadministrative justice, particularly the right to pro-cedural fairness. It prescribes the procedure to befollowed by administrative functionaries so as toafford persons who may be affected by their deci-sion a hearing before such decisions are taken.The procedure provided for is commonly known asthe notice-and-comment procedure, the invocationof which is most suitable to decisions that affectthe general public. That much is clear from whatthe draft notice is required to contain. This view isfortified by the provisions of PAJA. The notice-and-comment procedure appears in s 4 of PAJA whichdeals specifically with procedural fairness inadministrative actions which affect the generalpublic. This procedure does not feature at allunder the section dealing with procedural fairnessin actions affecting individuals (s 3).

In this context procedural fairness, by its verynatures, demands that its requirements be com-plied with before the performance of an adminis-trative action. This does not, however, mean thatthe hearing constitutes a prerequisite for the exer-cise of administrative power. There is, therefore,no justification for reading s 32 as if it creates aprerequisite for the exercise of the power in s 31A.'(paras 19-20)

Section 6 - Grounds of review

GVK Siyazama Building Contractors (Pty)Ltd v Minister of Public Works and others[2007] 4 All SA 992 (D) (see above under'Section 1 - Administrative action defined')dealt with a challenge to the tender process bywhich the first respondent awarded a contractfor the waterproofing and refurbishment of theColonial Building in Pietermaritzburg to thesecond respondent (paras 1-3). The core of thecomplaint was that the invitation to tender andthe tender document itself did not make clearthat the applicant was required to furnish cer-tain information if its tender was to meet therequirements for consideration by first respon-dent. The applicant's tender submission wasrejected on the basis that it did not meet thestipulated requirements, and was never evalu-ated on its merits. The legislative frameworkgoverning the tender process was establishedby the Construction Industry DevelopmentBoard Act 38 of 2000 (the CIDB Act). The pur-

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ed by the first respondent on the basis that itstender did not comply with the 'responsivenesscriteria' listed in the tender specifications, andthat it was for that reason not an 'acceptabletender in terms of the PPPF Act (see MorleyAJ's summary of the respondents' respectivearguments at paras 51-62). The applicant'scase was, first, that the tender specificationswere ambiguous in whether a designation of7GB or 7GB PE was required, and second, thatat the time it tendered, although it was desig-nated as 7GB, it was awaiting registration as7GB PE:

'It appears that the applicant was registered by theBoard with a contractor grading designation of7GB on the 19 October 2005. It contends that itwas in fact entitled to be registered as a potential-ly emerging enterprise from that date and its grad-ing certificate should have reflected a grading of7GB PE. When the time came for it to submit itstender it was not in possession of a certificatereflecting its true status because the Board hadnot issued such a certificate to it. According to theapplicant, the Board had promised to issue a cer-tificate reflecting the applicant's grading as 7GBPE in time for the tender closing date, but despiteenquiries from the applicant. It did not do so.

The applicant stated in its founding affidavit thatthis omission did not seriously trouble it as it wasa potentially emerging enterprise and the tenderconditions stated that potentially emerging enter-prises could have a designation of 7GB.Accordingly the applicant submitted with the ten-der the CIDB certificate, which was then in its pos-session, reflecting a 7GB grading. According tothe applicant, had the Invitation to Tender notreferred to a grade of 7GB, it would have takenmore vigilant steps to obtain from the CIDB, a cer-tificate confirming its 7GB PE status in time for theclosing date of the tender. The applicant contendsthat in all respects its tender complied with theTender Data and the other requirements forresponsiveness.' (paras 26-7)

The respondents' position was that it wasincumbent on the applicant to ensure that suf-ficient written documentation proving its statusas potentially emerging was attached to its ten-der. Accepting as a fact that the applicant wasentitled to be registered as a potentiallyemerging enterprise, Morley AJ went on:

'The submission presupposes that the right to actunder s 12(4)(b) and the right to access to ade-quate housing are reciprocal and that the formeris'It is so that the Invitation to Tender prescribedthat a CIDB certificate had to be submitted with atender. The applicant complied with this require-ment. The Invitation to Tender, however, did not

state what formalities were required in an instancewhere a tenderer was "capable" of being regis-tered as a potentially emerging enterprise, bit suchregistration had not as yet taken place. In my viewthis was also a lacuna in the Invitation to Tender.…In other words, the Tender Data did not make itclear that those tenderers who were capable ofbeing registered as a potentially emerging enter-prise, had to submit specific documentation at thetime of submitting a tender reflecting that fact. Inmy judgment, if this was to be a requirement thatcould result in a tender being held to be adminis-tratively non-responsive, despite the tendererbeing factually capable of tendering for the con-tract. The Invitation to Tender should have statedso in clear and unambiguous terms. If documentshad to be submitted to support the fact that a ten-der was capable of being registered as a poten-tially emerging enterprise, then the Invitation toTender should at least have stated what thosedocuments were.' (paras 74-5)

Continuing, the judge noted that having notstipulated any formal requirements in thisregard, 'it was hardly fair of the first respondentto reject the applicant's tender out of handbecause the applicant did not submit any doc-umentation reflecting that it was capable ofbeing registered as a potentially emergingenterprise' (para 78). The judge found in theapplicant's favour, holding that the first respon-dent's decision was reviewable on the basis ofthe following grounds of review: section 6(2)(d)of PAJA, because the first respondent's incor-rect interpretation of the tender documentsamounted to a material error of law; procedur-al unfairness (section 6(2)(c) of PAJA), in thatthe first respondent rejected applicant's tenderon the basis of criteria that were not explainedto the applicant at the time of tendering; rele-vant considerations were not taken intoaccount (section 6(2)(e)(iii) of PAJA) becausethe first respondent ignored the fact that theapplicant, despite tendering outside its tendervalue range in terms of its designation, waswithin a 'reasonable margin' of the stipulatedrange (see Regulation 25(7A) of the CIDBRegulations, quoted at para 17); and the deci-sion was 'otherwise unconstitutional or unlaw-ful in terms of section 6(2)(i) of PAJA in that, inultimately awarding the tender to a moreexpensive tenderer, the first respondentignored the constitutional requirements of com-petitiveness and cost-effectiveness set out insection 217(1) of the Constitution.

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Minister of Social Development and othersv Phoenix Cash & Carry - PMB CC [2007] 3All SA 115 (SCA) (see above under 'Section 1- Administrative action defined') was an appealagainst a decision of the Pietermaritzburg HighCourt in terms of which the first appellant'sdecision to award a contract for the distributionof food hampers to companies other than therespondent. The substance of the complaintbefore the court a quo was that the tenderspecifications set out in the call for bids werevague and uncertain. The technical evaluationcommittee, whose responsibility it was todetermine whether the bids received wereacceptable in terms of the tender specifica-tions, decided that the respondent's tender didnot meet the tender specifications and wasunacceptable. The respondent's tender wastherefore not passed on for the considerationof the Minster of Social Development. MorleyAJ, in the court a quo, affirmed that tenderspecifications must

'inform a tenderer with reasonable and sufficientcertainty of the requirements for a valid andacceptable tender. Tender documentation shouldspeak for itself. Uncertainty may result in lack ofcompetitiveness and cost-effectiveness becauseof exclusion of otherwise valid tenders. Nor does itanswer the demands of fairness in the process.'(quoted at para 16)

The SCA, per Heher JA, agreed with theseobservations, but emphasised that strict adher-ence to the formal requirements of tender doc-uments may result in unfair outcomes (para 2).The basis of the technical evaluation commit-tee's rejection of the respondent's tender wasthat it had failed to demonstrate financialresources (para 13). Clause 17.10 of the invita-tion to tender stated:

'Financial resources must be readily available(provide audited financial statements, bank state-ments, letters from the bank as proof of availabili-ty of funds)… If no such evidence is provided thebid will be invalidated.' (para 6)

Dealing with this clause, Heher JA held:

'The words in parenthesis…seem to me no morethan advisory or indicative of the various possibili-ties of proving that financial resources are readilyavailable. The examples mentioned are notintended to be cumulative or exhaustive.' (para 17)…[T]he process followed by the committee treatedeach item of evidence mentioned in clause 17 asperemptory and the whole as excluding reliance

on any not specifically mentioned. By doing so itfailed to appreciate that audited financial state-ments might reasonably be inapplicable to a smallbusiness only beginning to find its feet or to a con-sortium without a previous history.' (para 19)

Heher JA held that given the manifest merits ofthe respondent's tender, the failure of the firsttwo appellants to even consider the tenderraised serious doubt a to the credibility and reli-ability of the procurement process followed(para 23). In such circumstances it could not besaid that the prescriptions of the PPPF Act hadbeen adhered to.

NOTE: Courts have on a few occasions beenrequired to deal with challenges to the mannerin which tender committees have construed thePPPF Act's requirement to consider only'acceptable tenders'. They have approachedthe issue on the basis of PAJA, finding that amisconstrual of the statutory requirement of an'acceptable tender' amounted to a materialerror of law, reviewable in terms of section6(2)(d) of PAJA (JFE Sapela Electronics (Pty)Ltd v Chairperson, Standing Tender Committee[2004] 3 All SA 715 (C), reported in the 3rdEdition of the PAJA Newsletter). On appeal inthe JFE Sapela case the SCA decided the mat-ter on the basis of the doctrine 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.' (Chairperson: Standing TenderCommittee and others v JFE Sapela Electronics(Pty) Ltd and others [2005] 4 All SA 487 (SCA,para 11, reported in the 6th Edition of the PAJANewsletter)

Tirhani Auctioneers (Gauteng) (Pty) Ltd vTransnet Ltd and another [2007] 3 All SA 70(W) (see above under 'Section 1 -Administrative action defined') concerned achallenge to the award of a tender to the sec-ond respondent by Transnet, the first respon-dent. The applicant sought the review and set-ting aside of the decision to award the tender tothe second respondent on the grounds thatTransnet's decision to award the tender as itdid was unlawful and unfair in that it was not in

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compliance with a system that is fair, equitable,transparent, competitive and cost effective asrequired by section 217(1) of the Constitution.The applicant's primary claim, however, wasfor an interdict preventing the respondentsfrom performing in terms of the contract pend-ing the outcome of review application. MayatAJ was therefore called on to determine, interms of the common-law requirements for aninterim interdict, whether the applicant had aprima facie right to judicial review of Transnet'sdecision. The basis of the applicant's complaintwas that Transnet had awarded the tender con-tract to the second respondent despite the factthat the applicant scored better than the sec-ond respondent on a number of criteria againstwhich the tenders were evaluated. In particular,while the applicant is 100% black-owned andmanaged and scored 20 out of a possible 20points on the criterion of 'broad-based blackeconomic empowerment' during the initialassessment, the second respondent is only26% black-owned and managed and scored 16out of a possible 20 points for the same criteri-on. Despite this difference, the final assess-ment of the tenders awarded both the applicantand the second respondent a 'BEERecognition Level' of 80%, and the 'certificateof accreditation with regards black economicempowerment compliance' provided in respectof each company by a private consultant toTransnet awarded both companies 3 points outof a possible 3 in this context (paras 21-25).The applicant submitted that given the differ-ence in the black economic empowerment cre-dentials of the applicant and second respon-dent, there was no rational basis on which thetwo companies could have been awarded thesame score in regard to BEE, and that the sys-tem according to which the decision was madewas therefore not consistent with the require-ments of section 217(1) of the Constitution(para 32). Counsel for the first respondentcountered that while the Constitution requiresprocurement to be in accordance with a systemthat is fair, equitable, transparent, competitiveand cost-effective, the manner in which thesystem is implemented is a matter of policy thatmust be left entirely up to the discretion of thepublic entities concerned. The adoption of thepolicy according to which Transnet's procure-ment system was implemented, counsel forTransnet submitted, could therefore never besubjected to a rationality test (para 34). MayatAJ rejected this argument, stating that even if

the manner in which a system is implementedis a policy choice,

'one cannot escape the conclusion that the resultof the manner in which the system is implementedmust not only be fair, equitable, transparent andcost-effective, but also consistent with the otherprinciples of administrative justice.' (para 35)

The judge concluded:

'I accordingly disagree with [counsel forTransnet's] submission that the implementation ofa system as a policy choice, can never be subjectto the rationality test. For these reasons, I am ofthe view that the applicant has established a primafacie case (if not a clear case) for judicial reviewby virtue of the first respondent's unfair,inequitable and rationally unjustifiable scoring ofthe applicant and the second respondent in thecontext of exercisable voting rights of blacks.'(para 36)

NOTE: The conclusions of this judgment arecontemplated in PAJA in section 6(2)(c) (reviewfor procedural unfairness), section 6(2)(f)(i)(the action taken contravenes a law, in thiscase the requirements set out in the PPPFAct), and section 6(2)(f)(ii)(cc) (no rational con-nection to the information before the adminis-trator).

In Bluelilliebush Dairy Farming and another vMinister of Agriculture and others [2007] 3 AllSA 35 (SE) (see below under 'Section 8 -Remedies') Jansen J reviewed and set asidethe second respondent's decision (confirmedby the first respondent) on the basis of section6 of PAJA. The judge found that the decisionwas reviewable on three grounds set out inPAJA: the decision had been influenced by amaterial error of law (section 6(2)(d)), relevantconsiderations were not taken into account(section 6(2)(e)(iii)) and the decision was arbi-trary or capricious (section 6(2)(e)(vi)). Thecase concerned the amount to be paid ascompensation for the destruction of livestock interms of the Animal Diseases Act 35 of 1984.Following an outbreak of bovine tuberculosis(TB) and the introduction of measures toreduce the spread of the outbreak, several ofthe applicants' dairy cattle were destroyed. Thesecond respondent determined that the com-pensation to be paid to the applicant would bedetermined on the basis of the slaughter valueof the cattle. The applicants objected, arguingthat in terms of the relevant legislative frame-

23

work compensation should have been deter-mined on the market value of the cattle as milk-producing cows. The respondents' submissionin response was that Director: Animal Health inthe Department of Agriculture had in 1999adopted a policy to determine compensation inthe case of bovine TB on the basis of slaughtervalue. The judge found that the relevant sec-tion of the Act, section 19, read with Regulation19 of the Regulations promulgated in terms ofthe Act (quoted at 38a-j), set clear parametersto the discretion afforded the second respon-dent in determining compensation (38j-39a).Jansen J referred to a decision of the SCApointing out that slavish adherence to policymay prevent the proper application of a discre-tion:

'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.' (Kemp NO v VanWyk 2005 (6) SA 519 (SCA), reported in the 6thEdition of the PAJA Newsletter)

The judge concluded:

'The adoption of the policy in 1999 was promptedby the increase in the number of farmers and apossible increase in claims for compensation with-out due regard to the statutory provisions dealingwith compensation. The fact that the secondrespondent determined compensation in terms ofa policy which was adopted for the wrong reasonsresulted in a failure to exercise his discretion interms of section 19 and regulation 30.' (at 40e-f)

Section 6(2)(b) - mandatory or material pro-cedure or condition not complied with

HTF Developers (Pty) Ltd v Minister ofEnvironmental Affairs and Tourism andOthers 2007 (5) SA 438 (SCA) (see aboveunder 'Section 3 - Procedural fairness inadministrative action affecting individuals','Section 4 - Procedural fairness in administra-tive action affecting the public, and 'Reviewunder the Constitution') concerned a challenge

to the issuing of a directive by the third respon-dent in terms of section 31A of the EnvironmentConservation Act 73 of 1989. In terms of thesection the Minister of Environmental Affairs orany other competent authority can direct anyperson to cease an activity that may seriouslydamage, endanger or detrimentally affect theenvironment. The majority upheld the appel-lant's argument that the exercise of the powerconferred by section 31A depended on compli-ance with the procedures set out in section 32(paras 10-12). Section 32 requires a compe-tent person seeking to act in terms of section31A to issue a public notice calling for com-ments on the proposed action. In this regardthe majority found that section 32 set out mate-rial and mandatory procedures failure to com-ply with which would render the administrativeaction reviewable. Section 6(2)(b) of PAJA pro-vides that an administrative action is review-able if 'a mandatory and material procedure orcondition prescribed by an empowering provi-sion was not complied with'. Although the sec-tion was not mentioned by the majority, it isclear from the judgment that PAJA governedthe matter.

'In the present matter it is clear in my judgmentthat the applicant has not formed the requiredopinion within the meaning of s 31A of the Act. Todo so is a prerequisite to the powers conferredupon the applicant in terms of s 31A read with s 32and before the existence of that jurisdictional fact(the opinion) no rights accrue to the applicant interms of the Act'. (quoted at para 26)

Jafta JA then concluded:

'For reasons set out above, I conclude that publi-cation of a draft notice is not a prerequisite for theexercise of the power in s 31A. All that the thirdrespondent was required to do, by way of a pre-requisite, was to form an opinion that the activitiesin which the appellant were engaged were dam-aging to the environment. The evidence in thepresent case shows that such an opinion wasindeed formed prior to the issuing of the direction.'(para 27)

Minister of Defence and Others v Dunn 2007(6) SA 52 (SCA) (see above under 'Section 1 -Administrative action defined', 'Section 3 -Procedural fairness in administrative actionaffecting individuals' and 'Section 8 -Remedies') concerned a number of challengesto the first appellant's decision to appoint acandidate other than Dunn to a post in theSouth African National Defence Force(SANDF). The High Court found that the

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process set out in the SANDF's InterimMeasures for the Appointment and/orPromotion of Top Officers had not been fol-lowed, and that the decision was reviewable ongrounds set out in section 6(2)(a)(i), 6(2)(b)and section 6(2)(f)(i) of PAJA (The High Courtdecision is reported as Dunn v Minister ofDefence and Others 2006 (2) SA 107 (T) and isdiscussed in the 6th Edition of the PAJANewsletter). The essence of the High Court'sfinding, however, was that mandatory andmaterial procedures set out in the InterimMeasures had not been complied with and thatthe decision fell foul of section 6(2)(b) of PAJA(see para 24 of the SCA judgment). The appel-lants argued that the Interim Measures were'no more than policy documents' and did notfetter their discretion to make appointments orpromotion in accordance with any fair proce-dures they decide to follow (paras 25-6). LewisJA did not find it necessary to consider thisargument, however. She held on the facts thatDunn had failed to show how the respondentshad deviated from the requirements of theInterim Measures at all:

'Dunn does not show, in any event, quite how theInterim Measures were infringed: he does notpoint to any passage that requires the same boardto consider all appointments. Indeed, the InterimMeasures themselves indicate that there shouldbe different seminars for different rank levels.There was thus no infringement of s 6(2)(a)(i) nor(b) and no need to decide what the status of theInterim Measures was nor whether the Chief of theSANDF or the Minister could permit deviation fromthem. This conclusion applies also to the com-plaint under s 6(2)(f)(i) that there had not beencompliance with the empowering provision.' (para26)

Section 6(2)(c) - procedurally unfair admin-istrative action

In Minister of Defence and Others v Dunn2007 (6) SA 52 (SCA) (see above under'Section 1 - Administrative action defined','Section 3 - Procedural fairness in administra-tive action affecting individuals' and 'Section 8- Remedies'), the court a quo had found thatsection 6(2)(c) of PAJA had been infringedbecause Dunn had been invited to an interviewfor a job placement for which he had appliedwhich was subsequently cancelled. He thusargued that the principles of audi alterampartem had been violated in the denial of anopportunity to be heard. Lewis JA, for the court,

rejected this submission:

It is to be noted that s 3 of PAJA does not afford aright to "appear in person" before a decision istaken. The decision-maker may, in order to giveeffect to procedurally fair administrative action,afford a person who will be affected the opportuni-ty to be heard in person. Even where that is notthe case, the audi principle nonetheless applies: aperson in respect of whom administrative action isto be taken is entitled to a hearing and to makerepresentations. But Dunn was not denied thatopportunity. He placed information about himselfbefore the special placement board and accordingto Motumi and Luck it was considered. Althoughhe contends that not all of that information wasbefore the special placement board (becauseannexures to his curriculum vitae had becomedetached), there is nothing to suggest that theboard did not have sufficient information availableand that he was not "heard".' (para 27)

Section 6(2)(e)(iii) - Failure to take relevantconsiderations into account

In Hangklip Environmental Action Group vMEC for Agriculture, Environemntal Affairsand Development Planning, Western Capeand Others 2007 (6) SA 65 (C) (see belowunder 'Section 8 - Remedies'), the court wasrequired to consider whether a factual error onwhich the first respondent's decision to zone acertain erf for agricultural use in terms of theLand Use and Planning Ordinance 15 of 1985(C) (LUPO) rendered the decision reviewable.The fourth respondent, the owner of the erf inquestion, had applied to the third respondent interms of LUPO in order to begin abalone farm-ing operations from its land (at 69H-J). Thethird respondent issued a decision zoning theproperty as requested. This decision wasappealed in terms of LUPO to the first respon-dent by the applicant. The first respondentfound that the reasons given by the thirdrespondent for the decision were invalid. On arehearing of the matter, the first respondentnevertheless zoned the property in the sameway, thereby allowing the fourth respondent tocommence abalone farming operations andaggrieving the applicant. Turning to the appli-cable provisions of LUPO, Thring J explainedthe procedure to be followed by the firstrespondent when exercising the power con-ferred on him or her to 'zone' property:

'It is not in dispute, and I think correctly so, thatwhat is envisaged by s 14(1) of LUPO is, in thefirst place, a process by means of which the localauthority concerned "determines(s)" (Afrikaans

25

text: "bepaal") the "utilisation" of the land referredto as at 1 July 1986. "Utilisation", in relation toland, is defined in s 2 of LUPO as "the use of landfor a purpose or the improvement of land and'utilise' has a corresponding meaning". Thisprocess…entails, in my view an enquiry of a pure-ly factual nature into the purpose for and mannerin which the land referred to was actually beingused as at 1 July 1986: the process does notseem to me to require or permit the exercise of adiscretion by the local authority, or the expressionof an opinion, or an exercise in speculation. Oncethe local authority has factually "determined" the"utilisation" of the land as at the relevant date interms of s 14(1), it "grants" a zoning "permitting ofthe utilisation of the land concerned" which is the"most restrictive zoning" in terms of s 14(3). This isa separate and distinct process which may call forthe exercise of a discretion by the local authority.But this second decision cannot be validly arrivedat, in my view, unless the first step, the determina-tion of the utilisation of the land as at the relevantdate, has first been properly taken.' (at 72D-I)

The significance of the two-stage process,Thring J went on, was that failure to complywith the fact-gathering requirements of the firststage would render the exercise of the discre-tion at the second stage unlawful:

'[T]he third and first respondents were required, forthe purposes of "granting" a zoning to the fourthrespondent's land under s 14(1) and 14(3) ofLUPO, to embark on a process which comprisedtwo separate stages: first, a purely factual enquiryinto the "utilisation" of the land as at 1 July 1986;secondly, and thereafter, a choice of the zoningwhich would be in accordance with the "utilisation"of the land as it had been determined by the thirdor first respondent. The first stage of this processdid not, in my opinion, entail or permit the exerciseof a discretion by the third or first respondent; thesecond one did. The second, discretionary deci-sion could be properly made only if the first, non-discretionary, determination of the factual positionhad been properly carried out - if it had not beenproperly carried out, and the factual conclusionreached was flawed as a result, this could havethe effect of vitiating the first respondent's second(discretionary) decision. This would be becausethe latter decision was made by the first respon-dent under a misapprehension of the true factualposition which had been induced by his officials,resulting in his discretion having been trammeledand misled by false information, so that his discre-tion had not been regularly or lawfully exercised.'(80G-J)

Examining the evidence in the case, Thring Jfound that there was no basis on which it couldbe concluded that the land in question had everbeen used for agricultural purposes (79J-80G).Nevertheless, the first respondent had deter-

mined that the land had in fact been used foragricultural purposes, and proceeded to exer-cise the discretion afforded him by LUPO onthe basis of this determination. Thring J con-cluded that the first respondent's decision, rest-ing as it did on this erroneous factual determi-nation, could not stand on review (at 82D-E).He referred to the SCA decision of PepcorRetirement Fund v Financial Services Board2003 (6) SA 38 (SCA) at paras 46-7 for author-ity for the proposition that section 6(2)(e)(iii) ofPAJA can be read to accommodate review onthe basis of a mistake of fact (at 81G-82D).

Section 6(2)(f)(i) - Administrative action notauthorised by empowering provision

Qualidental Laboratories (Pty) Ltd vHeritage Western Cape [2007] SCA 170(RSA) (unreported, 30 November 2007) is ajudgment on appeal against a decision of DavisJ in the Cape High Court. That decision isreported as Qualidental Laboratories (Pty) Ltdv Heritage Western Cape and Another 2007 (4)SA 26 (C) and is discussed in the 8th Edition ofthe PAJA Newsletter. The facts of the caseappear in the judgment (paras 2-7). The caseconcerned the appellant's application forreview of a decision by the first respondent toattach conditions to a demolition permit itissued in terms of the National HeritageResources Act 25 of 1999. The appellantowned a property in Mossel Bay on which acottage (called the annex by the parties) and avilla had been built. Both structures were over60 years old and could not be demolished interms of the Act without a permit issued by thefirst respondent. The appellant made the nec-essary application. The first respondent decid-ed that the villa was of significant culturalimportance and enjoyed landmark status, anddenied permission to demolish it. The firstrespondent did grant permission to demolishthe annex, providing that the appellant submitto it the plans for proposed development forapproval. The appellant submitted its plans fordevelopment, but the first respondent did notapprove them, finding that the proposed devel-opment would obscure the villa and 'make amockery of the villa's landmark status' (para 6).The appellant nevertheless demolished theannex and began construction. Upon service ofa stop-works order on the appellant and thethreat of criminal prosecution, the appellantsought to have the first respondent's decision

26

reviewed and set aside on the basis that theAct did not confer on the first respondent thepower to attach conditions to demolition per-mits (para 8). The court noted that the appel-lant placed reliance in this regard on the princi-ple of legality:

'Any entity like the first respondent exercising pub-lic power is confined to exercising only such pow-ers as are lawfully conferred upon it - this is theprinciple of legality. See Fedsure Life AssuranceLtd v Greater Johannesburg TransitionalMetropolitan Council 1999 (1) SA 374 (CC) at 399para 56 and Pharmaceutical ManufacturersAssociation of SA: In re Ex Parte President of theRepublic of South Africa 2000 (2) SA 674 (CC) at699 para 50.' (para 9)

Reliance was not placed by the appellant onthe provisions of PAJA, but it is clear from thecourt's consideration of the respondents' objec-tion that the appellant had failed to follow theprocedures for review set out in section 7 ofPAJA (see para 22), that PAJA was applicable.The court examined section 48(2) of the Actand found it to confer a discretion on the firstrespondent to attach conditions to permissionto demolish:

'It is evident that in terms of s 48(2) the firstrespondent has a discretion insofar as the granti-ng or refusal of a permit is concerned. The firstrespondent also has a discretion regarding theimposition of any terms, conditions, restrictions ordirections when granting a permit.' (para 14)

The appellant advanced two arguments in thisrespect. The first was that the objective of thepower conferred on the first respondent wasthe preservation of existing buildings, ratherthan limitation of the development or construc-tion of new buildings. Second, the appellantargued that section 48(2) confers a discretiononly in respect of buildings that are formallyrecognised as heritage areas, sites or objectsor are formally protected in terms of the Act. Itwas common cause that neither the villa northe annex were so recognised or protected(para 13). The court, per Mlambo JA, sum-marised the appellant's submissions as fol-lows:

'It was further submitted in relation to the villa thatthe only power which the Act confers upon thefirst respondent is to protect it from alterationor demolition but that the first respondentenjoys no power to regulate any other con-struction on the property. Counsel submitted

that the imposition of the condition in the dem-olition permit was thus beyond the first respon-dent's powers. Counsel labelled the conditionas one the objective of which was to controldevelopment which he submitted was notauthorised by s 48 and was beyond the firstrespondent's power. It was further submittedthat the powers contained in s 48(2) (in termsof which the condition was imposed) whichentitle the first respondent to impose a condi-tion that design proposals be revised, are exer-cisable only in the context of control by a her-itage resources authority over the alteration ordevelopment of heritage resources whichenjoy formal protection in terms of the Actthrough the provisions referred to in paragraph13 above. In so far as the stop works order isconcerned, it is sought to be set aside on thebasis that its validity is predicated upon theeffectiveness of the condition the validity ofwhich is impugned.' (para 16)

Mlambo JA rejected both of these argumentsas inconsistent with the conservation objectiveof the Act as a whole. He concluded that theAct's 'overarching objective is the identification,protection, preservation and management ofheritage resources for posterity' (para 10). Thejudge said in light of this conclusion:

'The condition imposed by the first respondenttherefore accords with its conservation mandate interms of the Act and is directly in line with the prin-ciples of heritage resources management set outin ss 5 and 6. The imposition of the condition isalso within the parameters, not only of the Act butis consonant with the overall scheme of the Act.The first respondent's power to impose conditionsin my view is not as narrowly circumscribed ascontended for by the appellant.

I may add that the purpose and effect of the con-dition is designed to enable the first respondent toexercise a power vested in it in terms of the Actand which, as pointed out, is consonant with theoverall objective of the Act ie the conservation of aheritage resource. Therefore the condition, ratherthan being one aimed at controlling development,as contended by the appellant, was in actual facta condition with a conservation objective. It mustalso follow that, the condition having been validlyimposed, the stop works order is also unimpeach-able.' (paras 19-20)

The appeals was therefore dismissed and thedecision of the High Court upheld.

Section 6(2)(f)(ii)(cc) - Irrational decision

Thring J held in Hangklip Environmental

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Action Group v MEC for Agriculture,Environemntal Affairs and DevelopmentPlanning, Western Cape and Others 2007(6) SA 65 (C) (see below under 'Section 8 -Remedies') that the process for a decision setout in the Land Use and Planning Ordinance15 of 1985 (C) (LUPO) was a two stage one.The first stage was a fact-gathering exercise,while the second stage involved the exercise ofa discretion on the basis of the factual conclu-sions reached in the first stage. Thring J heldthat a mistake of fact in the first stage wouldvitiate the exercise of discretion at the secondstage, but he went to add that even if theprocess required by LUPO did not involve twoseparate and distinct stages, the decision inthe case before him could nevertheless bereviewed on grounds set out in section6(2)(f)(ii)(cc) of PAJA. On the evidence placedbefore him the judge held:

'I am unable to find any rational connectionbetween [the first respondent's] decision on theone hand and the information which was placedbefore him on the other, when the latter is proper-ly considered.' (at 83J-84A)

The judge held for the same reason that thedecision could be reviewed on the grounds ofunreasonableness (at 84A). The impugneddecision was accordingly set aside.

Section 7 - Procedure for review

Section 7(2) - Exhaustion of internal reme-dies

In Union of Refugee Women and Others v

nificant reason for this, however, was that therespondents had failed to provide the appli-cants with any information or guidance in thisrespect. The majority of the ConstitutionalCourt, per Kondile AJ, therefore held that theapplicants had failed to exhaust internal reme-dies as required by section 7(2) of PAJA:

'An application for exemption to the Authority is aninternal remedy still available to the applicants. Itis only fair, now that the applicants are aware ofwhat is expected as regards an application forexemption, and the Authority has the guidance ofthis judgment at its disposal when consideringexemption applications, that they be given anopportunity to so apply. Accordingly, in terms ofsection 7(2)(a) of PAJA, this Court is not calledupon to make any determination on the granting ofexemption. This decision is strengthened by thefact that the correctness or otherwise of the partic-ular administrative decisions was not pronouncedupon by the High Court. It should be added how-ever, that in considering the applications, theAuthority is obliged to do so in the light of the con-siderations relevant to "good cause" set outabove.' (para 87)

In Sechaba v Kotze and others [2007] 4 AllSA 811 (NC) (see below under 'Common-lawreview - unlawfulness') administrative lawpoints were raise by the first and secondrespondent in a counter-application to the mainapplication. The applicant had been granted a'prospecting right' by the third respondent interms of the Mineral and Petroleum RightsDevelopment Act 28 of 2002 (MPRDA). Theright pertained to land owned by the firstrespondent. The first respondent refused toallow the applicant access to his land, therebypreventing the applicant from exercising hisprospecting right, on the basis that the appli-cant had not complied with the requirements ofsection 5(4)(c) of the MPRDA in terms of whichthe right was granted. That section providesthat no person may prospect for any mineral orpetroleum without 'notifying and consulting withthe land owner or lawful occupier of the land inquestion'. It was common cause that the appli-cant had made no effort to consult with the firstrespondent before demanding access to theland in question (para 10). The applicant thenapproached the court seeking an order com-pelling the first respondent to allow the appli-cant to prospect on his land. The court (Lacockand Olivier JJ) dismissed this application, hold-ing that the applicant had failed to comply withthe statutory requirements for access to theland, and that its application was for that rea-

Director: Private Security IndustryRegulatory Authority and Others 2007 (4)BCLR 339 (CC) (see above under 'Section 1 -Administrative action defined' and 'Section 3 -Procedural fairness in administrative actionaffecting individuals') the second to thirteenthapplicants had been denied registration as pri-vate security service providers in terms section23(1)(a) of the Private Security IndustryRegulation Act 56 of 2001 because they wereneither South African citizens nor permanentresidents. Although some of the applicants hadappealed the first respondent's decision interms of the Act, none of them had applied foran exemption to the requirements of section23(1)(a) as provided for by section 23(6). A sig-

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son premature (paras 16-18).

The court then turned to the counter applica-tion, the substance of which was an allegationthat the applicant's prospecting right wasimproperly granted, was void ab initio andshould be set aside. The applicant raised anobjection in limine that the first and secondrespondent had failed to exhaust internalremedies before seeking judicial review.Section 96(1) of the MPRDA allows for internalappeal processes and judicial review of deci-sion taken in terms of the MPRDA. Section93(3) provides, however, that 'No person mayapply to the court for the review of an adminis-trative decision contemplated in subsection (1)until that person has exhausted his or herremedies in terms of that subsection.' Thecourt noted that the 'deference of review appli-cations until domestic remedies have beenexhausted' is a principle of our common lawthat is now recognised by section 7(2)(a) ofPAJA (paras 23-4). Subsection 7(2)(c) of PAJAprovides for exceptions to this principle inappropriate circumstances. At the time that thefirst and second respondents filed their count-er-application before the court, the outcome ofinternal appeal proceedings against the deci-sion of the third respondent granting the appli-cant's prospecting right was not known. Thefirst and second respondents had not exhaust-ed internal remedies, and therefore applied interms of section 7(2)(c) of PAJA for an exemp-tion from this requirement. The applicantargued that section 7(2)(c) of PAJA did notapply in light of section 96(3) of the MPRDA.The court gave this summary of the applicant'ssubmission:

'He based this submission on the maxim inclusionunius est exclusion alterius, and on the fact thatthe Legislature, in enacting the provisions of sec-tion 96 of the MPRDA, omitted any reference tosection 7(2)(c) of the PAJA when it provided, insection 96(4) of the MPRDA, that "Sections 6, 7(1)and 8 of the Promotion of Administrative JusticeAct 2000…, apply to any court proceedings con-templated in this section". And he argued that,against the background of the clear prohibition insection 96(3) of the MPRDA, the only reasonableinference is that the Legislature intended toexclude the application of subsection (2)(c) of thePAJA in matters resorting under the MPRDA.'(para 27)

The court found it unnecessary to rule finally onthis issue, since by the time the matter washeard by the court, the internal appeal in terms

of section 96(1) of the MPRDA had beenfinalised and internal remedies had in effectbeen exhausted (para 32). The court went onto point out that the provisions of section 96(3)of the MPRDA have no impact on a party'scause of action. Had the counter-applicationbeen launched before the first and secondrespondents' cause of action had arisen, thesituation would have been different, but theeffect of section 96(3) is that it 'merely providesfor a procedural deference of the remedy ofreview, and not a complete ouster thereof.'(para 34) In concluding, the court said:

'The key question is whether conditions can beimposed upon an application or demolition oralteration, or whether section 34(1) envisageseither a stark positive or a negative response to anapplication.' (at 646f)

Tshona v Principal, Victoria Girls HighSchool, and Others 2007 (5) SA 66 (E) (seeabove under 'Section 1 - Administrative actiondefined') dealt briefly with the requirement insection 7(2) of PAJA that an applicant mustexhaust internal remedies before approachinga court of review for relief. The applicant hadalleged that the proceedings by which theVictoria Girls High School, represented by therespondents, had expelled her from the board-ing hostel had been unfair. After consideringthe confusing and ambiguous argument putforward by the applicant and by counsel on herbehalf, Pickering J was satisfied in all the cir-cumstances that these proceedings had beenprocedurally fair. He concluded:

'It is accordingly not necessary to deal with [coun-sel for the respondents'] further submissions thatin the light of the applicant's deliberate failure toexhaust he internal remedies with regard toappeals she was barred in terms of s 7(2) of thePromotion of Administrative Justice Act 3 of 2000from seeking relief from this Court.' (at 81J-82A)

In McDonald and Others v Minister of Mineralsand Energy and Others 2007 (5) SA 642 (C)(see above under 'Section 1 - Administrativeaction defined' and below under 'Review underthe Constitution'), the respondents objected tothe application to review the regulations madeby the first respondent in terms of the NationalNuclear Regulator Act 47 of 1999 on the basisthat the applicants had failed to exhaust inter-nal remedies. Griesel J (Yekiso J concurring)rejected this argument on the ground, firstly,

29

that PAJA did not apply to the matter at all. Butsecondly, the judge went on:

'Even assuming s 7 of PAJA to be applicable…theprovisions of s 46(3) of the Act envisage an appealto this Court, which must be proceeded with "as ifit were an appeal from a magistrates' court to theHigh Court". In my view, this is not the kind of"internal" remedy contemplated by s 7(2) of PAJA.'(para 26)

In eThekwini Municipality v Tsogo SunKwazulu-Natal (Pty) Ltd 2007 (6) SA 272(SCA) the respondent had sought an order interms of section 8(1) of the National BuildingRegulations and Building Standards Act 103 of1977 compelling the appellant to take a deci-sion in terms of section 7(1) of the Act approv-ing or refusing to approve its application forbuilding plans. The section requires a localauthority to take such a decision within 60days. Towards the end of the period of 60 daysin respect of the respondent, the appellant senta notice to the respondent indicating that itsapplication could not be considered as it failedto comply with certain formalities. The respon-dent argued that this was an equivocalresponse that did not amount to either anapproval or a refusal to approve its buildingplans. The appellant's failure to take a deci-sion, the respondent continued, was review-able in terms of section 8(1) of the Act (in thisregard see also sections 6(2)(g) and 6(3) ofPAJA). The appellant argued that its notice tothe respondent did constitute a refusal toapprove its application and that it had made adecision. Since the decision amounted to anadministrative action, the appellant argued thatthe respondent was required to exhaust itsinternal remedies before approaching a courtseeking an order that it make a decision. TheSCA summarised the arguments as follows:

'The primary dispute between the parties in theapplication to Court was whether the appellanthad, in its letter of 28 January 2005, communicat-ed a decision to refuse to grant approval of theplanning application or whether, properly interpret-ed, the notification merely amounted to a post-ponement or avoidance of a decision…From theappellant's side it was contended that the letter inquestion contained an unequivocal refusal toapprove the plans and the only remedy open tothe respondent, once that happened, lay in theappeal provided by s 9(1). Until it had exhaustedthis "domestic remedy", so it was submitted, theCourt could not and would not entertain an appli-cation to review the appellant's decision. Suffice itto say at this stage that if the respondent's reliance

on s 8(1) is correct no question of review arisesbecause the section contains express authorisa-tion to approach a Court to compel compliancewith the duty imposed by s 7(1); if, on the otherhand, its reliance was misplaced, the respondenthas set up no alternative basis for interferencewith the decisions, such as a review.' (para 13)

Upon finding that the appellant's letter did con-stitute a decision, the SCA (per Heher JA) con-cluded that the respondent's initial applicationto the High Court had been premature:

'Once it is accepted that the decision communicat-ed to the respondent constituted a refusal toapprove, the question arises why the respondentshould have been allowed to approach the Courtdirectly as opposed to first exhausting its remedyof an appeal to the review board (the board) pur-suant to s 9…In the circumstances the Court a quoshould not, in my view, have entertained the appli-cation for the declaratory order.' (para 23)

Section 8 - Remedies

Section 8(1)(c)(ii)(aa) - Substitution

Hangklip Environmental Action Group vMEC for Agriculture, Environemntal Affairsand Development Planning, Western Capeand Others 2007 (6) SA 65 (C) (see aboveunder 'Section 6 - Grounds of review') con-cerned a finding that the first respondent'sdecision was based on a mistake of fact andthus susceptible of review. The empoweringprovision in terms of which the first respondenthad acted required the factual determination ofa certain state of affairs on the basis of whichthe discretion afforded him was to be exer-cised. Finding on the evidence presented tothe court that the first respondent had made anerror, Thring J went on to find that there wasonly one factual conclusion to which the firstrespondent could have come, and consequent-ly one decision he could have made. The cir-cumstances were in his view 'exceptional' interms of section 8(1)(c)(ii)(aa) of PAJA, justify-ing the court's substitution of the first respon-dent's order with its own:

'In the present case it is transparently clear to methat there was only one decision which the firstrespondent could properly have made on thematerial available… It has not been suggestedthat there is any further information or evidencewhich is not already before the Court which couldpossibly lead to a different result. Mountains ofpaper have already been generated by this dis-pute. There can be no good reason to burden thefirst respondent with it again. Four and a half years

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have passed since he made his decision. Furtherdelays and uncertainty should be avoided, if pos-sible. In my view no useful purpose would beserved by remitting the matter to the first respon-dent so that he could reconsider his decision:there is, in my view, as I have said, only one deci-sion which he could properly make in the circum-stances. The Court is in as good a position as heis to make it. Nor has anyone, including the firstrespondent himself, asked that the matter beremitted to him for reconsideration. I consider thatthese factors, taken cumulatively, constitute thisas an "exceptional case" for the purposes of s8(1)(c)(ii) of PAJA, and that I am consequently jus-tified, not only in setting aside the first respon-dent's decision, but also in substituting for it thedecision which I think that he ought to have made.'(at 84G-85B)

Bluelilliebush Dairy Farming and another vMinister of Agriculture and others [2007] 3 AllSA 35 (SE) (see above under 'Section 6 -Grounds of review') concerned an applicationto review the decision in terms of which thesecond respondent determined compensationto be paid the applicant for the necessarydestruction of its livestock in terms of theAnimal Diseases Act 35 of 1984.Compensation had been paid to the applicantson the basis of the slaughter value of their cat-tle, but the applicants claimed they were enti-tled to the market value of their cattle as milk-producing cattle. Jansen J found that the sec-ond respondent's decision was to be reviewedand set aside. Instead of remitting the matter tothe second respondent for reconsideration,however, the judge made an order directing therespondents to pay the applicants compensa-tion in a specific amount. He held in thisregard:

'It was submitted on behalf of the respondents thatI should not order the respondents to pay theamount claimed to the applicants but that I shouldrather order the respondents to reconsider theapplicants' application for compensation in termsof the Act and to determine the compensation onthe basis that the compensation be determined onthe fair market value of a productive dairy animal.I have considered this submission. There is, how-ever, nothing in the opposing papers filed onbehalf of the respondents to cast any doubt on thecorrectness of the applicants' figures, and in par-ticular on the valuation placed by the applicants onthe cattle slaughtered.' (at 41h-i)

Although the judgment refers to PAJA, it doesnot refer specifically to section 8(1)(c)(ii)(aa)thereof. That section allows a court, havingfound an administrative act to be reviewable,

to, in exceptional circumstances, substitute orvary the administrative action.

Section 8(1)(c)(ii)(bb) - Compensation

Moniel Holdings (Pty) Ltd v Premier ofLimpopo Province and Others [2007] 3 AllSA 410 (T) involved a claim for the payment ofdelictual damages resulting from a reviewabletender process. The plaintiff had sometime dur-ing 2003 responded to an invitation by the thirddefendant, the Limpopo ProvincialGovernment Central Procurement Committee,for the supply of coal to various provincial hos-pitals. The plaintiff's tender was rejected on thebasis that it had failed to comply with one of therequirements of the tender conditions, in that itdid not submit a copy of a public indemnityinsurance policy (at 413b-c). The third defen-dant awarded the tender to two other coal-sup-ply concerns. It subsequently emerged, how-ever, that none of the tenderers, including thesuccessful tenderers, had complied with therequirement to submit a public indemnity insur-ance policy. The plaintiff initially sought thereview of the decision in terms of PAJA. In anunreported decision delivered on 27 October2005, Van der Merwe J reviewed the decisionand set it aside, ordering that it be remitted tothe respondent (now third defendant) forreconsideration in terms of section 8(1)(c)(i) ofPAJA (see para 13.3). However, the contractfor which the plaintiff had tendered came to anend on 31 October 2005, just days after Vander Merwe J ordered that the third defendant'sdecision be set aside. The plaintiff thus hadnothing to gain from the reconsideration of thematter, and, given that Van der Merwe J did notexercise the discretion afforded him by section8(1)(c)(ii)(bb) to order the third defendant topay compensation, the plaintiff instituted aclaim for delictual damages in the amount ofR34 million 'in respect of the loss of profit whichit would otherwise have derived from the saidtenders' (para 9). The defendants excepted tothe plaintiff's case, arguing that it had no causeof action. The defendants relied largely in thisrespect on the judgment of Steenkamp NO vProvincial tender Board, EC [2006] 1 All SA478 (SCA) (reported in the 6th Edition of thePAJA Newsletter), although by the time thejudgment was delivered the ConstitutionalCourt had ruled in the matter (Steenkamp NOv Provincial Tender Board, Eastern Cape 2007(3) SA 121 (CC), reported in the 7th Edition of

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the PAJA Newsletter). Sithole AJ's judgment inthe present matter relies on the ConstitutionalCourt decision rather than the SCA decision.The Steenkamp matter can be distinguished onthe facts from this matter, though, since whilethe plaintiff here was an unsuccessful tenderer,the applicant in Steenkamp had been a suc-cessful tenderer. Sithole AJ referred to theminority judgment of Langa CJ and O'Regan Jin the Steenkamp matter in this regard:

'In my opinion, it important to know whether a par-ticular tenderer is a successful one or not, for thetwo cannot be tarred with the same brush. Theessential difference between the two lies in thefact that, depending on the circumstances of thecase, a Tender Board owes a successful tenderera legal duty not to act negligently in the adjudica-tion of the tender. As was, in my view, rightly stat-ed in the dissenting judgment of Langa, CJ andO'Regan, J in the Steenkamp case (supra):

"In our view, the notion that a successful tenderer should be entitled to recover for actual moneyspent in good faith by it in pursuance of contractual obligations is quite different to an unsuccessful tenderer being able to recover fully both profits it cannot realise as a result of an improper tender award. The former entitles an applicantto reimbursement for expenses it undertook for the benefit of the government. The latter does in a real sense constitute a 'windfall' claim, as the disappointed tenderer will not need to do anything other than litigate to put itself in the position it would have been if it had performed the contract."

In the premises, I find that in casu the plaintiff is anunsuccessful tenderer who is not owed any legalduty by the third defendant or any of the defen-dants. Besides, an unsuccessful tenderer whoconsiders the tender award to have been unlawfulor improper (as in casu) always has a remedy ofjudicial review to set aside the tender and there-after reapply if the tender is advertised… A suc-cessful tenderer, on the other hand, does not havethis remedy and is indeed a bearer of obligationsto comply with the contractual obligations it under-takes once the tender has been awarded. Theplaintiff, in casu, is definitely not a bearer of suchobligations.' (para 13.3)

The case was thus not on all fours with theSteenkamp case, and the defendants werewrong to rely on it in support of their exception.Judicial support for the exception is to befound, rather, in the decision in Olitzki PropertyHoldings v State Tender Board and Another2001 (3) SA 1247 (SCA). In dealing with aclaim that is on all fours with the claim in thiscase, Cameron JA said:

'Certainly the contention that it is just and reason-able, or in accord with the community's sense ofjustice, or assertive of the interim Constitution'sfundamental values, to award an unsuccessfultenderer who can prove misfeasance in the actualaward its lost profit does not strike me in this con-text as persuasive. As the plaintiff's claim, whichamounts to more than R10 million, illustrates, theresultant imposition on the public purse could bevery substantial, involving a double imposition onthe State, which would have to pay the successfultenderer the tender amount in contract while pay-ing the same sum in delict to the aggrieved plain-tiff. As a matter of public policy the award of suchan entitlement seems to me to be so subject tolegitimate contention and debate as to impel theconclusion that the scheme of the interimConstitution envisaged that it should be a matterfor decision by the bodies upon whom the legisla-tive duties…were imposed. In these circum-stances to infer such a remedy judicially would beto venture far beyond the field of statutory con-struction or constitutional interpretation.' (para 30,footnotes omitted)

[The applicant] does not seek the revocation of thetender awarded and its re-allocation to itself, butasserts instead that fair process, if followed, wouldhave resulted in its obtaining the award and henceclaims damages for profit lost by a denial of fairprocess. The claim thus derives from a breach offair process but it seeks to recover the equivalentof a successful outcome. Its failure to challengethe outcome in review proceedings the plaintiffexplains on the basis that its option over the build-ing did not last long enough. Leaving aside theconceptual and practical difficulties this omissionraises, the nub of the matter is that the plaintiff ineffect claims a windfall, and does so on the prem-ise that its gain has also the public dimension ofconstitutional vindication. Yet, as Ackermann Jpointed out in relation to the punitive damagessought in Fose [Fose v Minister of Justice 1997 3)SA 786 (CC)], for awards to individuals to have asalutary effect on the conduct of public officialsthey would have to be very substantial, and "themore substantial they are, the greater the anomalythat a single plaintiff receives a windfall of suchmagnitude". Not only is there an anomaly, but thegrave impact on the exchequer raises a criticalpolicy consideration, which Ackermann Jdescribed thus [para 72]:"In a country where there is a great demand gen-erally on scarce resources, where the governmenthas various constitutionally prescribed commit-ments which have substantial economic implica-tions and where there are 'multifarious demandson the public purse and the machinery of govern-ment that flow from the urgent need for economicand social reform', it seems to me it would be inap-propriate to use these scarce resources to paypunitive constitutional damages to plaintiffs whoare already compensated ..." ' (para 41, footnotesomitted)

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In concluding, Sithole AJ found that theplaintiff had failed to make out a claim inlaw and upheld the defendants' exception.

In Minister of Defence and Others v Dunn2007 (6) SA 52 (SCA) (see above under'Section 1 - Administrative action defined','Section 3 - Procedural fairness in administra-tive action affecting individuals' and 'Section 6- Grounds of review'), the SCA dealt with anappeal against a decision of the High Court(Dunn v Minister of Defence and Others 2006(2) SA 107 (T), discussed in the 6th Edition ofthe PAJA Newsletter). In the court a quo, VanRooyen AJ had found that the Minister's deci-sion not to appoint Dunn to a position in theSouth African National Defence Force wasinvalid on a number of grounds in PAJA.Instead of setting the decision aside, however,Van Rooyen AJ made an order in terms of sec-tion 8(1)(c)(ii)(bb) that the appellants (respon-dents in the court a quo) pay compensation toDunn. The order was that Dunn receive thesalary that he would have received had hebeen appointed. This, Lewis JA held on appeal,amounted to an 'effective promotion' (para 39).She went on to hold that there were no excep-tional circumstances as required by section8(1)(c)(ii) of PAJA justifying the order made byVan Rooyen AJ:

'The court considered that that prejudice lay in the"absence of administrative action that complieswith the rule of law and fairness in reaching thatdecision [to appoint Coetzee]". But it also said that"the prejudice does not lie in the result of theappointment procedure" (my emphasis) sincenon-promotion is always a possibility where thereare competing candidates for a position. If that isso, what prejudice did Dunn suffer as a conse-quence of the decision to appoint Coetzee? Nonewas shown by Dunn to exist.

Even if there were exceptional circumstances, it isimpermissible for a court to substitute its own deci-sion - in this case to give Dunn an effective pro-motion in the Defence Force - for that of theMinister. It is the Minister, in terms of the DefenceAct, who has the power to make appointments andpromotions.

If it is a monetary award that Dunn wanted then heshould have proved some loss. But he did not.Compensation was accordingly not justifiableeven had the administrative action complained ofbeen reviewable. The appeal must therefore suc-ceed: the decision to appoint Coetzee rather thanto promote Dunn was not reviewable, and the

order of the court as to the payment of compensa-tion was impermissible.' (paras 38-40, footnotesomitted)

The order of the High Court was thus setaside and replaced with an order dismiss-ing Dunn's application.

Section 9 - Variation of time

Joint Municipal Pension Fund and anotherv Grobler and others [2007] 4 All SA 855(SCA) (see above under 'Section 1 -Administrative action defined') concerned adecision by the second appellant, a PensionFund, to alter the meaning of the phrase 'pen-sionable service' in its rules. The appellantsappealed against a decision of the High Courtsetting aside this amendment on grounds, interalia, that the initial application for review shouldhave been brought in terms of PAJA within thetime frames prescribed in section 7. The basisof the appellants' argument in this respect wasthat the decision sought to be reviewed wasmade on 13 February 2002, but the reviewapplication was made to the High Court only inJanuary 2005, long after the 180 day periodafter the exhaustion of internal remedies (seesection 7(1)(a)). The reason for the delay wasthat the respondents first approached thePension Funds Adjudicator in terms of thePension Funds Act 24 of 1956, only to be toldin December 2004 that the Adjudicator had nojurisdiction to review the second appellant'sdecision. Since there were in effect no internalremedies available to the respondent, theappellants argued that the period within areview application had to be brought began on13 February 2002. The SCA disagreed, sayingthe fact that the first respondent had made agood faith effort to exhaust internal remedies,as required by section 7 of PAJA, could not beheld against him:

'[C]ounsel for the appellants remarked that areview application under PAJA was out oftime…The [second appellant's] decision sought tobe reviewed was dated 13 February2002. Quite patently Grobler and his attorney

thought that a complaint to the Adjudicator had tobe exhausted before all else, provided he hadjurisdiction. In that regard matters dragged unduly,not least because the office of Adjudicator was notfilled for some while. Initially they were advisedthat he did have jurisdiction and they awaited hisdecision. When the new Adjudicator took office his

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final response, dated 19 November 2004, was thathe had no jurisdiction. This was received byGrobler's attorney on 2 December 2004. Theapplication to the court below was launched inJanuary 2005.

PAJA requires a judicial review to be brought with-out unreasonable delay and in any case within 180days after, inter alia, exhaustion of internal reme-dies. Despite the absence in law of the supposedinternal remedy of recourse to the Adjudicator, itseems to me that the interests of justice warrant-ed the court below's decision to entertain the appli-cation.' (paras 29-30)

The SCA's comments are somewhat compli-cated by the fact that the initial application wasnot brought in terms of PAJA at all. Section 9provides that the time periods stipulated in sec-tion 7 can be varied either by agreementbetween the parties or by a court or tribunal onapplication by either party (section 9(1)). Acourt or tribunal may grant an application interms of subsection (1) 'where the interests ofjustice so require' (section 9(2)). In this case,since the review application was not broughtbefore the High Court in terms of PAJA, noapplication for variation of time was ever made.The SCA nevertheless referred to section 9 ofPAJA in condoning the respondents' delay inapproaching the court below, and applied sec-tion 9 as if an application in terms of section 9had been made.

The doctrine of legality

In HTF Developers (Pty) Ltd v Minister ofEnvironmental Affairs and Tourism andOthers 2007 (5) SA 438 (SCA) (see aboveunder 'Section 3 - Procedural fairness inadministrative action affecting individuals','Section 4 - Procedural fairness in administra-tive action affecting the public', and 'Section 6 -Grounds of review'), the appellant challengedthe validity of a notice issued by the thirdrespondent in terms of section 31A(1) of theEnvironment Conservation Act 73 of 1989. Thisprovision allows the Minister or a person dele-gated by him or her to require any person whoperforms an activity as a result of which theenvironment may be seriously damaged to

cease such an activity or to take steps to rem-edy the ill-effects of that activity. Section 21 ofthe Act allows the Minister to identify by noticeany activities which 'in his opinion may have asubstantial detrimental effect on the environ-ment'. In regulations promulgated on 5September 1997 (GN 1183), the Minister iden-tified the activities referred to in section 21.These are set out in Regulation 182. Item 10 ofthat regulation was at issue in this case. Theactivity it identified was '[t]he cultivation or anyother use of virgin ground'. 'Virgin ground' wasitself defined as 'land which has at no time dur-ing the preceding 10 years been cultivated'.The appellant submitted before the High Courtthat item 10 was concerned with agriculturalland, and did not therefore apply to land locat-ed in a proclaimed township (para 4). The Highrejected this argument, finding that the itemcould be interpreted widely enough to includeactivities other than agricultural ones (HTFDevelopers v Minister of Environmental Affairsand Tourism and Others 2006 (5) SA 512 (T) atpara 28, quoted by the SCA at para 6). TheSCA found, however, that the item failed tocomply with the rule of law and the doctrine oflegality because it was vague. It was therefore'void for vagueness' (para 8). Combrinck JA,writing for the majority, said:

'In Affordable Medicines Trust and Others vMinister of Health and Others 2006 (3) SA 247(CC) [reported in the 4th Edition of the PAJANewsletter] in para [108] Ngcobo J said the fol-lowing:"The doctrine of vagueness is founded on the ruleof law, which, as pointed out earlier, is a founda-tional value of our constitutional democracy. Itrequires that laws must be written in a clear andaccessible manner. What is required is reasonablecertainty and not perfect lucidity. The doctrine ofvagueness does not require absolute certainty oflaws. The law must indicate with reasonable cer-tainty to those bound by it what is required of themso that they may regulate their activity according-ly."As mentioned, it is an offence to undertake any ofthe s 21 identified activities in the absence of writ-ten authorisation by the Minister or other compe-tent authority (s 22(1) read with s 29(4) of the[Environment Conservation] Act. What "reason-able certainty" does the owner of land have that heis not committing an offence when he puts part ofhis property which has not been utilized for tenyears to a particular use?' (para 9)

The judge concluded by contrasting Item 10 tothe regulations that replaced it in terms of the

REVIEW IN TERMS OFTHE CONSTITUTION

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National Environmental Management Act 107of 1998, pointing out that the concept of 'virginground' was abandoned in favour of a far morecertain and clear definition of proscribed activi-ties (para 9). Since the empowering provisionin terms of which the third respondent hadacted was void for vagueness, the majority ofthe SCA held that the directive issued wasinvalid and had to be set aside.

McDonald and Others v Minister of Mineralsand Energy and Others 2007 (5) SA 642 (C)(see above under 'Section 1- AdministrativeAction defined' and 'Section 7 - Procedure forreview') concerned a challenge to the legalityof 'the Regulatory framework restricting thedevelopment of property located within a 5 kmradius of the Koeberg Nuclear Power Station'(para 1). Section 38(4) of the National NuclearRegulator Act 47 of 1999 confers on theMinister on Minerals and Energy the power tomake certain regulations. The section pro-vides:

'The Minister may, on recommendation of theboard [of the Regulator] and in consultation withrelevant municipalities, make regulations on thedevelopment surrounding any nuclear installationto ensure the effective implementation of anyapplicable emergency plan.' (quoted at para 4)

The Minister exercised this power, promulgat-ing regulations which included the followingprovision in Regulation 3:

'The regulator shall lay down, where appropriate,specific requirements relating to the control and/ormonitoring of developments within the formalemergency planning zone surrounding a specificnuclear installation, after consultation with the rel-evant provincial and/or municipal authorities.'(quoted at para 5)

The regulator, for its part, laid down require-ments aggrieving the applicants. The appli-cants argued that the Minister's sub-delegationof regulation-making power to the regulatorwas unlawful. It relied on the administrative lawprinciple delegatus delegare non potest (para8). In terms of this principle,

'a functionary entrusted with powers in terms ofempowering legislation has to exercise those pow-ers itself and may not delegate such powers to anyother body or person unless authorised to do so bythe authorising powers - either expressly or byimplication.' (para 8)

Referring to the scheme in which regulation-making power was conferred on the Minister,Griesel J (Yekiso J concurring) held:

'Having regard to the provisions of the Act present-ly under consideration, such delegation by theMinister was clearly unauthorised. Section 48 pro-vides as follows:"(1) Subject to ss (2), the Minister may delegateany power and assign any duty conferred orimposed upon the Minister in terms of the Act tothe Director-General: Minerals and Energy.(2) Any power or duty conferred or imposed uponthe Minister in terms of s 2, Ch 3 and ss…38(4)may not be delegated or assigned in terms of ss(1)"The effect of this section is clear: to the extent thatthe Minister may delegate power, she may dele-gate it only to the Director-General of herDepartment. However, the powers conferred uponher, inter alia, in terms of s 38(4) may not be dele-gated to anyone. The Act therefore contemplatesthat the Minister is the only functionary who mayexercise the power conferred upon her in terms ofs 38(4) thereof. Far from authorising the delega-tion of her powers in terms of that subsection, s48(2) expressly prohibits such delegation.' (paras11-12)

The Minister argued in response that she hadnot delegated the power to regulate, but thepower to set out 'requirements' (para 9). Thejudge rejected this argument, stating that theregulations promulgated by the Minister did notdeal with the substance of the subject matter athand. Instead, substantive matters were dealtwith in the regulator's requirements. TheMinister's argument was dismissed as 'puresemantics' (para 10).

Finally, the judge held that the process thatRegulation 3 set up was fundamentally differ-ent to that envisaged by the Act (paras 15-19).The applicants' challenge to the legality ofRegulation 3, as an impermissible delegationof power, was upheld.

Section 33 of the Constitution

Islamic Unity Convention v Minister ofTelecommunications and Others [2007] ZACC26 (unreported, 7 December 2007) concerneda challenge to the constitutional validity of sev-eral statutory and delegated legislative provi-sions. The applicant's complaint was that arange of statutory provisions and delegatedlegislation was inconsistent with rights to

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administrative justice in section 33 of theConstitution (in this regard the case is similar toZondi v MEC for Traditional and LocalGovernment Affairs and Others 2005 (3) SA589 (CC) - see the 5th Edition of the PAJANewsletter), as well as rights of access to courtin section 34 of the Constitution. The matterhas a long and varied history before our courtsthat is usefully laid out (this summary relies onparas 1-12 of the judgment). The applicantoperated a community radio station, Radio786, in terms of a community broadcastinglicence issued to it in terms of the IndependentBroadcasting Act 153 of 1993 (the IBA Act).The IBA Act also established the IndependentBroadcasting Authority (IBA) to regulate thebroadcasting industry. The IBA Act required theestablishment of the Broadcasting Monitoringand Complaints Commission (BMCC). Both theIBA Act and regulations promulgated in termsof the IBA Act by the IBA in 1995 set out thepowers of the BMCC to investigate and adjudi-cate complaints. The IndependentCommunications Authority of South Africa Act13 of 2000 (the ICASA Act) established theIndependent Communications Authority ofSouth Africa (ICASA) which largely replacedthe IBA. Certain section of the IBA Actremained in force, however, and the BMCCbecame a standing committee of ICASA. It wasnot until the Electronic Communications Act 36of 2005 repealed the remaining operative sec-tions of the IBA Act that the BMCC wasreplaced with the Complaints and ComplianceCommittee (CCC). In the context of this judg-ment, the differences between the BMCC andthe CCC are immaterial, and the two organswill be referred to here, as they were in thejudgment, interchangeably.

In 1998 a complaint was lodged with the IBA bythe fourth respondent, the South AfricanJewish Board of Deputies. The complaint wasreferred to the BMCC who decide that thecomplaint should be dealt with by way of formalhearing. The applicant, however, brought achallenge against the constitutional validity of acertain clause of the Code of Conduct forBroadcasting Services (schedule 1 to the IBAAct). The High Court set aside the BMCC'sdecision that the complaint should be dealt withby means of a formal hearing, but did notentertain the constitutional challenge to theCode of Conduct. The Constitutional Courtheld on appeal that the impugned clause was

inconsistent with rights to free speech con-tained in section 16 of the Constitution (thisjudgment is reported as Islamic UnityConvention v Independent BroadcastingAuthority 2002 (4) SA 294 (CC)). TheConstitutional Court found a certain prohibitionin Code of Conduct to be an unconstitutionalinfringement of the right to free speech con-tained in section 16(1) of the Constitution andinvalid to that extent. Following this decision,the Jewish Board of Deputies requested thatICASA investigate its complaint in the light ofthe Constitutional Court's judgment. TheChairman of the BMCC decided that the com-plaint did not warrant a hearing. This decisionwas reviewed and set aside by the High Courtat the instance of the Jewish Board ofDeputies. Malan J ordered that a formal hear-ing be convened (South African Jewish Boardof Deputies v Sutherland NO and Others 2004(4) SA 368 (W), discussed in the 3rd Edition ofthe PAJA Newsletter). The complaint was final-ly set down for hearing before the BMCC inMarch 2006. In February 2006, however, theapplicant applied to the High Court for an orderthat certain provisions of the IBA Act and theICASA Act in terms of which the complaintagainst it would be adjudicated were inconsis-tent with the Constitution and invalid. A requestthat the hearing be postponed in light of thischallenge was refused, and the BMCC handeddown its decision upholding the Jewish Boardof Deputies' complaint. That decision has beenchallenged before the Cape High Court, and areview application in that respect is pending.Nearly a year after the BMCC decision, theJohannesburg High Court declared theimpugned legislative provisions to be unconsti-tutional and invalid (Islamic Unity Convention vMinister of Telecommunications Case no06/3431, 26 April 2007, unreported). The pres-ent judgment was a judgment in confirmationproceedings in terms of section 172(2)(a) ofthe Constitution, which requires any order ofconstitutional invalidity made by a High Courtto be confirmed by the Constitutional Court.

The basis of the applicant's challenge to thevarious statutory and other provisions was thatthey violated rights to reasonable, lawful andprocedurally fair administrative action in termsof section 33 of the Constitution and the right tohave any dispute that can be settled by theapplication of law adjudicated by a fair, inde-pendent and impartial tribunal. The judgment

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holds implications both for fairness as it under-stood in terms of section 33 of the Constitution,and for the relationship between sections 33and 34 of the Constitution.

The applicant's submissionsThe applicant's constitutional complaints fellinto two broad categories. The first categoryconcerned the fairness of the procedures bywhich the BMCC and subsequently the CCCfulfilled their functions. The structure of theseprocedures, the applicant argued, as such thatthey would inevitably lead biased outcomes ora perception of bias:

'[I]t was submitted that the BMCC was the solefunctionary charged both with investigating a com-plaint and deciding whether the complaint meriteda formal hearing. The same body would then adju-dicate the complaint. The applicant contended thatan objective licensee, "charged with contraveningthe Code of Conduct", would reasonably appre-hend that the BMCC would not be impartial in theadjudication of the complaint. The impugned pro-visions, therefore, gave rise to an inherent bias,alternatively, a reasonable apprehension of bias.The investigation of a complaint by the BMCC andits referral to the same body for adjudication rep-resented an after-the-fact justification for a deci-sion already made. The impugned provisions ofthe ICASA Act were challenged on the samegrounds.' (para 29)

'On the question of impartiality, the argument onbehalf of the applicant was that a "litigant" in theposition of the applicant would reasonably appre-hend that the CCC might not be impartial becausethe CCC acts as prosecutor, in that theChairperson decides whether a complaint primafacie has merit and must formulate and provide alicensee with a charge sheet. It was submitted thatthere is a direct connection between the prosecu-tor (the Chairperson) and the decision-maker (theCCC) which gives rise to a reasonable apprehen-sion of influence or dependency. It was furthercontended that given the legal qualifications of theChairperson, a reasonable litigant would appre-hend that the other members of the CCC mighteasily form the view that a Chairperson would notrefer a complaint to the CCC unless it had sub-stance. The prosecutor (the Chairperson) isobliged, in terms of the ICASA Act, to preside atthe hearing of the very complaint that she or heprima facie found to have merit. Moreover, theChairperson has a deliberate vote and a castingvote in the event of a deadlock. Consequently, theargument proceeded, the very structure of theCCC as expressly authorised by the ICASA Act,creates a reasonable apprehension that the mem-bers of the CCC might be predisposed to decide acomplaint in a certain way. (para 37, footnotesomitted)

The Court noted that there could be no doubtthat the functions performed by the BMCC andthe CCC which succeeded it were administra-tive actions within the meaning of section 33 ofthe Constitution and section 1 of PAJA (para46). For this reason, the functions of the BMCCand the CCC had to be performed in accor-dance with the requirements of administrativejustice. Where institutional bias resulting fromthe statutory structure of the BMCC and theCCC prevented those bodies from performingtheir functions in a procedurally fair manner,the statutory structure of those bodies had tobe called into question. The applicant alsoargued that since section 34 of the Constitutionrequires any dispute that can be settled by theapplication law to be adjudicated in a 'fair pub-lic hearing' before an 'independent or impartialtribunal or forum', decision-making proceduresthat are inherently biased and unfair willinevitably be unconstitutional.

'As to fairness, it was submitted that for the rea-sons advanced in relation to the impartiality com-ponent of the section 34 right, the impugned pro-visions of the ICASA Act are such that they negatethe fairness of the procedure at the hearing. It wasargued that the ability of the CCC to hold a fairhearing was irredeemably compromised by virtueof the obligation on that body to exercise inves-tigative, prosecutorial and adjudicative powers,and that until the adjudicative power is severedfrom the former two, the CCC cannot render legal-ly valid decisions. The impugned provisions weretherefore said to be inconsistent with the fairnesscomponents of sections 34 and 192 of theConstitution.

On independence counsel submitted, in additionto the contentions made under the impartialitycomponent, that in the performance of her or hisduties of managing the work of the CCC, theChairperson selects the other members who willsit with her or him on the tribunal that hears a com-plaint. Those selected members will be dependenton the guidance and direction of the Chairpersonby virtue of her or his legal training or experience.It was accordingly contended that the impugnedprovisions violate the independence component ofsection 34 of the Constitution in that they encroachon the decision-making process of individualmembers of the CCC.' (paras 38-9)

The second category of complaint concernedthe powers of the Monitoring and ComplaintsUnit (MCU). The applicant argued that thepowers the MCU exercised had been unlawful-ly delegated to it by and ICASA:

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'The disputed paragraphs were challenged on thebasis that ICASA's purported conferral of monitor-ing, investigative and adjudicative functions on theMCU violated the principle of legality. It was con-tended that only the BMCC had the power, interms of sections 62 and 63 of the IBAAct, to mon-itor non-compliance or non-adherence bylicensees as contemplated in section 62(1).' (para31)

High Court's findingsThe High Court agreed with both avenues ofattack followed by the applicant. Van Oosten Jnoted that the offices and functions of prosecu-tor and decision-maker are distinctly separateand independent, and that in the absence ofsuch separation a reasonable suspicion of biasis unavoidable. There is no reason, he went on,that the principles underscoring 'fundamentalconcepts such as independence, impartialityand resulting fairness' should not apply withequal force to administrative bodies like theBMCC and CCC (para 32). Van Oosten J alsoheld that the conferral of investigative andadjudicative powers on the MCU breached theprinciple of legality, since in terms of the IBAAct those powers could only be exercised bythe BMCC (para 33).

Constitutional Court's findingsThe Constitutional Court began it considerationof the applicant's case by looking at the test forbias in recusal applications. The Court referredto the cases of BTR Industries South Africa(Pty) Ltd and Others v Metal and AlliedWorkers' Union and Another 1992 (3) SA 673(A) and President of the Republic of SouthAfrica and Others v South African RugbyFootball Union and Others 1999 (4) SA 147(CC) (SARFU). Those cases are authority forthe principle that a reasonable apprehension ofbias will suffice to render a procedure unfair -an applicant need not show actual bias on thepart of the decision-maker. The Court thenpointed out that those cases dealt with circum-stances different to those of the present matter:

'The present matter does not concern the recusalof a presiding officer. The applicant asserts bias ata structural level. In as much as the applicant rais-es the issue of a relationship of influence anddependency between the Chairperson of the CCCand other individual members, the argument wasthat the decision-maker (CCC) is inevitably biasedas a result of institutional factors rather than anindividual member being biased by virtue of per-sonal traits.' (para 41)

The Court accepted that in circumstanceswhere institutional bias is alleged, the test asset out in BTR Industries and confirmed by theConstitutional Court in SARFU is appropriatelyapplied (para 44).

The high-water mark of the applicant's casewas that the conferral of investigatory orinquisitorial powers as well as adjudicatorypowers on the BMCC and CCC compromisedthe fairness of the procedures by which theyfunctioned. In dealing with this argument theCourt, per Mpati AJ, considered the nature ofinvestigative powers conferred on the BMCCand CCC:

'To "investigate" or "inquire into" a complaintmeans more than simply to sit back and decide onthe complaint on an adversarial basis in the sameway as a criminal court. The term "investigate"means to "search or inquire into" or "examine",while "inquire" means to "seek knowledge of (athing) by putting a question" or to "request to betold." As counsel for the second respondent sug-gested, the BMCC was required to play an activeand inquisitorial role in determining matters beforeit. If the investigative powers that were conferredon the BMCC were understood, as they must, tohave referred to the inquisitorial role played by theBMCC, then there was nothing unconstitutionaland thus impermissible, in the arrangement. In S vBaloyi (Minister of Justice and AnotherIntervening) [2000 (2) SA 425 (CC)] this Courtconsidered the constitutionality of section 3(5) ofthe Prevention of Family Violence Act [133 of1993], which allowed for an inquisitorial process interms of which the magistrate enquired into thereasons for the accused's failure to comply with aninterdict and allowed the court to sentence him toa fine and imprisonment. This Court held that fair-ness to the complainant required that the pro-ceedings be inquisitorial in that it places-"the judicial officer in an active role to get at thetruth, which usually will be done through question-ing the accused. Fairness to the accused, on theother hand, dictates that within this format the gen-eral protection granted by the CPA should apply inmeasure similar to that available to a personcharged under s 170. Such a balancing of consti-tutional concerns leaves the presumption of inno-cence undisturbed. At most it may affect the rightto silence. The procedure involved in theMagistrate's Court in the present case did notraise this issue, nor was it an issue before us inthe confirmation. That issue would have to beresolved when it arises." (Footnotes omitted.)I mention Baloyi to illustrate that even regardingcertain aspects or instances in judicial proceed-ings an inquisitorial process is countenanced, pro-vided that fairness to the accused is assured.'(para 47, footnotes omitted)

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Mpati AJ found on a reading of the statutoryscheme that safeguards were built into thefunctioning of the BMCC and CCC to ensurethat fairness was afforded to those subject toits powers:

'Section 63(4) enjoined the BMCC, when investi-gating and adjudicating a complaint, to afford thecomplainant and the licensee a reasonable oppor-tunity to make representations and to be heard. Interms of section 63(6), both were entitled to legalrepresentation. Disputed paragraph 1.24 of theComplaints Procedures also made provision forthe licensee, where the finding was against it, tobe afforded an opportunity to make representa-tions with regard to the BMCC's recommendationsto ICASA as to what penalty, if any, should beimposed. Should ICASA consider that a heavierpenalty than that recommended by the BMCC waswarranted, the licensee would be given yet anoth-er opportunity to make representations. Section22(3)(a) provided that the Chairperson of theBMCC must be a judge of the High Court, whetherin active service or retired, a practising advocateor attorney with at least ten years' appropriateexperience, or a magistrate with at least ten years'appropriate experience. This requirement, in myview, was aimed at ensuring fairness, impartialityand independence. The Chairperson was anexperienced, legally trained person. In my view,the scheme adequately ensured fairness.' (para49, footnotes omitted)

As to the applicant's argument that the schemeinfringed section 34 of the Constitution, MpatiAJ questioned whether section 34 was evenimplicated. In doing so, the judge commentedon the relationship between sections 33 and 34of the Constitution:

'Some writers hold the view that where legislationgives decision-making powers to a tribunal whichlacks the required impartiality because of its com-position or structure, the constitutional validity ofsuch legislation would have to be determinedunder section 33(1) of the Constitution, where theissue would be whether the scheme set out in thelegislation is procedurally fair.

In this case we are not concerned with a court oflaw or with the fair resolution of social conflict, butwith a regulatory body that performed an adminis-trative function. The question is whether a consti-tutional challenge against legislation conferringinvestigative and adjudicative powers on anadministrative tribunal like the BMCC, based oninstitutional bias, can be sustained under the rightof access to court provisions of section 34 of theConstitution.

It was submitted on behalf of the first respondentthat section 34 was not implicated in this case and

that section 33 was. Counsel for the applicantargued, however, that the "dispute" was whetherthe applicant had breached the Code of Conductwhich was determined by the BMCC by the appli-cation of that Code of Conduct (a law) to the factsin relation to the complaint. The guarantees ofindependence, impartiality and fairness in section34 are not limited to a hearing before a court, butextend to a hearing before other tribunals or foraresolving disputes by the application of law. This isbuttressed, so the argument continued, by section8(1) of the Constitution which provides, inter alia,that the Bill of Rights applies to all law and allorgans of state, including the BMCC.

In view of the basis of the applicant's constitution-al challenge, it is unnecessary to express a firmopinion on this issue. It suffices to say that it isdoubtful whether section 34 is implicated in thepresent matter. Even if the complaint could becharacterised as a "dispute" the BMCC did notresolve it. The BMCC's function of investigatingand adjudicating the complaint was but the first ofa two-stage process. It was a higher authority,namely ICASA, which took the final decision. Thewriters Currie and De Waal submit on this issuethat before an administrative agency has taken afinal decision, there is no "dispute" that can beresolved by an application of law [Bill of RightsHandbook 5 ed ay 707]. This view is indeed per-suasive. Moreover, ICASA was not bound by therecommendations of the BMCC regarding thesanction to be imposed. As the record of the pro-ceedings before the BMCC was transmitted to itwith the BMCC's recommendations, ICASA could,for whatever reason, which, in my view couldinclude a disagreement with the findings of theBMCC, decide not to impose any sanction. Thefinal determination was thus the responsibility ofICASA.' (paras 52-55, footnotes omitted)

As to the applicant's final ground of complaint,that the powers enjoyed by the MCU wereunlawfully delegated to it, Mpati AJ found thatsince the MCU had not played any significantrole in the proceedings a finding of invalidityrelating to it would have no practical effect(para 61). The Constitutional Court thereforedeclined to confirm the High Court's declara-tion of constitutional invalidity.

Mazibuko v Minister of Correctional Servicesand others [2007] 4 All SA 1023 (T) deals withan application for the review of the respondentMinister's decision to refuse the applicant'srequest for medical parole. The applicant hadbeen sentenced to life imprisonment for a vari-ety of crimes, including murder, assault andarmed robbery. He applied for medical parolein light of a terminal illness and rapidly deterio-

39

rating health. There are several problems withMakhafola AJ's treatment of the matter.

First, the judge refers to section 69 of theCorrectional Services Act 8 of 1959, statingthat the provisions of that section 'are to thesame effect' as section 69 of the CorrectionalServices Act 11 of 1998. Section 69 of the 1959Act provides:

'A prisoner serving any sentence in a prison:

(a)who suffers from infectious or contagious dis-ease, or(b)whose placement on parole is expedient on thegrounds of his physical condition, or in the case ofa woman, her advanced pregnancy, may at anytime, on the recommendation of the medical offi-cer, be placed on parole by the commission, pro-vided that a prisoner sentenced to imprisonmentfor life, shall not be placed on parole, without theconsent of the Minister.' (quoted at 1026h)

The 1998 Act, however, repealed the 1959 Actin its entirety. Further, Section 69 of the 1998Act does not deal with medical parole at all. Itis rather section 79 of the 1998 Act that dealswith medical parole. That section provides:

'Any person serving any sentence in a prison andwho, based on the written evidence of the medicalpractitioner treating that person, is diagnosed asbeing in the final phase of any terminal disease orcondition may be considered for placement undercorrectional supervision or on parole, by theCommissioner, Correctional Supervision andParole Board or the court, as the case may be, todie a consolatory and dignified death.'

It is unclear from the judgment what the leg-islative framework governing the action com-plained against was. It appears as though allparties believed that the Minister was requiredin terms of section 69 of the 1959 Act to con-sent to the applicant's medical parole.However, at all material times, the 1959 Actwas not in force given its repeal by the 1998Act. Further, section 79 of the 1998 Act makesno mention of any requirement that the Ministerapprove or consent to the medical parole of aperson on medical grounds. It would appearthen that the judge based his assessment ofthe lawfulness of the conduct complainedagainst on the wrong legislation.

Second, the judge found that the respondents'refusal to release the applicant on medical

parole in circumstances where the latter hadcomplied with the requirements of the Act,'amounts to an infringement of section 33(1) ofthe Constitution' (at 1028g-h). Concluding, thejudge stated: 'I find that the refusal to releasethe applicant on medical parole, is unjust,unlawful, unreasonable and procedurallyunfair.' (at 1028h) There was, however, no dis-cussion of how or on what basis the judge con-cluded the decision was unlawful, unreason-able or procedurally unfair.

Third, as the courts have made clear on a num-ber of occasions, where section 33 of theConstitution is sought to be relied upon thethreshold inquiry must be whether the conductcomplained against amounts to 'administrativeaction'. In addition, the doorway to the rightslaid out in section 33 of the Constitution isPAJA. No mention of PAJA was made in thejudgment.

Common-law review - Unlawfulness

In South African Police Service v PublicServants Association 2007 (3) SA 521 (CC)the Constitutional Court traversed the properinterpretation to be given to the word 'may' inthe context of a regulation empowering theNational Police Commissioner to take certaindecisions. The judgment holds important impli-cations for the understanding of administrativediscretion and thus for lawfulness. The regula-tion in question, regulation 24(6) of the SouthAfrican Police Service Regulations, provides:

'If the National Commissioner raises the salary ofa post as provided under subreg (5), she or hemay continue to employ the incumbent employeein the higher-graded post without advertising thepost if the incumbent -(a)already performs the duties of the post;(b)has received a satisfactory rating in her or hismost recent performance assessment; and(c)starts employment at the minimum notch of thehigher salary range.'

The dispute between the parties revolvedaround the extent of the discretion conferredon the national commissioner by the subregu-lation. Sachs J, whose judgment together withYacoob J's separate judgment represents the

COMMON-LAW REVIEW

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majority view, summarised the positions of theparties:

'The commissioner claimed that although subreg(6) vested a discretion in him when upgrading postto allow an incumbent to remain undisturbed andenjoy a higher salary without competing for thenewly regarded post, it did not oblige the commis-sioner to do so automatically and mechanically.The police unions on the other hand insisted thatthe subregulation did not give a discretionarypower to the commissioner, but rather establishedthat the ordinary process of filling posts throughadvertisement was not to be applied in situationswhere an incumbent employee is working satis-factorily in a post which is upgraded and carries ahigher salary.' (para 3. See also the comments ofO'Regan J at para 91)

The commissioner initially approached theHigh Court seeking a declaratory order on theposition in terms of the subregulation. Thecourt favoured its view, and made an orderdeclaring that the commissioner is vested witha discretion to advertise the post or to continueto employ the incumbent without advertisingthe post (para 7). The respondent unionsappealed the judgment to the SCA, arguingthat such an interpretation of the subregulationinfringed the right to fair labour practices insection 23 of the Constitution and the right notto be dismissed unfairly in the LabourRelations Act 66 of 1995, since exercising thediscretion to advertise the post would effective-ly dismiss the incumbent (para 8). The majorityof the SCA agreed with the unions' argument,holding that where the conditions on para-graphs (a) and (b) of the subregulation are met,the commissioner has a duty to appoint theincumbent employee (the judgment is reportedas Public Servants Association v NationalCommissioner of SA Police Service [2007] 1 AllSA 363 (SCA)). The minority of the SCA dis-agreed, finding that an incumbent not appoint-ed to the regarded and advertised post couldseek to have the decision reviewed as anadministrative action (para 10). In light of thejudgment of the Constitutional Court in Chirwav Transnet Ltd and others [2007] JOL 21166(CC) (see above under 'The relationshipbetween administrative law and labour law:recent constitutional court decisions') the find-ing that a decision whether or not to appoint aperson is an administrative action is to bedoubted. After considering the meaning of theword 'may' in its ordinary sense, as well as inthe constitutional, statutory and factual con-

texts, the majority of the Constitutional Courtdisagreed with the majority decision in the SCAto the extent that it imposed an absolute dutyon the commissioner to appoint the incumbentwhen the conditions set out in paragraphs (a)and (b) are met. However, the majority in theConstitutional Court also disagreed with theminority of the SCA to the extent that its deci-sion created the risk of redundancy conse-quent upon the advertisement of the post.Sachs J, writing for the majority, held that thesubregualtion had to be interpreted so as toharmonise two competing considerations:

'The first is the need to give the commissioner thenecessary flexibility to strengthen the leadershipcapacity of the service in a transparent manner.The second is the requirement that incumbentswhose work is satisfactory should not be subject-ed to the anxiety of possibly losing their jobs sim-ply because their posts are being upgraded.

In my view, then, the regulations can and shouldbe read in a way that neither produces the rigidityof outcome that would flow from the view of themajority in the Supreme Court of Appeal, nor car-ries the risk of consequent redundancy, implicit inthe minority approach. It is indeed possible to har-monise flexibility of application with respect forappropriate job security. This can be achieved byacknowledging that the Commissioner does havea discretion whether to advertise or not, but thatthe discretion must in each case be exercised insuch a way as to not lead to the loss of employ-ment by a satisfactory incumbent as a conse-quence of the upgrading of his or her post. Norshould incumbents who are threatened withretrenchment because their posts have beenupgraded, be obliged on a case by case basis toinvoke administrative or labour law mechanisms tosecure their positions in the service. Sinceretrenchment utilising the provisions of regulation24(6) would be manifestly unfair, the regulationshould be interpreted as a matter of law as requir-ing the Commissioner to exercise his discretion ina manner which does not lead to job loss. Anincumbent whose work is satisfactory should notbe subjected to the anxiety of losing employmentsimply because the work he or she is doing is con-sidered to be worthy of an upgrade and better pay.'(paras 33-4, footnotes omitted)

Yacoob J, also writing for the majority,expressed the same point in slightly differentterms:

'The Minister could never have contemplated thatthis regulation aimed at dealing with the con-sequences of the upgrading of a post couldresult in the dismissal of the incumbent of that

41

post in circumstances where he had been per-forming satisfactorily in the upgraded post. Ifthis had been the intention, I would haveexpected this to have been said in so manywords. And even if this had been expresslysaid in the regulations, the constitutionality of aprovision of this kind would, in my view, beextremely doubtful. In the circumstances, Iconclude that the exercise of theCommissioner's discretion is limited. The dis-cretion cannot be exercised in such a way asto raise the possibility of the dismissal of thesatisfactorily performing incumbent. If it does,the exercise of that discretion will be invalid. Toput it positively, it is implied in the regulationthat the Commissioner may only exercise adiscretion not to appoint the incumbent if satis-fied that the incumbent would not find herselfout of a job merely by reason of the decision ofthe Commissioner to advertise the post andthe fact of the incumbent not being appointedto that post.'(para 81, footnote omitted)

O'Regan J dissented from the majority posi-tion. Although she agreed with the majority thatthe ordinary meaning of a word may be super-seded by an interpretation that takes other fac-tors into account, she pointed out that anyinterpretation that is applied to a statutory pro-vision must remain reasonably supported bythe plain text of the provision. She stated in thisregard:

'Although I agree that reg 24(6) should not beread to create the possibility of job losses, toensure that the interpretation afforded to theregulation is consonant with the spirit, purportand object of the Bill of Rights, I am not per-suaded that the approach to the regulationadopted by Sachs J and Yacoob J is correct.

In the first place, their interpretation maystretch the text of regulation 24(6) beyond itsreasonable bounds. If the text is read to permita choice as to whether to advertise or not, theinevitable consequence is that a person otherthan a satisfactorily performing incumbent maybe appointed to the newly re-graded post withthe effect that the incumbent no longer has apost. The requirement that the discretion mayonly be exercised if job losses will not result isnot explicitly mentioned in the regulation. Attimes, to comply with section 39(2) of theConstitution, a provision must be given ameaning which may not be the first meaningthat springs to mind. However, it may not begiven a meaning beyond that which it is rea-sonably capable of bearing. It seems to methat the interpretation suggested by Sachs Jand Yacoob J may well fall foul of this require-ment.

As importantly, however, it seems to me thatthe interpretation will, in effect, result in theCommissioner often not genuinely being ableto exercise a choice. Indeed, he will not beable to advertise the post unless there is a suit-able vacant position at an appropriate level towhich the incumbent can be moved. Bear inmind, that if after advertisement a candidateother than the incumbent is selected for theposition, the incumbent will have no postunless moved to another vacant post. She orhe will only be able to be moved into anothervacant post in accordance with regulation36(2)(e) if there is such a vacant post in exis-tence at a similar grading level. Moreover,given that job evaluation exercises the evalua-tion of large numbers of posts, it is clear whatwill happen should more incumbents be ren-dered supernumerary that the number of avail-able suitable vacant posts. In the circum-stances, unless there is a vacant post to whichthe incumbent can, without contest from othercandidates, be moved, the Commissioner can-not be sure that a job loss will not result, oncehe commences the process of advertisement.In the circumstances, it is not clear to me, howoften the Commissioner will really have achoice on the interpretation proposed bySachs J and Yacoob J'. (paras 93-5)

O'Regan J noted that it is well recognised thatthe word 'may' does not always confer achoice, and that this is one of those occasions(para 97). She endorsed the view of the major-ity in the SCA that where the conditions set outin paragraphs (a) and (b) of the subregulationare met, the commissioner has no choice but toappoint the incumbent to the newly gradedpost. This interpretation, she held, also avoidsthe risk that satisfactorily performing incum-bents will lose their jobs just because of theregarding of their posts.

The case of CDA Boerdery (Edms) Bpk andOthers v Nelson Mandela MetropolitanMunicipality ad Others 2007 (4) SA 276 (SCA)dealt with an objection to the power of the Respondent municipality to assess certainrates against the property of the appellants.The appellants' argument was essentially that,in terms of applicable legislative provisions themunicipality was required to obtain the consentof the Premier of the Eastern Province in orderto assess a rate of more than two cents in theRand on their respective properties. The appel-lant's argument was based on a reading of theLocal Government Transition Act 209 of 1993and the Municipal Ordinance 20 of 1974. While

42

the earlier ordinance required the provincialAdministrator (now the Premier) to approverates over two cents in the Rand for certaintypes of property, the later Act made no men-tion of such a requirement. It was the munici-pality's argument that the new legislative andconstitutional framework had impliedlyrepealed the requirement set out in theOrdinance, while the appellant landownersrelied on the fact that the relevant provisions ofthe Ordinance remained nominally in force.The SCA was divided in its judgment, theminority (Conradie JA) upholding the appel-lants' argument and the majority (per CameronJA) finding in favour of the municipality. Thetwo contrasting judgments illustrate an impor-tant characteristic of the powers of municipali-ties under the constitutional dispensation, andhighlight the difference in the nature of thepowers that municipalities enjoyed in the pre-constitutional and constitutional eras. The firstof the relevant legislative provisions, section10G(6) of the Transition Act, provides:

'A local council, metropolitan local council andrural council shall, subject to any other law, ensurethat-(a)properties within its area of jurisdiction are val-ued or measured at intervals prescribed by law;(b)a single valuation roll of all properties so valuedor measured is compiled and is open for publicinspection; and(c)all procedures prescribed by law regarding thevaluation or measurement of properties are com-plied with'.

Section 10G(7), the second of the relevant pro-visions, stipulates:

'A local council, metropolitan local council andrural council may by resolution, levy and recoverproperty rates in respect of immovable property inthe area of jurisdiction of the council concerned:Provided that a common rating system as deter-mined by the metropolitan council shall be appli-cable within the area of jurisdiction of that metro-politan council: Provided further that the councilconcerned shall in levying rates take into accountthe levy referred to in item 1(c) of Schedule 2:Provided further that this subparagraph shall applyto a district council in so far as such council isresponsible for the levying and recovery of prop-erty rates in respect of immovable property withina remaining area or in the area of jurisdiction of arepresentative council.'

The court was asked to determine the properrelationship between these two provisions andthe provision of the Ordinance providing that

certain rates assessed by the municipalityrequire approval by the Premier before theycan be said to be lawful. Conradie JA's minori-ty's view was the following:

'Section 10G(6) of the Transition Act which dealtwith valuations, acknowledged the MunicipalOrdinance by providing that a municipality should,subject to any other law, ensure that propertieswithin its area were valued or measured at inter-vals prescribed by law. Moreover, 'all proceduresprescribed by law regarding the valuation ormeasurement of properties' had to be compliedwith. In the case of the Eastern Cape this was theValuation Ordinance of 1993 or the ValuationOrdinance of 1944. There was a dispute betweenthe parties as to which of these laws applied butthat is unimportant. The point is that s 10G(6) inexpress terms envisaged the incorporation ofexisting provincial laws into the Transition Act inthe sense that they were to be taken into accountin the rating scheme. Section 10G(7) does nothave such an express incorporation provision. Itseems to me to have been a legislative oversightthat must be adjusted by interpretation. Valuationof immovable property is an integral part of ratingproperty: The imposition of a rate envisages a levyof so many cents in the Rand of the value of prop-erty. Rating without valuation is impossible.' (para14)

Conradie JA went on to note that an impliedrepeal of legislation is never lightly inferred(para 24), and that the greater power affordedthe Minister of Local Government over munici-pal rating powers in terms of the LocalGovernment: Municipal Property Rates Act 6 of2004 which replaced the Transition Act indicat-ed that municipalities were never intended tohave unrestricted rating powers (para 25). Theordinance and the Transition Act, he accord-ingly held, were complimentary and had to beread alongside each other. Their complimenta-ry effect was only repealed by the LocalGovernment: Municipal Property Rates Act in2004 (para 26). Cameron JA's disagreementwith Conradie JA's position rested largely onan assessment of the different positions occu-pied by municipalities under the distribution ofpower before and after the coming into effect ofthe Constitution. This difference of viewresolved itself into a difference in opinion as towhether the Ordinance governed the munici-pality's assessment of rates or not (para 32). Indrawing the distinction between the pre-consti-tutional and post-constitutional eras, CameronJA said:

'Under the pre-constitutional dispensation, munic-

43

ipalities owed their existence to and derived theirpowers from provincial ordinances. Those ordi-nances were passed by provincial legislatureswhich themselves had limited law-making authori-ty, conferred on them and circumscribed byParliamentary legislation. Parliament's law-makingpower was untrammelled, and it could determinehow much legislative power provinces exercised.The provinces in turn could largely determine thepowers and capacities of local authorities.Municipalities were therefore at the bottom of ahierarchy of law-making power: constitutionallyunrecognised and unprotected, they were by theirvery nature "subordinate members of the govern-ment vested with prescribed, controlled govern-mental powers".' (para 33, footnotes omitted)…'[T]he new constitutional order conferred a radical-ly enhanced status on municipalities. Under theinterim Constitution, each level of government(national, provincial and local) derived its powersdirectly from the Constitution (though local gov-ernment's powers were subject to definition andregulation by either the national or provincial gov-ernments). The constitutional status of local gov-ernment was therefore "materially different" fromthe pre-constitutional era.' (para 37)…'Can the Ordinance's requirement that theAdministrator (now the Premier) must approverates over 2 cents in the Rand survive this radical-ly different and enhanced realisation of local gov-ernment powers? In my view, the answer must beNo. Under the old dispensation, it was both natu-ral and appropriate that central government'ssuperior position over municipalities, and theprovince's role as the source of local government'spower, should find expression in the power of gov-ernment's chief provincial executive official, theAdministrator, to approve rates.

Under the Constitution both the province general-ly and the Premier specifically have an entirely dif-ferent role in relation to local authorities. Thoughprovincial government has important functions inrelation to municipalities, its role is constitutionallydescribed and circumscribed. Nothing in theConstitution suggests that the Premier of aprovince enjoys special supervisory powers overthe exercise of local government functions, or spe-cial duties in relation to the determination of rates.'(paras 39-40)

The majority of the SCA thus dismissed theappeal, concluding that there is 'a clear repug-nancy between the scheme of the preconstitu-tional distribution of power, which gave rise tothe requirement of the Administrator'sapproval, and the scheme under theConstitution' (para 44).

NOTE: It was not considered in this case, nor

indeed any of the cases that have dealt withthe rating power of municipalities (see HowickDistrict Landowners Association v uMngeniMunicipality and others 2007 (1) SA 206 (SCA)reported in the 8th Edition of the PAJANewsletter), whether the imposition of rates bymunicipalities amounts to an administrativeaction in terms of section 1 of PAJA. The defi-nition of administrative action in PAJA excludes'the executive powers or functions of a munici-pal council'. Whether the power of municipali-ties to impose rates is an administrative actionor not awaits judicial consideration.

In Sechaba v Kotze and others [2007] 4 All SA811 (NC) (see above under 'Section 7 -Procedure on review'), the first and secondrespondents sought by way of a counter-appli-cation the review of the third respondent's deci-sion granting the applicant a prospecting rightin terms of the Minerals and Petroleum RightsDevelopment Act 28 of 2002 (MPRDA). Themain application, while discussed briefly aboveunder 'Section 7 - Procedure on review', has nobearing on the contents of this Newsletter. Thefirst and second respondents' challengeagainst the third respondent's decision wasthat, in terms of the MPRDA, the third respon-dent, the Department of Minerals and EnergyRegional Manager for the Northern Cape, wasnot authorised to grant a prospecting right tothe applicant. In terms of section 17 of the Actthe Minister is empowered to grant prospectingrights, but in terms of section 103 the Ministermay delegate any power he or she has to anythe Director-General, the Regional Manager orany officer. It was common cause in the casethat the Minister had delegated the power togrant prospecting rights onto the DeputyDirector-General (the DDG) of the Departmentof Minerals and Energy, and that further dele-gation of the power had been expressly pro-hibited by the Minister (para 45.2). After review-ing the applicant's application for a prospectingright, the Regional Manager wrote a letter tothe DDG requesting that he grant the applicanta prospecting right and sign a power of attor-ney authorising the Regional Manager to 'signon [the DDG's] behalf the prospecting right tobe granted to' the applicant (para 45.2). TheDDG complied with both of these requests. Theapplicant relied on the DDG's actions as grant-ing the prospecting right it had sought, but thecourt (Lacock and Olivier JJ) disagreed, hold-ing that all the DDG had done was agree to the

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Regional Manager's request that a prospectingright be granted at some point in the future(para 46.2). The court reached this conclusionon the basis that section 17 of the MPRDArequires 'terms and conditions' of the prospect-ing right to be determined. On the facts, nosuch terms and conditions had been deter-mined, and in the absence of such terms andconditions it could not be said that that aprospecting right had been granted to theapplicant (para 46.3). The court went on to dealwith the lawfulness of the Regional Manager'saction even if it could be said that a prospect-ing right had been granted to the applicant:

'If the relevant prospecting right…was grant-ed to [the applicant]…that right was grantedby the Regional Manager, who was notauthorised to grant the right on behalf ofeither the Minister or the DDG. It was con-ceded by [counsel for the Regional Manager]that the aforementioned power of attorneywas not a valid delegation of power by theDDG to the Regional Manager, and it wasfurther conceded that, should we find thatthe…prospecting right was granted to [theapplicant] by the Regional Manager, thatconduct by the Regional Manager would beultra vires his authority, rendering the rightvoid.' (para 47)

Common-law review - Jurisdictional facts

When an empowering provision requires cer-tain conditions to be satisfied before a powercan be exercised, those conditions are referredto in South African common law as 'jurisdic-tional facts'. They are facts which in effectestablish the jurisdiction of the official to act. Inthe absence of these facts, the official's actionsare unlawful. PAJA codifies this common-lawprinciple in section 6(2)(b), but several casescovered on this edition of the Newsletter dealwith jurisdictional facts without reference toPAJA. Rudolph and others v Minister of Safetyand Security and Another [2007] 3 All SA 271(T) involved a claim of wrongful arrest. Theplaintiffs had gathered along with others to takepart in a demonstration, during which certainbanners and information critical of the SouthAfrican government were displayed and dis-seminated. The Regulation of Gatherings Act205 of 1993 requires in section 3 that adequatenotice of an intended gathering be given, andprovides in section 12(1)(a) that 'any personwho convenes a gathering in respect of whichno notice or adequate notice was given in

accordance with the provisions of section3…shall be guilty of an offence'. It was com-mon cause in the case that no notice had givenfor the gathering in which the plaintiffs hadtaken part (para 143). When members of theSouth African Police Services (SAPS) instruct-ed the plaintiffs to disperse as the gatheringwas unlawful, they refused to do so (para 145-6). The plaintiffs were subsequently arrestedon suspicion of committing the crime of sedi-tion. The source of the police officers' legalpower to arrest the plaintiffs in the absence ofa warrant of arrest in this case is provided bysection 40(1)(b) of the Criminal Procedure Act51 of 1977. A peace officer, including a mem-ber of the SAPS, may arrest any person whomhe or she 'reasonably suspects' of having com-mitted an offence. The existence of a reason-able suspicion that an offence has been com-mitted is thus a jurisdictional fact on which thepower to arrest a person without a warrantrests (para 129). Although PAJA was notreferred to in the judgment, in the language ofsection 6(2)(b) of PAJA the existence of a rea-sonable suspicion is a 'mandatory and materi-al…condition' that must exist before the powerconferred by section 40(1) of the CriminalProcedure Act can lawfully be exercised.Relying on Duncan v Minister of Law and Order1986 (2) SA 805 (A) at 818G-819B, the judgeheld that where the jurisdictional requirementsare satisfied, the peace officer has a discretionwhether to exercise the power or not. The exer-cise of that discretion will clearly be unlawful,however, if the arrestor knowingly invokes thepower to arrest for a purpose not contemplatedby the legislator (para 130). The judge couldnot, on the evidence before him, find any indi-cation of mala fides or ulterior motive on thepart of the arresting officers (para 172). Thejudge therefore concluded that on the facts,there requirement that a reasonable suspicionthat a crime had been committed had been sat-isfied, and the arrest was made lawfully.

See also Cele v Minister of Safety and Security[2007] 3 All SA 365 (D) for a similar discussionof jurisdictional facts necessary for the exerciseof police powers of arrest.

The failure to comply with a statutory jurisdic-tional condition was again argued in the caseof Jeebhai v Minister of Home Affairs andanother [2007] 4 All SA 773 (T), again withoutreference to PAJA. The case concerned the

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highly publicised deportation of one KhalidRashid to Pakistan by the respondents, theSouth African authorities responsible for immi-gration control. The applicant sought a numberof declaratory orders relating to the lawfulnessof the arrest, detention and subsequentremoval of Rashid from the country (para 4).The applicant was a businessman acting onbehalf of Rashid (para 1). It was commoncause that at all times the respondents pur-ported to act in terms of the Immigration Act 13of 2002. The applicant's main argument thatthe decision to deport Rashid in terms of sec-tion 34 of the Act was unlawful because thejurisdictional conditions for invoking the powersconferred by section 34, set out in section 8,had not been complied with. It was commoncause that the requirements set out in section8 of the Act had at no time been followed orcomplied with by the respondents.

Section 34 deals with actions taken by theauthorities once a person has already beenidentified as, and is known to be an 'illegal for-eigner' for the purposes of the Act. Section 8,on the other hand, prescribes conduct to betaken if an immigration official determines thata person is an illegal foreigner. The applicantrelied on the judgment in Muhammed vMinister of Home Affairs and others [2007] JOL18935 (T), where Southwood J found that theprocedure in section 8(1) and (2) had to be fol-lowed before arrest and detention in terms ofsection 34 (para 19). On Southwood J's read-ing and on the facts of that case, compliancewith section 8 was held to be a jurisdictionalcondition for the exercise of the powers con-ferred by section 34. In the absence of compli-ance with the provisions of section 8, actiontaken purportedly in terms of section 34 wouldbe unlawful. The court distinguished the pres-ent matter from that case, however, by pointingout that a person may come to be identified asan illegal foreigner through means other thansection 8. Section 8 does not always apply, andis therefore not a jurisdictional prerequisite foraction empowered by section 34:

'Section 34 can be invoked under three dif-ferent circumstances. Firstly, after the proce-dure in section 8 has been followed andexhausted; that is, once a person has, interms of that section, been declared an ille-gal foreigner and his rights of review orappeal have been exhausted. A decision interms of section 34(1) to deport the person is

then taken. Secondly, once a person hasbeen found to be an illegal foreigner in termsof the procedure set out in section 41(1); thatis, after that person, following a reasonablesuspicion, fails to prove that he/she is in thecountry lawfully after an inquiry into his/heridentification. Thirdly, where the person con-cerned agrees, and it becomes commoncause, that he/she is an illegal foreigner; sec-tion 34(1) can be invoked to deport that per-son. This may happen even where there wasno prior inquiry based on reasonablegrounds which had prompted a suspicionthat the person was illegally in the coun-try…The jurisdictional condition for invokingsection 34 is that the person is an illegal for-eigner. Rashid falls into the third and indeedalso the second scenario. Section 8 there-fore has no application in his case. Theargument based on non-compliance cantherefore not stand.' (para 26)

In the language of section 6(2)(b) of PAJA,compliance with section 8 was not a 'mandato-ry and material…condition' for the exercise ofthe powers conferred by section 34.

In Saleem v Minister of Finance and another[2007] All SA 1040 (T) Van Rooyen AJ held thatthe failure of an officer acting in terms of theCustoms and Excise Act 91 of 1964 to 'applyhis mind' to the jurisdictional requirementsestablishing his power to seize goods suspect-ed of being imported illegally justified the set-ting aside of the seizure. A senior anti-smug-gling officer in the employ of the secondrespondent, the South African RevenueService, detained goods in a certain shop interms of section 88(1)(a) of the Act. That sec-tion entitles an officer to detain goods at anyplace for the purpose of establishing whetherthey are liable to seizure by the second respon-dent in terms of section 88(1)(c) the Act. Indealing with this initial detention of goods, VanRooyen AJ held:

'[S]ection 88(1)(a) must, in terms of section39(2) of the Constitution of the Republic ofSouth Africa, be interpreted on accordancewith the spirit, purport, and objects of the Billof Rights. Section 14 of that Bill protects pri-vacy as a fundamental right. Privacy includesthe right of everyone not to have their pos-sessions seized. Section 36 sets out the jus-tifiable limitations. The limits of protection willvary according to the circumstances. Whatwill be unreasonable in regard to a privatehome could very well be reasonable in con-nection with a business. Section 88(1)(a)should, accordingly, be interpreted as requir-

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ing that the officer, before he detains, musthave reasonable grounds to suspect that thegoods are goods which, after further exami-nation, might be (imported) goods liable toforfeiture.' (para 12)

Van Rooyen AJ concluded that the officer was,on the facts, entitled to detain the goods for thepurpose of determining whether the goodswere subject to seizure (para 15). The jurisdic-tional requirement for detention, reasonablegrounds to believe that the goods had beenimported and were liable to seizure, had beensatisfied. The goods were later seized in termsof section 88(1)(c) of the Act because the appli-cant failed to produce evidence in the forms ofinvoices or documentation proving the goodshad been lawfully imported. In respect of thelawfulness of the seizure, Van Rooyen AJ saidthe following:

'I believe that it was not enough for [the secondrespondent's officer] - judged on the papers -to have done nothing more than wait uponthe applicant to provide proof. The term"establish" must surely mean much morethan waiting upon the applicant. It impliesinvestigation. The inactivity after detention ofthe officer involved justifies the reasonableinference that he never intended to investi-gate further. …In the present matter therecould not, reasonably, have been more thana suspicion that the goods were importedgoods in terms of section 88(1). [The officer]states that he was prima facie of the viewthat the goods were subject to forfeiture as aresult of the "Made in China" tags and theabsence of importation documentation orproof from whom the goods were pur-chased…I am of the view that the mere factthat the goods bear tags that they are "Madein China" is not sufficient in itself to justify aninference that the goods were imported.'(para 15)

…'[T]he officer should have investigated further

whether the goods were indeed importedgoods. For all he knew the goods were man-ufactured in South Africa, in spite of the"Made in China" tags and the Chineseinscriptions on the goods. My impression isthat the officer focused only on one aspect:the insufficiency of invoices. The officer has,with respect, misunderstood the jurisdiction-al facts of which he should have been con-vinced in terms of section 102 when hedecided to seize…The officer had seriouslyto apply his mind to the existence of the juris-dictional facts and it was not for the applicantto convince him in the sense of an onus.(paras 20-21)

The judge concluded that the officer 'did notapply his mind rationally to the relevant issues'and that the seizure of goods was accordinglyinvalid (para 22).

NOTE: No reference was made to PAJA in thejudgment, despite the fact that the matter couldhave been resolved with regard to section6(2)(b) of PAJA ('mandatory and material pro-cedure or condition prescribed by an empow-ering provision was not complied with'), section6(2)(e)(iii) ('relevant considerations were notconsidered'), or section 6(2)(f)(ii)(cc) (the deci-sion was not rationally connected to the infor-mation before the administrator).

Common-law review - Unreasonableness

Radio Pretoria v Chairperson of theIndependent Communications Authority ofSouth Africa [2007] 3 All SA 484 (SCA) is thelatest judgment in a matter that has had a longhistory before our courts. In 1995 theIndependent Broadcasting Authority (the pred-ecessor to the second respondent, theIndependent Communications Authority ofSouth Africa (ICASA)), granted Radio Pretoriaa temporary one-year license to operate as acommunity radio station. Further one-yearlicenses were granted in 1996, 1997 and 1998.After a dispute that has no bearing on subse-quent events, a fifth temporary license wasissued for 1999. In 2000 ICASA took over therole of the IBA in terms of the IndependentCommunications Act 13 of 2000. The sixthtemporary broadcasting license for whichRadio Pretoria applied was refused by ICASAin terms of the Independent CommunicationsAct and the Broadcasting Act 4 of 1999,because its employment practices discriminat-ed against people who were not 'Boere-Afrikaners', and was not representative of thebroader community to which it broadcast.ICASA had asked Radio Pretoria to supply awritten explanation of its employment practicesprior to making its decision. Radio Pretoriachallenged this decision before the PretoriaHigh Court, arguing that in affording RadioPretoria the opportunity to make written repre-sentations alone, ICASA had acted in violationof the principles of audi alteram partem.Bosielo J found, however, that the actions ofICASA had been administratively fair. Thisdecision is reported as Radio Pretoria vChairman, Independent Communications

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Authority of South Africa, and Another 2003 (5)SA 451 (T). Radio Pretoria appealed BosieloJ's decision to the SCA. Sometime previously,however, Radio Pretoria had applied to ICASAfor a four-year broadcasting license. That appli-cation was refused after Bosielo J deliveredjudgment in regard to the sixth temporary one-year license, but before the appeal was heardin the SCA. Radio Pretoria then approachedthe Pretoria High Court on an urgent basisseeking an interim order allowing it to continueto broadcast pending the outcome of a reviewof ICASA's decision to refuse a four-yearlicense. An order to this effect was granted byPreller J on 30 June 2004 (unreported). By thetime the appeal regarding ICASA's refusal ofthe sixth one-year license was heard by theSCA, events had overtaken the issues suchthat no live dispute existed between the par-ties. The SCA therefore dismissed the applica-tion on the basis of mootness. This decision isreported as Radio Pretoria v Chairman,Independent Communications Authority ofSouth Africa, and Another 2005 (1) SA 47(SCA) and is noted in the 4th Edition of thePAJA Newsletter. An application for leave toappeal to the Constitutional Court was refused.This judgment is reported as 2005 (3) BCLR231 (CC). The review application in respect ofICASA'a decision to refuse a four-year broad-casting license was eventually dismissed bythe Pretoria High Court. This decision is report-ed as Radio Pretoria (geregistreer ooreenkom-stig artikel 21 van die Maatskappywet van SAvan 1973 soos gewysig) v Voorsitter van dieOnafhanklike Kmmunikasie-owerheid van SAen 'n ander [2006] 1 All SA 143 (T) and is dis-cussed in the 6th Edition of the PAJANewsletter. ICASA had given four reasons forthe refusal of the license, and although Smit Jfound in the High Court that the one of thesereasons was not rationally supported by thefacts, the other three reasons given by ICASAwere well-founded and dismissed the applica-tion. The present case is an appeal against thisjudgment of Smit J.

Radio Pretoria's main contention on appealbefore the SCA is, however, quite unrelated tothe grounds on which it challenged the deci-sion before the High Court:

'The main contention of the appellant on appeal isthat the second respondent [ICASA] treated theappellant's application as an application for a

licence to broadcast to a certain area whereas theappellant's application was for a licence in respectof a different area.' (para 1)

In terms of ICASA's 'radio frequency plan' orRFP, each province was divided up into num-bered radio coverage areas. Each communityradio station's radio coverage was determinedaccording to which area it could broadcast to,and limited by the allowed strength of its trans-mitters and the height of its transmitting radioantennae. It was common cause that whileRadio Pretoria had applied for a licence inrespect of RFP 17-23, ICASA treated the appli-cation as one for a licence in respect of RFPlicence area 18 alone (para 14). The court, perStreicher JA, responded as follows:

'Although the appellant did not specifi-cally say that Icasa's decision shouldbe reviewed because it never consid-ered its application for a licence inrespect of a target area comprisingRFP licence areas17-23 it did say thatIcasa erred in confining its applicationto RFP licence area 18 in that its targetarea is much wider. The allegation pro-vided a sufficient basis for the submis-sion now advanced namely that Icasatreated the application as being anapplication in respect of RFP licencearea 18 and failed to consider the realapplication being an application for alicence in respect of a much wider areanamely a target area comprising RFPlicence areas 17-23.' (para 17)

Radio Pretoria had applied for a licence inrespect of RFP 17-23, ICASA treated the appli-cation as one for a licence in respect of RFPlicence area 18 alone (para 14). The court, perStreicher JA, responded as follows:

'The respondents [ICASA and its chairper-son] also submit that Icasa's reasonsfor refusing the appellant's applicationfor a licence applied with equal force toan application by the appellant for alicence in respect of the target areaidentified in its application and that theapplication for the review of Icasa'sdecision should, in any event, for thisnot have succeeded. The submissionis wrong in that some of the reasonsdo not apply with equal force to anapplication for a licence in respect ofthe target area. It is, in any event, noanswer to the appellant's complaint tosay that the reasons for the dismissalapply with equal force to an application

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for a licence in respect of the appel-lant's target area. The appellant is enti-tled to have its application consideredby Icasa. Icasa failed to consider theappellant's application for a communitybroadcasting licence in respect of thetarget area identified by it and by treat-ing it as an application for a licence inrespect of RFP licence area 18 it actedso unreasonably and irrationally thatits decision should be set aside.' (para20)

The court remitted the decision back to ICASAfor reconsideration. It is worth mentioning inthis respect that while the court a quo decidedthe matter on the basis of section 6(2)(f)(ii) ofPAJA, which allows courts to review adminis-trative actions on the basis of rationality, theSCA made no mention of PAJA and decidedthe case apparently on the basis of common-law grounds review for rationality and reason-ableness.

Common-law review - Estoppel

The plaintiff in RPM Bricks (Pty) Ltd v City ofTshwane Metropolitan Municipality [2007] 3 AllSA 423 (T) raised estoppel in response to thedefence raised by defendant. The defendantawarded a tender contract to the plaintiff for thedelivery of coal, for a period of three years, totwo power stations operated by the defendant(para 3). At some point during the course of thecontract, the plaintiff requested an increase inthe unit price of coal, assessed on the basis ofthe quality of the coal measured in megajoulesper kilogram. The defendant claimed that theprice increase was not validly authorised, andrefused to pay the plaintiff at a rate higher thanthe original contract price. The plaintiff's claimamounts to the difference between the originalcontract price and the requested increase.Patel J summarised the questions before thecourt thus:

'[T]he nub of the dispute is whether the priceincrease requested by the plaintiff was validlygranted by the defendant. If it was then the defen-dant is indebted to the plaintiff in the sum of R2646 134, 40… On the other hand, if the priceincrease was not validly granted then what needsto be determined is, whether the defendant isestopped from denying that the price increase wasin fact granted or whether the defendant has beenenriched at the expense of the plaintiff in respectof the coal delivered during December 2002 and

January 2003, and if so, to what extent the defen-dant has been enriched.' (para 7)

The defendant raised two broad arguments indefence. First, it argued that its employees whohad signed the letter purportedly authorisingthe requested price increase had no authorityto do so, and second, it argued that theincrease of the contract price violated severalnational and regional statutory rules. Thesedefences are summarised by Patel J:

'The defendant, however, endeavoured to avoidpayment by raising several defences. These arefirst, although the defendant admits that the letterconfirming the price increase requested by theplaintiff was addressed to the plaintiff but allegesthat it was drafted by CH Arlow and signed by DStrydom. Both of them were defendant's employ-ees, but neither of whom were authorised to draftor to agree to the contents of the letter, or to con-firm the contents of such letter to the plaintiff, or toaddress such a letter to the plaintiff. It was allegedthat when Strydom signed the letter confirming theprice increase, he bona fide and reasonablybelieved that the price increase as set out in theannexure to the letter was that provided for inparagraph 3 of the tender award, that is the annu-al PPI increases. It was also alleged that he neverintended to sign the letter to which the annexureswere attached containing the price increase inexcess of the price increase provided for in thetender award, or price increase calculated on a dif-ferent basis than provided for in the tender award.Secondly, that at no stage did the defendantresolve to vary the supply contract or the termsand conditions set out in annexure "POC4" asrequired by section 38(1) of the Rationalisation ofLocal Government Affairs Act 10 of 1998[Gauteng] ("the Rationalisation Act"). Nor did itcomply with the formalities prescribed in section38(3) of the Rationalisation Act. Thirdly, that thepurported variation of the supply contract in termsof annexure "POC4" would have increased thetender value of the supply contract by more than20% and consequently would in terms of section38(2)(c) of the Rationalisation Act have been void.Fourthly, that in terms of section 10G(5)(a) of theLocal Government Transition Act, Act 209 of 1993("the Transition Act") and the regulations theretothe defendant was not empowered to vary thesupply contract on the terms and conditions setout in annexure "POC4", but had to call for tenderswith a view to entering into a new supply contract,which it failed to do.' (para 13)

The plaintiff's response, however, was that thedefendant could not rely on its own error inorder to escape liability for the increased con-tract price. The defendant, the plaintiff argued,

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is estopped from denying the validity of its ownactions:

'[T]he plaintiff avers that the defendant is estoppedfrom denying the authority of its officials. Theplaintiff also avers that the defendant is estoppedfrom denying that it resolved, as required by sec-tion 38(2) of the Rationalisation Act, to vary thesupply contract by increasing the contract price.'(para 14)

In dealing with the plaintiff's claim of estoppel,the judge had to consider the principle of ouradministrative law that estoppel will not beallowed to validate action that is otherwise notauthorised in law. After restating this principleand citing the relevant authority, Patel J wenton to draw an important distinction in applica-tion of the principle:

'The application of this principle has the effect,inter alia, that a statutory body has such powersand duties that are entrusted to or imposed uponit by statute, and it cannot be bound by estoppel todo something beyond its powers, or to refrain fromdoing something which it is its duty to do. (LAWSA[vol 9] paragraph 472; Trust Bank van Afrika Bpk vEksteen 1964 (3) SA 402 (A) at 411H-412B; (at32); Eastern Cape Provincial Government vContractprops 25 (Pty) Ltd 2001 (4) SA 142 (SCA)148E-G.) What is important in the present actionregarding the application of the doctrine of estop-pel is that a distinction must be drawn betweenacts which are ultra vires of a statutory body asopposed to those acts which are within the statu-tory body's powers if done after certain internalformalities have been complied with. In the lattertype of case persons dealing with the statutorybody may, in the absence of knowledge to the con-trary, assume that all the necessary formalitieshave been complied with, and may plead anestoppel if the defence is raised by the statutorybody, (as the defendant has done so in the instantmatter) that the necessary formalities were notcomplied with.' (para 27, footnote omitted)

Patel J then proceeded to consider the statuto-ry provisions on which the defendant relied toargue that the price increase was bad in law.Section 38 of the Rationalisation Act set out thecircumstances under which a municipal councilmay on its own initiative 'extend or vary a ten-der agreement'. Applying the provision to thefacts, Patel J found that the defendant's actionhad not been unlawful - that is, he found thatthe authorisation of the price increase had notbeen ultra vires the statutory powers of thedefendant. He concluded that the defendantcould therefore be estopped from relying on

the alleged non-compliance with the formalitieson which it seeks to avoid liability (para 29). Itmust be pointed out here that, given Patel J'sfinding that the defendant's actions had notbeen ultra vires, the issue of estoppel shouldnever has arisen. A claim of estoppel, if upheld,prevents a public authority from relying on theunlawfulness of its actions to escape the con-sequences of those actions. Necessary for asuccessful estoppel, then, is a finding that thepublic authority's conduct was unlawful in thefirst place. Here, however, Patel J found thatthe defendant's actions were not unlawful.There is no need to estop the defendant fromrelying on the unlawfulness of its actions inapproving the price increase, since its actionsin doing so were lawful to begin with. Whereestoppel is correctly considered is in relation tothe defendant's claim that its employees whohad purportedly authorised the price increasewere not empowered to do so. The defendant'sargument in this respect was that certain inter-nal formalities relating to the variation of thecontract, set out in section 38(3) and (4) of theRationalisation Act, had not been met. Thedefendant's employees' representation that theprice increase had been approved and wouldtake effect was thus, in the absence of compli-ance with these formalities, of no legal force oreffect. Patel J rejected this argument, correctlyupholding the plaintiff's claim that the defen-dant was estopped from relying on its own uni-lateral error in not meeting statutory formalities:

'Under the circumstances, it is clear that therequirements of estoppel are satisfied becausefirst, a representation was made by the defendantthat the price increase had beenapproved.…Secondly, the representations weremade by various officials of the defendant and notmerely by the officials who addressed the letter tothe plaintiff confirming that the price increaserequested by the plaintiff had been approved.Thirdly, the representations were in a form that thedefendant should reasonably have expected thatoutsiders, like the plaintiff would act on thestrength of such representation. This is evidentfrom the fact that the plaintiff undertook delivery byroad which it would not have done in the absenceof the price increase because to have done sowould have resulted in the plaintiff incurring loss-es. Fourthly, the plaintiff relied on the representa-tions to it that the price increase requested wasgranted. This is evident from the deliveries of coalto Rooiwal until February 2003, when deliverieswere stopped pursuant to the defendant's failureto effect payment at the end of December 2002and January 2003. Fifthly, the plaintiff's reliance on

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the defendant's approval was indeed reasonablegiven that notice of the price increase was issuedby the defendant's officials, who had ostensibleauthority to approve such increase…. Last, theprejudice to the plaintiff is self-evident.' (para 35)

The case of Margate Clinic (Pty) Ltd v genesisMedical Scheme 2007 (4) SA 639 (D) similarlyconsiders the circumstances under whichestoppal will be allowed to operate in anadministrative law setting.

In Van Wyk v Unitas Hospital and ANither(Open Democratic Advice Centre as AmicusCuriae) [2007] ZACC 24 (unreported, 6December 2007), the Constitutional Court con-sidered an application for leave to appealagainst a judgment of the SCA (reported asUnitas Hospital v Van Wyk and Another 2006(4) SA436 (SCA), discussed in the 7th Editionof the PAJA Newsletter). The case concernedan attempt by the applicant to obtain an inter-nal report commissioned by the respondenthospital pertaining to the quality of nursing inthe hospital's intensive care unit. The appli-cant's husband had died while receiving treat-ment in the hospital's intensive care unit. Shehad initially sought the report in order to aid indetermining the prospects of success in adelictual claim against the hospital for thedeath of her husband. Although she wouldhave access to the report under the rules ofpre-trial discovery set out in the Uniform Rulesof Court, this would only assist her once shehad already issued summons. The applicant'sargument in both the court of first instance andthe SCA was that she 'required' access to theinformation contained in the report 'for theexercise or protection of…rights' to claim dam-ages from the hospital (see section 50(1)(a) ofPAIA). A majority of the SCA (Brand, Cloete,Conradie and Harms JJA) upheld the hospital'sappeal and overturned the High Court's order,finding that the applicant had not shown thatthe report was 'required for the exercise or pro-tection of any rights', especially in circum-stances where the applicant could gain accessto the report through rules of discovery. Aminority of the SCA (Cameron JA) reached the

opposite conclusion, finding that pre-discoveryaccess to the report would have afforded theapplicant a 'substantial advantage' in formulat-ing her claim, and that this satisfied the require-ments of section 50(1)(a) of PAIA.

The applicant sought leave to appeal theSCA's decision to the Constitutional Court. It isclear from the disagreement in the SCA andthe persuasively argued judgments of both themajority and the minority that the case raisesimportant and contentious issues.Unfortunately, the Constitutional Court did notaddress the merits of the matter, and dis-missed the application for leave to appeal onprocedural grounds. The circumstances lead-ing to this result are easily summarised: first,the applicant had waited 11 months before fil-ing her application for leave to appeal to theConstitutional Court, and had failed, in theCourt's view, to offer a reasonable explanationfor her delay (para 22). In addition, the Courtnoted that since the applicant had alreadyobtained the report she sought by way of dis-covery proceedings in the delictual claimagainst the hospital, the issue between the par-ties had become moot. The Court did recog-nise that mootness is not an absolute bar to thejusticiability of an issue (para 29). In addition,the Court had regard to the point made by theamicus curiae, that the issue of mootness islikely always to arise in case such as this:

'The amicus curiae submitted that it is neverthe-less in the public interest that the main issue beresolved. It submitted that issues relating to theright of access to information are, as a generalmatter, a moving target. This is so because thetime taken for the court process to take its courseis so long that people who seek information will nolonger be in a position to use the information totheir advantage by the time the proceedings(including any appeal) are finalised. Or by the timethe matter comes on appeal, the informationwould have been obtained through the rules relat-ing to discovery and therefore arguably render thematter moot. Therefore, the argument goes,issues relating to the right of access to informationwill invariably be moot by the time they reach thisCourt. These submissions are not without force.'(para 28)

The Court however concluded that in circum-stances where there had been an inordinatedelay, the applicant had failed to provide a rea-sonable explanation for the delay, and theissue between the parties was moot, it was not

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in the interests of justice to consider the meritsof the matter (para 34). The disagreementbetween the majority and the minority in theSCA thus remains unresolved.

David Dyzenhaus 'The Pasts and Future of theRule of Law in South Africa" (2007) 124(4)South African Law Journal pp 734-61. This arti-cle is an investigation of the role that the doc-trine of legality has come to play in judicialchecks on the power of government.Dyzenhaus argues that the doctrine of legalityinstalls courts as the ultimate arbiter of ques-tions even of central governance. TheConstitutional Court has nevertheless exer-cised this power judiciously, showing openrespect and deference to the authority of thegovernment. It is by no means clear,Dyzenhaus continues, that the government willcontinue to pay reciprocal respect to the judici-ary. The article examines the contested terrainbetween the judiciary and the government thatthe concept of the rule of law occupies.

Kerry Williams 'Pharmaceutical PriceRegulation' (2007) 23(1) South African Journalon Human Rights pp 1-12: Pharmaceuticalprice regulation is highly politicised, both glob-ally and in South Africa. As a result misinfor-mation and rhetoric is common. Regulators(whose duty it is to represent the public inter-est) face difficult policy decisions and are sub-ject to pressure from all stakeholders. Despitethese challenges, complex economic and legalsolutions may be employed to ensure theaccessibility of affordable medicines in thedeveloping world. The nature of the pharma-ceutical industry gives rise to unique economicproblems which may be resolved throughRamsey optimal pricing (also referred to as dif-ferential pricing) which allows pharmaceuticalmanufacturers to price according to the pricesensitivity of consumers, thereby ensuring thatpoorer consumers can afford essential medi-cines. This must be done within the legal flexi-bilities of the TRIPS Agreement. This articleexamines the theory of differential pricing, howit is constrained by TRIPS and how it is begin-ning to be implemented by way of internationalagreements and through specific policy choic-es made by national regulators. Examples from

Europe and South Africa are considered andcriticised. The European tiered pricing regula-tion offers the possibility of accessible andaffordable medicines in the developing worldbut is vastly underutilised. South African lawand policy makers ought to consider the princi-ples of differential pricing in greater detail sothat it may be worked into the current regulato-ry framework. In the interim, there is somepotential in the possibility of granting compul-sory licences.

Phoebe Bolton 'Incorporating environmentalconsiderations into government procurement inSouth Africa' (2008) 1 Tydskrif vir die Suid-Afrikaanse Reg pp 31-51: This article beginswith the premise that government procurementis not 'just business', as the public procurementof goods and services has wider social, eco-nomic and political implications. Procurementis often used to pursue 'secondary' goals suchas the pursuit of national social, industrial andenvironmental policies. This article illustratesthat ideals of sustainable development requirethe South African government to pursue envi-ronmental goals in its procurement policy, andargues that doing so would not fall outside thecurrent legislative framework.

ARTICLES ANDREVIEWS