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[2018] ZAGPJHC 511
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Mostert and Others v Nash and Others (34664/2017) [2018] ZAGPJHC 511; [2018] 4 All SA 267 (GJ) (14 August 2018)
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
CASE:
NO: 34664/2017
In
the matter between:
ANTONY
LOUIS
MOSTERT
First
Applicant
ANTONY
LOUIS MOSTERT N.O.
(in
his capacity as curator of the Third Applicant:
In
his capacity as liquidator of the Fourth
Applicant)
Second
Applicant
SABLE
INDUSTRIES PENSION FUND
(UNDER
CURATORSHIP)
Third
Applicant
POWER
PACK PENSION FUND
(IN
LIQUIDATION)
Fourth
Applicant
and
SIMON
JOHN
NASH
First
Respondent
ELENA
FORNO-NASH
Second
Respondent
ANCE
ROTHSCHILD
Third
Respondent
MIDMACOR
INDUSTRIES
LIMITED
Fourth
Respondent
CADAC
PENSION FUND
(UNDER
CURATORSHIP)
Fifth
Respondent
JOHAN
ESTERHUIZEN NO
(in
his capacity as joint curator of the Fifth
Respondent)
Sixth
Respondent
ANTONY
LOUIS MOSTERT NO
(in
his capacity as joint curator of the Fifth
Respondent)
Seventh
Respondent
FINANCIAL
SERVICES
BOARD
Eighth
Respondent
JUDGMENT
Matojane
J
Introduction
[1]
The dispute between the parties in this matter opposes fundamental
rights, freedom of expression and the right to be protected
against
defamatory remarks. Courts are guardians of the constitutional values
which include not only the freedom of expression
but also the respect
for the inherent dignity owed to 'all human beings. Based on the
facts of this case, I find that the latter
right should prevail.
[2]
The applicants (collectively referred to as "Mostert") seek
an order against the first to fourth respondents prohibiting
them
from disseminating, directly or indirectly, false and defamatory
allegations about Mostert. They also seek an additional relief
directing the respondents to close down certain websites and ordering
that the respondents may not institute proceedings against
Mostert
without first having obtained leave of the court.
[3]
The second, third and fourth respondents did not depose to
confirmatory affidavits and the allegations by Mostert is accordingly
not disputed by them.
[4]
The first respondent ("Nash") dispute the nature of the
defamatory claims alleged. He asserts that the order sought
would
constitute a severe violation of his fight to freedom of expression,
in that, firstly it seeks to limit his right t·o
impart
information and ideas unjustifiably; and secondly, it unjustifiably
limits the public's right to receive the information
about Mostert's
unlawful conduct.
[5]
Nash asserts that Mostert is trying to "gag" the
respondents in order to prevent his corrupt activities from being
exposed. He states further that the information which Mostert seeks
to withhold from the public is true, and its dissemination
is in the
public interest, in that the public has right to know the extent of
the misconduct of Mostert and the Financial Services
Board ("FSB"),
as public officials, and to make an informed judgement.
Overview
[6]
The third applicant and fourth applicants are both pension funds of
which first applicant ("Mostert") is the appointed
curator
and liquidator respectively. Mostert is cited in his personal
capacity and as a curator and as a liquidator of the pension
funds
respectively.
[7]
Mostert alleges that the first
respondent ("Nash''), utilising the
Ghavalas
Scheme
[1]
unlawfully removed and transferred the surplus of the Sable Pension
Fund in an amount of R36 million to Midmacor Industries Limited
("Midmacor").
Nash
was at the time a trustee of the Sable Pension Fund and was in
control of the principal employer of the Sable Pension Fund.
He avers
that as part of the unlawful removal of the surplus from the Sable
Fund, fraudulent applications in terms of section 14
of the Pension
fund Act were made
[2]
and the Registrar of Pension Funds issued section 14 certificates,
under it, transferring the business of the Sable Fund to the
Lifecare
Fund.
[8]
Mostert further alleges that Nash was a party to the fraud, t eft and
simulated transactions which were concluded with the object
of
unlawfully removing an amount of R42 million from the Power Pack
Fund. A substantial portion of these funds remains to be recovered
from Nash and Midmacor.
[9]
Nash and the other trustees of the Cadac Pension Fund, have according
to Mostert, misappropriated the amount of some R11 million
from the
Cadac Fund in order to finance Nash's defence in respect of
anticipated criminal charges of fraud and theft perpetrated
by him in
these funds.
[10]
Nash
and his company, Midmacor currently faces charges in the
Specialist Commercial Crimes Court for fraud, theft and money
laundering
relating to the removal of pension fund monies from the
Sable Pension Fund and the Power Pack Pension Fund. Nash's trial is
currently
underway, and Ghavalas is a state witness.
[11]
The second respondent is Elena Forno-Nash. She is married to Nash and
has served as the trustee of Cadac Pension Fund. Together
with Nash,
she is also a director and shareholder of the principal employer of
Cadac Pension Fund, Cadac (Pty) Ltd.
[12]
The third respondent is Lance Rothschild, a part-time journalist.
Mostert alleges that Nash and Forno-Nash engaged him in order
to
facilitate and advance an orchestrated smear campaign against him.
[13]
Ms June Marks, an erstwhile attorney of the Sable Fund, Power Pack
Fund and the Cadac Pension Fund is a witness in Nash's criminal
trial
and has deposed to some affidavits as to the manner in which Nash has
deceived her. She confessed that she had conspired
with Nash in an
orchestrated smear campaign, and during 2012, and at the instigation
of Nash, proffered criminal charges against
Nash, which she
subsequently withdrew. Marks explains that Nash influenced her into
believing that Mostert was guilty of wrongdoing
which she
subsequently established to be false.
Urgency
[14]
The Nash dispute the urgency of the application. He contends that
Mostert establishes no basis for the belief that any further
publication of defamatory material anticipated such that the
application must be determined urgently. Nash asserts that the
publication
in question has been in the public domain for many years
and Mostert has taken no steps to enforce his rights against the
respondents
in respect thereof.
[15]
It is trite that when courts are enjoined by rule 6(12) to deal with
urgent applications in accordance with procedures that
follow the
rules as far as possible, this involves the exercise of judicial
discretion by a court
'concerning which deviations it will
tolerate in a specific case'.
In
Safcor Forwarding
(Johannesburg) (Pty) Ltd v National Transport Commission
Corbett
JA held that:
"Naturally, it is for the Court
to decide whether the matter is really one of urgency arid whether
the circumstances warrant
a departure from the normal procedures. To
hold otherwise would, in my view, make the Court the captive of the
Rules. I prefer
the view that the Rules exist for the Court, rather
than the Court for the Rules."
[16]
It would appear from the applicant's founding affidavit that the
launching of the urgent application was brought about as a
result of
Nash repeating the old defamatory material about Mostert. On 16 July
2017 City Press and Fin24 advised Mostert that they
were about to
publish the substance of criminal charges which Nash had laid at the
Randburg Court and the complaint to the Public
Protector by the EFF
which had been orchestrated by Nash.
[17]
On 14 March 2018, Nash addressed a letter to the Deputy Director
General, National Treasury, the letter was copied to Lord
Hein of the
House of Lords and Abel Sithole, Chairman of the Board of the FSB
wherein Nash stated in paragraph 2 of the letter
that:
"The cancer of Mostert within the
FSB has not gone away. All of the consequences flowing from his
direct influencing/instruction
of the Executive of the FSB that I
predicted would escalate if ignored have indeed escalated . . . ."
[18]
In the same letter Nash makes unsubstantiated allegations regarding
the falsification of inspection reports and the commission
of perjury
and further falsely claims that the Supreme Court of Appeal
"in
a damning indictment of FSB I Mostert association"
ordered
that two curators be appointed when' in fact those additional
curators were appointed by agreement between the parties.
[19]
In his supplementary affidavit, Nash repeats the defamatory
statements that Mostert has unlawfully conducted himself and that
he
is involved in corrupt activities and conduct without any facts to
support such statements. This in my view, establishes a basis
for the
belief that further publication of defamatory material is anticipated
such that the application must be determined urgently.
[20]
In these circumstances, I am of the view that the matter was of
sufficient urgency to justify Mostert approaching the court
on the
notice provided for in the notice of motion. The allegations against
Mostert involves an alleged ongoing unlawful conduct
and Nash was not
taken by surprise by the allegations contained in the founding
affidavit. Consequently, the challenge to the urgency
of the
application must fail having regard to the above factors including
the interest of justice.
The
relief sought
[21]
In summary, the applicants (referred collectively as "Mostert")
sought and obtained an order
ex parte
on urgent basis
preventing the respondents from publishing the present application
papers in Part A of the application. In Part
B of the application
Mostert seeks and order that:
21.1 First to third respondents be
interdicted from disseminating, directly or indirectly, false and
defamatory allegations about
the first and first and second
applicants;
21.2
that respondents be directed to
cause the website
http://pensionscam.co.za
or any other website established by them which refer the Mostert be
closed down within 24 hours of being ordered to do so, failing
which
the Sheriff shall be authorised to do so.
21.3 Ordering that the respondents
shall first obtain the leave of the Court as a prerequisite to
instituting any further proceedings
against the applicant
Failure
to comply with the requirement of
ex parte
applications
[22]
Nash assert that there are highly relevant and material facts about
Mostert's misconduct which Mostert has hidden from the
Court and on
this basis he argues the entire application should be dismissed and
the order granted in Part A should should et aside.
The following are
examples of the alleged instances of non-disclosure.
[23]
Nash avers that Mostert has been appointed a curator to 11 Pension
Funds and has concealed an extraordinary commission agreement
signed
between himself and the CEO of the Financial Services Board ("FSB"),
Mr Dube Tshidi. This agreement entitled Mostert
to receive a
percentage of fees averaging 25% of “collections". In
concluding the contingency agreement, Nash alleges
that Mostert and
Tshidi acted unlawfully and committed fraud as the agreement has been
declared unconstitutional in a judgment
of Tuchten J.
[24]
The judgment of Tuchten J was
in fact disclosed in the founding affidavit including the fact that
the said judgment was on appeal
before the Supreme Court of Appeal.
Tuchten J in the judgment reported as
Nash
and Another v Mostert and others
[3]
held that contingency fee
agreements in respect of non-litigious matters were against public
policy. He found that the remuneration
between Mostert and the FSB
was not in accordance with the norms of the attorney's profession and
thus invalid
[4]
.
[25]
Tuchten J did not make a finding that Mostert and Tshidi have
committed fraud as alleged by Nash. Accordingly, Mostert could
not
have been obliged to disclose a fraud that does not exist.
Payment
of FSB expenses
[26]
Nash alleges that Mostert has contracted back with the FSB to pay FSB
their "'expenses" which the FSB incurs in respect
of funds
which Mostert manages. He explains that "having entered into a
highly beneficial contract with the FSB, Mostert then
assures that
the FSB reaps its share of the spoils. There are no facts to
substantiate these bald allegations.
Refund
of states costs
[27]
Nash alleges that the FSB refunded the state's costs to
prosecute him criminally. He alleges that he is aware that the State
has
spent over R30 million on the various FSB trials. He states
further that
"the FSB is a regulator and not authorised to
act as pseudo-prosecutor, yet refuses to disclose the level of
support for the
NPA".
[28]
This allegation is preposterous and is not supported by
any facts. The NPA is prosecuting Nash, and his company, Midmacor,
for their
alleged criminal conduct in removing pension fund monies
from the Sable Fund and Power Pack Funds and the FSB is the
complainant.
The
use by Mostert of his law firm
[29]
Nash assert that Mostert, acting as a curator, routinely appoints his
law firm as attorneys to advise himself as curator and
has charged
excessively high fees to himself as curator. He states that Mostert
continues this by using. his daughter and partner
to set up their
firms and reap further financial benefits.
[30]
Nash does not mention that the order of Classen J dated 21 December
2010 expressly permitted Mostert to appoint his law firm
because of
its peculiar knowledge of the pension funds in question.
[31]
Heaton-Nicholls J considered
this issue in
Executive
Officer of the Financial Services Board (the FSB) v Cadac Pension
Fund; In Re: Executive Officer of the Financial Services
Board v
Cadac Pension Fund and Others
[5]
where the court said:
"It is disturbing that Mostert
litigated in what was described as a lavish scale, using the services
of his law firm, AL Mostert
Inc at the expense of CPF. I am mindful
that paragraph 5.9 of the court order permitted him to do so on the
basis of the firm's
depth of knowledge of the Ghavalas transactions.
While I accept Mostert is the repository of invaluable information
regarding the
CPF and should therefore not be removed as curator at
this late stage, I do not accept that only his law firm can litigate
on his
behalf. Mostert must be capable of transferring his wealth of
knowledge to another law firm in which he has no financial interest.
That his legal firm is best placed to deal with Ghavalas transactions
notwithstanding, the appointment of a law firm in which a
curator has
a direct interest creates the perception that the curator is
benefitting twice, both a curator and as a lawyer. This
practice
should be frowned upon. Accordingly, the rule should not be confirmed
with regard to the use of the services of AL Mostert
Inc.
[32]
In my view, the non-disclosure of a court-mandated law firm does not
constitute suppression of a material fact and would not
influence a
court in the determination of the relief sought in Part A.
Prior
findings in other matters
[33]
The Nash contends that the present application is Mostert
modus
operandi
as it was not the first time that Mostert has litigated
in this manner. He argues that the application should be dismissed on
the
basis that Mostert failed to disclose that in 2007, he brought an
ex parte
application, in his capacity as a curator of various
funds and the judge dismissed the application because the evidence
relied upon
was hearsay. He refers to another judgment by Joffe J
where the judge was critical of the evidence of Mostert as being of
no evidential
value at all.
[34]
The two cases referred to are irrelevant in the determination of the
relief sought in Part A of the application. It is not
clear on what
basis Mostert was obliged to disclose such findings.
[35]
Nash's conduct in this application is typical of his
modus
operandi,
which involves
·making unsubstantiated malicious allegations without .an y
proof. In an application brought by Nash against
the FSB in which
Nash sought, amongst others an order that his criminal trial be held
in camera ("the secrecy application")
Wright J had this, to
say about Nash's conduct
[6]
at para 28:
''The founding affidavit contains
irrelevant and harsh allegations against some of the respondents
which have not been proved..
The first group of respondents are said
to be
"aided and abetted'
by the
"Mostert team".
Mr Mostert is the 12th respondent and the curator or liquidator
of the relevant pension funds. This is an allegation of wrongfulness,
particularly to commit a crime. See the Concise Oxford English
dictionary, 11th edition, revised."
Mr Mostert will
personally and financially benefit from the outcome of the criminal
proceedings and any monies paid to the state".
How this will
occur is not explained. The barb is that Mr Mostert will benefit
unlawfully from doing what he is said to be doing.
Mr Mostert is
accused of being "disingenuous", that is insincere. There
is an allegation that Ms Marks contributed to
inspection reports
which form the basis of the criminal prosecution and that she wrote
certain paragraphs for the state in the
charge sheet. These
allegations are roundly refuted. The FSB and Mostert teams are said
to consist in a cabal which operates against
applicants. This
allegation too is denied in detail but in a restrained manner. Apart
from this observation, the tone of the founding
affidavit is strident
and provocative, and it and its annexes are far too long."
Discussion
[36]
It is trite law that in an
ex
parte
application for
interim relief, failure to reveal material facts and information in
an application where such facts might have influenced
the court in
arriving at a decision to grant relief would .in itself be sufficient
to warrant a dismissal and setting aside of
the order complained of.
See
Schlesinger v
Schlesinger
[7]
.
[37]
In
National Director of
Public Prosecutions v Basson
[8]
Nugent JA· said at
489 H-J:
"Where an order is sought
ex
parte
it is well established that the utmost good faith must be
observed. All material facts must be disclosed which might influence
a
court in coming to its decision, and the withholding or suppression
of material facts, by itself, entitles a court to set aside
an order,
even if the non-disclosure or suppression was not wilful or mala fide
(Schlesinger v Schlesinger
1979 (4) SA 342
(W) at 348E-349B)."
[38]
Margo J in
Cometal-Mometal S
A R L v Corlana Enterprises (Pty) Ltd
[9]
referred to certain factors that could be taken into account by a
court in the exercise of its discretion not to rescind the order
as
follows:
"It seems to me that, among the
factors which the court will take into account in the exercise of its
discretion to grant or
deny relief to a litigant who has breached the
uberrima fides rule, are the extent to which the rule has been
breached, the reasons
for the non-disclosure, the extent to which the
court might have been influenced by proper disclosure in the ex parte
application,
the consequences, from the point of doing justice
between the parties, of denying relief to the applicant on the ex
parte order,
and the interests of innocent third parties, such as
minor children, for whom protection was sought in the ex parte
application."
The
enquiry falls into two parts, namely whether material facts were
undisclosed and, secondly, whether a court should exercise
its
discretion in a particular case to set aside the order granted, one
must take into account what was said in
Schlesinger v Schlesinger
(supra)
at 3508-C, namely:
It appears to me that unless there are
very cogent practical reasons why an order should not be·
rescinded, the Court will
always frown on an order obtained
ex-parte
on incomplete information and will set it aside even if relief
could be obtained on a subsequent application by the same applicant."
[39]
In my view, the alleged instances of non-disclosure are not material
and would not have influenced the outcome of Part A. The
relief
granted in Part A ordered that the matter be heard as one of urgency,
in camera.
Antony
Louis Mostert's situation
[40]
Mostert asserts that the following conduct by Nash has had the effect
of delaying the progression and administration of Pension
Funds and
ultimately to prejudice the former members thereof, all of whom are
of advanced age and may be deceased before the surplus
apportionments
are completed:
40.1.1 Disrupting the progression of
the administration of the Sable Fund, the Power Pack Fund and the
Cadac Fund by bringing the
series of applications aimed at delaying
and derailing civil claims against him and his company, Midmacor.
These include;
40.2 Attempts to delay the
adjudication of the application brought to set aside the section 14
certificate transferring the business
of the Stable Fund to the
Lifecare Fund;
40.3 Seeking to set aside the fees
payable to Mostert and declaring that those fees were not in
accordance with the wording of the
original order placing the Sable
Funds under curatorship - Tuchten judgement;
40.4 Seeking a permanent stay of the
civil and criminal proceedings about the fraud, theft and simulated
transactions in respect
of the Power Pack Fund.
40.5 Seeking to remove Mostert as the
provisional curator of the Cadac Fund, opposing Mostert final
appointment and raising disputes
as to the appointment of the third
curator; this action has resulted in the curatorship of Cadac having
been effectively sterilised
for seven years
40.6 A smear campaign using social
media, website and the media as a platform, to damages Mostert's good
name and reputation which
has amounted to defamation.
Nash's
conduct and its repercussions
[41]
On 22 July 2017 Nash filed an affidavit in a criminal complaint where
he said:
"I act on behalf of myself and a
number of clients who have been witness to the corruption of
officials of the Financial Services
Board ("FSB") and it's
self-appointed curators who are operating a state-sanctioned crime
syndicate specialising in racketeering
and fear.
..... We have recordings of the head
of the FSB, Tshidi and his inspectors and alleged legal advisor, Ms
Stander breaching the legislation
and committing crimes by falsifying
FSB reports to use to take over pension funds and then taking the
money and intimidating the
officers · into submission with
attorney AL Mostert.
In 2005 Attorney Mostert was broke and
heavily in debt, but he made a deal with Tshidi head of the FSB that
as curator of pension
funds he could extort millions from innocent
victims and invest it for himself. ..."
[42]
Despite the appointment of Mostert as a liquidator being confirmed by
the Supreme Court of Appeal after Heaton-Nicholls J,
in a damning
judgment, had dismissed Nash application seeking to remove. Mostert
as a curator of the Cadac Pension Fund, Nash states
in his
supplementary replying affidavit that Mostert has actively
participated in collusive conduct and was the main conspirator
in
having imself (Mostert) appointed as a curator of the Cadac Pension
Fund.
[43]
Nash alleged that Mostert and his team falsified inspection Reports
and committed perjury in filling what they knew to be false
affidavits to plot the curatorship of Cadac Fund.
[44]
Nash concludes his letter of 14 March 2018, addressed to the Deputy
Director General of National Treasury and copied to Lord
Hein of the
House of Lords and Abel Sithole, Chairman of the Board of the FSB by
stating:
" I urge that you, as Board
members, now intervene and get the cancer of the "Mostert
factor'' out of the FSB as clearly
it has lead the FSB organization
corrupt conduct. As previously I tender all evidence (that is not
privileged) that would be required
by any truly independent audit
person to verify the above"
[45]
Nash without any facts to support his allegations, states that
Mostert has done many secret deals with different witnesses
and that
Mostert has a reputation of presenting false and incorrect facts to
suit his position.
[46]
Despite the appointment of two additional curators to the Cadac
Pension Fund by the Supreme Court of Appeal being by agreement,
Nash
falsely claims in the said letter that the Supreme Court of Appeal
"in a damning indictment of FSB I Mostert association"
ordered that two curators be appointed.
[47]
In paragraph 52 of his answering affidavit Nash alleges that Mostert
is guilty of:
"Corruption in that on or between
15 March 2005 and 20 July 2017, Mostert and Tshidi were unlawfully
and intentionally engaged
in a generally corrupt relationship in
terms of which Tshidi used his position as CEO or Executive Manager
of the FSB to ensure
that Mostert would be appointed as the
provisional curator and or final curator of various specified pension
funds....."
[48]
Nash interacted with the EFF, a
political party and provided·it with information that it used
to lodge a complaint with the
Public Protector. Nash continues
publication of the latest website
www.pensionscam.co.za
which claims:
This
website serves to lay bare a highly evolved, cynical, mercenary, yet
simple scheme operated by a curator (Attorney Antony Louis
Mostert)
acting in conjunction and co-operation with senior members of the
Financial Services Board (FSB) with the ultimate objective
of earning
the curator "nauseating" amounts of money in the form of
"Contingency Fees". These illegal contingency
fees are a
self-devised incentive scheme and feed the desire for persecuting
various targeted individuals/companies on the basis
of transactions
undertaken in the 1990's.
[49]
The respondents with Nash as the controlling mind has attacked
Mostert's moral character by suggesting that he is a "drug
user", frequents "brothels" and engages in
prostitution and bribed the FSB officials.
Nash'
defence
[50]
Nash contends that the order sought would constitute a serious
violation of his right to freedom of expression, in at least
two
ways: firstly, it seeks to limit his freedom to impart information
and ideas unjustifiably; and secondly, it unjustifiably
limits the
public's right to receive the information pertaining to Mostert's
unlawful conduct.
The
issues
[51]
To decide the dispute, the court must answer the following questions:
a. Has Nash undermined the right of
Mostert to the safegµard of his dignity and reputation or
fama
which personality right is protected by the law of defamation;
b. Does freedom of expression
exonerate Nash from all liability for his untruthful statements about
Mostert;
c. Is the order sought justified?
[52]
The law of defamation is
designed to protect the reputation of people, in doing so, it limits
the right to freedom of expression.
Such limitation can be consistent
with the Constitution only if it can be said that
'an
appropriate balance is struck between the protection of freedom of
expression on the one hand, and the value of human dignity
on the
other.
See
Hoho
v The State.
[10]
Right
to human dignity
[53]
Human dignity is stated in s 1 of the Constitution to be a
foundational value of our democratic state. Section 10 of the
Constitution
protects the right of every person to dignity: this
right includes "inherent dignity and the right to have their
dignity respected
and protected". In
Dawood
and Another v Minister of Home Affairs and Others,
[11]
the Constitutional Court explained that:
"The value of dignity in our
Constitutional framework cannot ... be doubted. The Constitution
asserts dignity to contradict
our past in which human dignity for
black South Africans was routinely and cruelly denied. It asserts it
too to inform the future,
to invest in our democracy respect for the
intrinsic worth of all human beings. Human dignity, therefore,
informs constitutional
adjudication and interpretation at a range of
levels."
[54]
All rights are
interpreted generously and purposively having regard to the
underlying values of the Constitution. In
Khumalo
and Others v Holomisa
[12]
O'Regan J stated that although freedom of expression· is
fundamental to our democratic society, it is not of paramount value.
It must be construed in the context of the other values enshrined in
our Constitution. In particular, the values of human dignity,
freedom
and equality.
Freedom
of expression
[55]
Section 16 of the Constitution provides as follows:
"(1) Everyone has the right to
freedom of expression, which includes –
(a)
freedom of the press and other media;
(b)
freedom to receive or impart information or ideas;
(c)
freedom of artistic creativity; and
(d)
academic freedom and freedom of scientific research.
(2) The right in subsection (1) does
not extend to –
(a) propaganda for war;
(b) incitement of imminent
violence; or
(c) advocacy of hatred that is
based on race, ethnicity, gender, or religion, and that constitutes
incitement to cause harm."
[56]
The
Constitutional Court in
Islamic
Unity Convention v Independent Broadcasting Authority
[13]
explained that Section 16
is in two parts. Subsection (1) is concerned with the expression that
is protected under the Constitution.
Any ljmitation of this category
of expression must satisfy the requirements of section 36
[14]
to be constitutionally valid. Subsection (2) deals with an expression
that is specifically excluded from the protection of the
right.
[57]
It follows that it must first be determined whether the expression is
one specifically protected under section 16(1) or specifically
excluded under section 16(2); secondly, if the expression is one
which is protected by section 16(1) and not excluded by section
16
(2), the court must then determine whether the purported limitation
complies with the requirements of the general limitation
clause under
the section 36 limitation clause.
[58]
What is required by section 36 of the Constitution was explained by
Nugent A in
Midi Television
(Pty) Ltd v Director of Public Prosecutions (Western Cape)
[15]
thus:
"The party seeking to justify the
limitation of a right (in the case of a publication ban, the party
seeking to limit freedom
of expression) bears the burden of
justifying the limitation. The party claiming under the common law
rule that a publication ban
is necessary to avoid a real and serious
risk to the fairness of the trial is seeking to use the power of the
state to achieve
this objective. A party who uses the power of the
state against others must bear the burden of proving that the use of
state power
is justified in a free and democratic society. Therefore,
the party seeking the ban bears the burden of proving that the
proposed
ban is necessary, in that it relates to an important
objective that cannot be achieved by a reasonably available and
effective
alternative measure, that the proposed ban is as limited
(in scope, time, content, etc.) as possible, and there is a
proportionality
between the salutary and deleterious effects of the
ban. At the same time, the fact that the party seeking the ban may be
attempting
to safeguard a constitutional right must be borne in mind
when determining whether the proportionality test has been
satisfied.'
[59]
The importance of the right to
freedom of expression has often been stressed by our courts. O'Regan
J in
South African National
Defence Union v Minister of Defence and Another
[16]
held:
"... freedom of expression is one
of a "web of mutually supporting rights" in the
Constitution. It is closely related
to freedom of religion, belief
and opinion (section 15), the right to dignity (section 10), as well
as the right to freedom of
association (section 18), the right to
vote and to stand for public office (section 19) and the right to
assembly (section·11).
These rights are taken together protect
the rights of individuals not only individually to form and express
opinions, of whatever
nature, but to establish associations and
groups
of
like-minded people to foster and propagate such
opinions. The rights implicitly recognise the importance, both for a
democratic
society and for individuals personally, of the ability to
form and express opinions, whether individually or collectively, even
where those views are controversial. The corollary of the freedom of
expression and its related rights is tolerance by the society
of
different views. Tolerance, of course, does not require approbation
of a particular view. In essence, it requires the acceptance
of the
public airing of disagreements and the refusal to silence unpopular
views."
[60]
Mokgoro J in
Case
and another v Minister of Safety and Security &
Others
[17]
explained the right to receive information as follows:
"But my freedom of expression is
impoverished indeed if it does not also embrace my right to receive,
hold and consume expressions
transmitted by others. Firstly, my right
to express myself is severely impaired if others' rights to hear my
speech are not protected.
And secondly, my own right to freedom
of-expression includes as a necessary corollary the right to be
exposed to inputs from others
that will inform, condition and
ultimately shape my own expression. Thus, a law which deprives
willing· persons of the right
to be exposed to the expression
of others gravely offends constitutionally protected freedoms both of
the speaker and of the would-be
recipients."
[61]
Mokgoro J emphasized that the right to freedom of expression not be
to be understood in isolation;
". .. but as part of a web of
mutually supporting rights enumerated in the Constitution, including
the right to "freedom
of conscience, religion, thought, belief
and opinion", the right to privacy, and the right to dignity.
Ultimately, all of
these rights together may be conceived as
underpinning an entitlement to participate in an ongoing process of
communicative interaction
that is of both instrumental and intrinsic
value.
[62]
Freedom of expression does not
trump the right to dignity. In
S
v Mamabolo
[18]
the following was said by
the Constitutional Court regarding the relationship between the
rights to dignity and freedom of expression:
"With us, the right to freedom of
expression cannot be said automatically to trump the right to human
dignity. The right to
dignity is at least as worthy of protection as
the right to freedom of expression. How these two rights are to be
balanced, in
principle and in any particular set of circumstances, is
not a question that can or should be addressed here. What is clear
though
and must be stated, is that freedom of expression does not
enjoy superior status in our law."
[63]
It is important to bear in mind that Mostert does not seek an
interdict against the media. Nash is not part of the media and
has no
legal duty or obligation to bring to the attention of the public the
type of allegations he makes about Mostert without
first establishing
whether they are indeed true and correct. The cases dealing with
freedom of expression are distinguishable in
that respect.
[64]
The order sought in the notice
of motion is to prevent the first to fourth respondents from
continuing to publish false and defamatory
statements, which
statements the respondents seek to repeat by among other things,
disseminating such information on the website
www.pensionscam.co.za
and well as repeating such statements to the media.
[65]
The Supreme Court of Appeal in
National Media Ltd and
Others v Bogoshi
[19]
held that:
" .. the publication in the press
of false, defamatory allegations of fact will not be regarded as
unlawful if, upon a consideration
of all the circumstances of the
case, it is found to have been reasonable to publish the particular
facts in the particular way
a at the particular time.
In considering the reasonableness of
the publication account must obviously be taken of the nature, extent
and tone of the allegations.
We know, for instance, that greater
latitude is usually allowed in respect of political discussion
(Pienaar and Another' v Argus Printing and Publishing Co Ltd
1956
(4) SA 310
(W) at 318 C-E), and that the tone in which a newspaper
article is written, or the way in which it is presented, sometimes
provides
additional, and perhaps unnecessary, sting. What will also
figure prominently is the nature of the information on which the
allegations
were based and the reliability of their source, as well
as the steps taken to verify the information? Ultimately there can be
no
justification for the publication of untruths, and members of the
press should not be left with the impression that they have a
licence
to lower the standards of care which must be observed before the
defamatory matter is published in a newspaper." (at
1212G -
1213A)".
[66]
It follows in my view, that in defamation cases the truth of what is
said and the public interest are relevant factors. Also
relevant are
the context in which the statements were made, their reasonableness,
the tone used, the identity of the person who
made the statements and
the identity of the victim. These criteria are also useful, in my
view, when determining whether freedom
of expression justifies the
violations of a person's right to dignity.
[67]
Nash submits in his heads of argument and court that Mostert has
failed to prove the publication of material that is defamatory
of him
and has failed to meet the basic threshold for proving
"publication"
of defamatory statements.
"Publication" means the communication or making known to at
least one person other than the
plaintiff. It may take many forms.
Apart from the obvious forms of speech or print, the injurious
information can also be published
through photographs, sketches,
cartoons or caricatures
[20]
[68]
The elements of the
delict of defamation were restated by the Constitutional Court in
Le
Roux v Dey
[21]
thus - (a) the wrongful and
(b) intentional (c) publication of (d) a defamatory statement(s)
concerning the plaintiff. At paragraph
85 the court said:
"Yet the plaintiff does not have
to establish every one of these elements in order to succeed. All the
plaintiff has to prove
at the outset is the publication of defamatory
matter concerning himself or herself. Once the plaintiff has
accomplished this,
it is presumed that the statement was both
wrongful and intentional. A defendant wishing to avoid liability for
defamation must
then raise a defence which excludes either
wrongfulness or intent. Until recently there was doubt as to the
exact nature of the
onus. However, it is now settled that the onus on
the defendant to rebut one or the other presumption is not only a
duty to adduce
evidence, but a full onus, that is, it must be
discharged on a preponderance of probabilities. A bare denial by the
defendant will
therefore not be enough. Facts must be pleaded and
proved that will be sufficient to establish the defence."
[69]
Once a plaintiff
establishes that a defendant has published a defamatory statement
concerning the plaintiff, it is presumed that
the publication was
both unlawful and intentional
[22]
A defendant wishing to avoid liability for defamation must then raise
a defence which rebuts unlawfulness or intention. The defences
raised
by Mostert to rebut unlawfulness are that the publication was true
and in the public benefit.
[70]
In the counter
application brought by Nash opposing Mostert's final appointment as a
curator Judge Heaton-Nicholls states at para
69 of her judgment
[23]
that Nash had embarked on a smear campaign against Mostert, she found
that:
"As
Mostert delved deeper into the Ghavalas transactions the extent of
Nash's dishonesty became apparent. Nash's counter strategy
was to
claim a corrupt relationship between Mostert and Tshidi. In an email
to Darren Williams of Werksmans, he suggests how public
perception
about him will be transformed and "the press will start to
accuse Mostert and the FSB of corruption". This
will result in
the NPA "losing heart", presumably a reference to the
criminal charges Nash is facing. In relation to
the present matter,
he warns that this trial is "high risk and high publicity".
It has to be the "one large fight
we have. It has to be the
watershed fight."
[71]
Despite the above critical findings by the court, Nash
continues with his vilification campaign against Mostert. He provides
no
proof that the facts on which his statements are based are true.
Nash makes repeated allegations that Mostert is guilty of corruption
and fraud without any basis and in flagrant disregard of
consequences. The allegations cannot be regarded as "in the
public
interest" as they are based on falsehood and distorted
facts. The imputation lowers Mostert in the estimation of ordinary
people straddling all sectors of our society and is outrageously
defamatory.
[72]
Nash's impugned statements were made publicly, in newspaper
articles, website publications as well as through the launch of
spurious
court actions and a 6arefully plotted smear campaign as
found by Heaton-Nichols J. There is no merit in fhe submission that
Mostert
has failed to prove the publication of the defamatory
statements by Nash.
[73]
Nash states in general
terms that the statements are fair comment and in the public
interest. A fair comment made honestly and in
good faith on matters
of public interest can constitute a defence to defamation unless they
are made maliciously. The statement
must be one of comment, not fact,
and in order to be fair, it must be an honest expression of an
opinion on facts which are true
and known to the person to whom the
comment is made. The comment must relate to matters of. public
interest. See
Crawford v
Albu
[24]
.
[74]
The defamatory statements by Nash are not made honestly and in good
faith and are not supported by any evidence. They are retaliation
against Mostert for uncovering Nash's fraud and corruption as
highlighted by the findings of Heaton Nichols J. He imputes
base
and corrupt motives in the circumstances were such imputations is not
warranted by the facts. An ordinary unprejudiced reader
would not
take the statements to be a comment based on facts. Nash defence
based on a fair comment cannot succeed.
Final
relief
[75]
The relief prayed for by the applicants is final in effect. The
applicants must, therefore, establish (a) a clear right, (b)
that
injury is reasonably apprehended; and
.
(c) that no other suitable form of relief is
available
[25]
.
A
clear right on the part of the applicant
[76]
The respondents asserts that
this court is obliged to consider against Mostert's rights, the fact
that the information in question
is· true and for the public
benefit. Also the fact that Mostert's rights must be weighed against
respondent's right to freely
express information that is true and in
the public interest, and the public's right to receive such
information. This sentiment
is reflected by the Supreme Court of
Appeal In
Modiri v Minister
of Safety and Security and Others
[26]
as follows:
"As explained by the
Constitutional Court in
Le Roux v Dey
2011 (3) SA 274
(CC)
para 122, common law grounds of justification play a pivotal role
within the framework of our Constitution. The reason is that
it is
primarily in the province of justification that the common law allows
the courts to strike a proper balance between the often
conflicting
fundamental rights of freedom of expression, including freedom of the
press, on the one hand, and the rights to freedom
of privacy and
dignity, including reputation, on the other. Under the rubric of
truth and public benefit, the balancing act turns
mainly on the
element of public interest or benefit. If a defamatory statement is
found to be substantially untrue, the law does
not regard its
publication as justified. Publication of defamatory matter which is
untrue or only partly true can never be in the
public interest, end
of story. But, the converse does not necessarily hold true. Our law
does not regard the publication of a defamatory
statement as
justified merely because it is true, precisely because the court may,
in its performance of the balancing act, find
that in the particular
circumstances of the case, the freedom of expression is outweighed by
the victim's right to privacy or dignity".
[77]
It is clear that there cannot be a justification for the publication
of untruths. The defamatory statements published by Nash
are
substantially untrue. Despite the judgment of Heaton-Nichols J which
traversed all facts relating to Mostert's curatorship,
and Nash's
unsuccessful' appeal against it, Nash has repeated the false and
defamatory allegations in the supplementary. affidavit.
He states
that Mostert has approached the court with
"unclean hands"
to cover up his corrupt activities in failing to pursue Marks for
repayment of monies stolen from the Cadac Fund without any facts
to
support such statements.
[78]
The respondents argue that the defamatory material about which
applicants complain has already been disseminated and is within
the
public domain and the information that applicants seek to interdict
will not have any further effect on his dignity. I disagree.
The fact
that the defamatory material is· within the public domain does
not entitle Nash to continue disseminating such
material unabated in
flagrant disregard of Mostert's rights.
[79]
Mostert in my view has established a clear right not to have the
defamatory statements which have already been disseminated
not to be
publicized again.
Reasonably
apprehended injury
[80]
The fact that Nash continues to defame Mostert in the answering
affidavit, in the media and through the website
www.pensionscam.co.za
with abandon establishes a well-grounded likelihood that Nash will
continue to defame Mostert in the future unless he is stopped
from
doing so.
No
alternative remedy
[81]
In
Doctors for Life
International v Speaker of the National Assembly & Others
[27]
[2006] ZACC 11
;
2006 (6) SA 416
(CC) at 446 C-E, the Constitutional Court said:
"Where immediate intervention is
called for in order to prevent the violation of the Constitution and
the rule of law, courts
will intervene and grant immediate relief."
[82]
I find in this case that there is no other suitable remedy available
to the applicant other than an interdict. The respondents
have
employed a stratagem on an ongoing basis to malign Mostert. As long
as the respondents continue in their vilification campaign
against
Mostert, there will be a continuing violation of his rights which is
ongoing and persistent. It is difficult to see how
this campaign can
be topped in the future except through an interdict. The court must
intervene to prevent t'he violation of Mostert
and his associate's
constitutional right to dignity.
The
declaratory order that leave of the court be obtained before the
first or fourth respondents institute litigation
[83]
Nash and Midmacor have successfully delayed the progression of
criminal proceedings brought against them arising out of, the
unlawful surplus removal of the Sable and Power Pack Pension Funds
for some seven years. through delaying tactics. They have instigated
a "trial within a trial" in their criminal trial alleging
breach of legal privilege.
[84]
In August 2012 Nash and Midmacor brought an application under case no
31650/12
("the secrecy application")
they complained
of alleged breaches of privilege by Ms Marks. They sought an order
that Ms Marks be ordered to furnish
" masses of privileged
information"
which were alleged to have been provided by
Marks to the FSB inspectors and persons engaged in assisting and
advising Mostert in
the investigation of the affairs of the Sable
Fund, Power Pack and the Cadac Fund.
[85]
They argued that Marks betrayed their confidence and collaborated
with the state, the FSB and Mostert as the curator and liquidator
of
the pension funds. They claimed to require all the documents sought
to enable a meaningful defence to be made in their criminal
trial in
the magistrate's court.
[86]
Wright J dismissed the secrecy application with punitive costs
holding that the trial magistrate is best placed, particularly
during
a trial within a trial to decide the r1ecessary questions of fact
from facts found to be proved. Applications for leave
to appeal and
petitions for leave to appeal were instituted and subsequently
refused. this is indicative of delaying tactics by
spurious
litigation.
[87]
Despite the outcome of the judgment of Wright J, Nash and Midmacor
have brought an application to permanently stay the civil
and
criminal proceedings pending against them and for the "trial
within a trial" to be set aside
("the stay
application").
The application for the stay of civil
proceedings is' premised on the same unidentified alleged breaches of
privilege that Wright
J refused to adjudicate on.
[88]
They also seek to set aside the criminal proceedings on the
allegation that the finding of the magistrate in the criminal
proceedings in the "trial within a trial" will be against
them and is a foregone conclusion. Nash has proceeded to take
part in
his criminal trial despite the permanent stay application pending.
The ulterior motive of seeking to delay and derail the
progression of
these proceedings has succeeded in that the stay application has
resulted in the trial in the civil proceedings
which was set down for
hearing for four weeks commencing on 31 July 2017 not commencing and
being postponed
sine die.
[89]
The FSB brought an application to set aside the section 14
certificates issued for the Sable Fund. Victor J granted the
application
on 25 May 2017, Nash brought an application for leave to
appeal the judgment and as a delaying tactic, failed to timeously
prosecute
the appeal because he knew that the existence of the
section 14 certificates is a bar to the Sable Funds taking steps to
recover
the surplus assets unlawfully removed.
[90]
Using the "new trustees" appointed by him despite the Cadac
Fund being 6nder provisional curatorship, Nash sought
an order by way
of urgency to remove Mostert as provisional curator and opposed his
final appointment. The application was dismissed
by Heaton-Nicholls J
as did the appeal to the Supreme Court of Appeal.
[91]
Nash after that raised a dispute as to the appointment
of a third curator and in 1oing so frustrated the appointment of the
replacement
third curator after the resignation of Mr Norman Klein.
It took five years for Mostert's provisional appointment to be
finalized.
As a result, the curatorship of Cadac has been sterilized
for seven years.
[92]
In my view, the fact that Nash succeed in his
application to have the contingency fee agreement between Mostert and
the FSB declared
invalid ("the Tuchten judgment") is not
the reason why Nash and Midmacor should not be compelled first seek
leave of
this court prior to instituting any further legal
proceedings against the applicants. Nash is dishonest and is
motivated by·
ulterior motives to disrupt the progression of
the administration of the Sable Fund, the Power pack Fund and the
Cadac Fund by
bringing a series of applications aimed at delaying and
derailing civil and criminal against him and Midmacor.
[93]
The Ghavalas scheme has caused severe financial distress to some
pension funds, and an immediate intervention by the court
is called
for in the public interest to ensure that frivolous applications do
not delay the conclusion of civil and criminal proceedings
that have
already been instituted. The relief sought does not constitute a bar
to Nash's access to the courts. Instead, it imposes
a judicial
oversight as the first step in any further proceedings that are to be
instituted by Nash.
[94]
In the result the following order shall issue:
1. First to third respondents, either
themselves or through entities in which they hold interest, are
interdicted from disseminating,
directly or indirectly, false and
defamatory allegations pertaining to the first and second applicants
and any of the first and
second applicants associates or persons
engaged in assisting the second applicant in the administration of
the curatorship of the
third applicant and in the liquidation of the
fourth applicant;
2.
The respondents are directed to
cause the website
http://pensionscam.co.za
or any other website established by them which refer to Mostert or
his associates be closed down within 24 hours of being ordered
to do
so, failing which the Sheriff shall be authorised to do so.
3. The first and fourth respondents
are ordered to first obtain the leave of the Court as a prerequisite
to instituting any further
proceedings against the applicants.
4. The costs of this application are
to be borne by the First to Third respondents jointly and severally.
_______________________
K
E MATOJANE J
JUDGE
OF THE HIGH COURT OF SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
For
the Applicant: Adv Wasserman SC with Adv Quinn
Instructed
by: ASSHETON-SMITH INCORPORATED
For
the defendant: Adv Subel SC with Adv Pudfin-Jones
Instructed
by: IAN LEVITT ATTORNEYS
Date
of hearing: 19 April 2018
Date
of judgment: 14 August 2018
[1]
During 1993, Peter Ghavalas ("Ghavalas") devised a
fraudulent scheme to remove surplus funds form pension funds. The
scheme was marketed to principal employers with control of pension
funds. Pension fund monies were illegally released to the
controlling company of each pension fund. A commission of 30% of the
surplus was paid to Ghavalas and the balance of the surplus
was
illegally channeled to employers who participated in the fraudulent
scheme.(" the Ghavalas scheme")
[2]
Since 1994 various transfers in terms of section 14 of the Pensions
Fund Act 24 of 1956 ("PF Act"), have taken place
between
the implicated funds. Section 14 governs amalgamations and transfers
between funds and other entities, and regulates
the transfer of
assets and liabilities. The transfer must be approved by the FSB.
[3]
2017 (4) SA
[4]
Paragraphs [72] to [ 80]
[5]
(2010/50596) (2013] ZAGPJHC 401 (13 December 2013) at para 89
[6]
Simon Nash and another v The Executive Officer of the Financial
Services Board Case no. 31650/12 South Gauteng unreported
[7]
1979 (4) SA 342
(W) 348C-350C
[8]
2002 (1) SA 419
(SCA) at 489 H-J
[9]
1981 (2) SA 412
(W) at 414E-414H
[10]
(493/05)
[2008] ZASCA 98
(17 September 2008)
[11]
[2000] ZACC 8
;
2000 (3) SA 936
at para 35
[12]
(CCT53/01)
[2002] ZACC 12
;
2002 (5) SA 401
;
2002 (8) BCLR 771
(14
June 2002)
[13]
2002 (4) SA 294
[14]
Section 36(1) provides as follows:
"The rights in the Bill of
Rights may be limited only in terms of law of general application to
the extent that the limitation
is reasonable and justifiable in an
open and democratic society based on human dignity, equality and
freedom, taking into account
all relevant factors, including:
(a) the nature of the right;
(b) the importance of the purpose of
the limitation;
(c) the nature and extent of the
limitation;
(d) the relation between the
limitation and its purpose; and
(e) less restrictive means to achieve
the purpose."
[15]
Midi Television (Pty) Ltd v Director of Public Prosecutions (Western
Cape) (100/06)
[2007] ZASCA 56
;
[2007] 3 All SA 318
(SCA);
2007 (9)
BCLR 958
(SCA) (18 May 2007)
[16]
[1999] ZACC 7
;
1999 (4) SA 469
(CC) para 8
[17]
[1996] ZACC 7
;
1996 (3) SA 617
(CC) para 25
[18]
2001 (3) SA 407
(CC) para 41
[19]
1998 (4) SA 1196 (SCA)
[20]
Le Roux v Dey para 86 supra
[21]
2011 (3) SA 274
at para 84
[22]
Khumalo and Others v Holomisa 2005 (5) SA 401 (CC)
[23]
Executive Officer of the Financial Services Board (the FSB) v Cadac
Pension Fund; In Re: Executive Officer of the Financial Services
Board v Cadac Pension Fund and Others.
[24]
1917 AD 102
at page 114
[25]
Setlogelo v Setlogelo
1914 AD 221
at 227
[26]
2011 (6) SA 370 (SCA); [2012] 1 All SA 154 (SCA)
[27]
[2006] ZACC 11
;
2006 (6) SA 416
(CC) at 446 C-E