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[2022] ZAECQBHC 10
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Du Preez and Another v Hantle Infra Planning (PTY) Ltd and Others (1214/2021) [2022] ZAECQBHC 10 (24 May 2022)
IN
THE HIGH COURT OF SOUTH AFRICA
(EASTERN
CAPE LOCAL DIVISION, GQEBERHA)
Case
No: 1214/2021
In
the matter between:
CAREL FREDERICK
BENJAMIN DU PREEZ
First Applicant
I’ ANDRE
SWANEPOEL
Second Applicant
AND
HANTLE INFRA PLANNING
(PTY) LTD
First
Respondent
ANDRE VAN HEERDEN N
O
Second
Respondent
SUNE SMITH N
O Third
Respondent
RENE BEKKER N
O Fourth
Respondent
THE MASTER OF THE HIGH
COURT
Fifth
Respondent
JUDGMENT
GOOSEN
J:
[1]
The applicants seek leave to appeal against the whole of the
judgment,
dated 14 April 2022, dismissing their application for
relief in Part A of their application. The application is opposed by
the
first respondent, Hantle Infra Planning (Pty) Ltd (hereafter
Hantle Planning) and second and third respondents, the joint
liquidators
(hereafter the liquidators) of Retro Reflective (Pty) Ltd
(hereafter Retro Reflective).
[2]
The applicants rely upon several grounds of appeal. They may, for
ease
of consideration, be grouped under main headings. The first
relates to the degree of emphasis or reliance upon certain
authorities
and/or the failure to consider the effect of judgments in
this division which tend to support the granting of the relief
sought.
These, it was suggested, establish compelling reasons to
grant leave to appeal.
[3]
The second concerns the failure to give due weight to the rights of
the
applicants to challenge a court order obtained in their absence
and which is adverse to their interests. In this respect the finding
that the challenge is speculative; that it is capable of being
prosecuted without access to the original founding papers; and that
the effect of access would undermine or stultify the purpose of the
inquiry, are challenged.
[4]
It is,
however, appropriate to begin first with what was framed as a broad
or overarching basis upon which to grant leave, namely
the importance
of the matter at the level of principle. In terms of s 17 (1) (a)
(ii) of the Superior Court Act
[1]
a court may, in the alternative to finding a reasonable prospect of
success, grant leave if it is of the opinion that –
“
(ii) there
is some other compelling reason why the appeal should be
heard,
including conflicting judgments on the matter under
consideration;”
[5]
Mr Buchanan
SC, for the applicants, submitted that this is such a case. He argued
that the issue at hand concerned access to what
is in essence a
public document – court process – upon which a court
order was obtained which adversely affects the
rights of the
applicants. This, he submitted, required a careful balancing of
rights within the context of fundamental rights of
access to
information guaranteed by the Constitution. It was not a matter in
which the constitutionality of s 417 or s 418 of the
Companies Act
was in issue. In this sense the judgments of
Ferreira
v Levin NO and Others
[2]
and
Bernstein
[3]
were of limited assistance. So too the judgments endorsing the
non-disclosure of material documents used in support of an order
authorizing a s 417 inquiry. Broader questions of principles were at
issue which required consideration by a higher court on appeal.
[6]
Mr Du Toit, for Hantle Planning, submitted that the case raised no
significant
matter of principle and that no compelling reasons exist
for granting leave to appeal on that basis. He argued that the
grounds
upon which leave was sought established no reasonable
prospect of success and that leave should therefore be refused. Mr
Bester,
for the liquidators, endorsed the argument. He submitted, in
addition, that the essential principles are settled. The applicants
had failed to establish a basis for the order they sought, even
assuming that they enjoyed
locus standi
as witnesses, to
challenge the lawfulness of the inquiry. Their challenge was
speculative and could be advanced in the proceedings
envisaged in
Part B of the application. To permit an appeal on the broader
‘interests of justice’ basis would undermine
the purpose
of the inquiry.
[7]
The argument founded on the basis of s 17 (1) (a) (ii) of the
Superior
Court Act relied upon both compelling reasons or
circumstances, and the existence of conflicting judgments. I shall
deal with the
latter contention before addressing the existence of
compelling reasons.
[8]
Mr Buchanan
submitted that the judgment in
Leech
and Others v Farber NO and Others
[4]
to which reference was made in the judgment, is in conflict with the
judgment of Jones J, in this Division, in
Jeeva
and Others v Received of Revenue, Port Elizabeth and Others
[5]
.
[9]
It is
indeed the case that Nugent J (as he then was) in
Leech
[6]
did not support the reasoning adopted by Jones J in
Jeeva
.
There is therefore, at face value, a conflict between the two
judgments. The conflict is, however, of no relevance to the decision
in this matter nor does the conflict establish a compelling reason
why this case ought to be considered by a higher court.
[10]
There are three reasons for coming to this view. Firstly, reference
to
Leech
was made to underscore the point that a
prospective witness does not enjoy an unfettered right of access to
information prior to
interrogation, i.e. even at the stage when their
interests are directly impinged. As stated by Nugent J this would be
entirely
inconsistent with the purpose of the enquiry.
[11]
Secondly, both
Leech
and
Jeeva
concerned
access to information sought by a witness prior to interrogation. The
purpose was to enable witnesses to deal with evidentiary
material
with which they may be challenged at the enquiry. That is not the
case in the present matter.
[12]
In the
Jeeva
matter witnesses who were to be interrogated at an inquiry sought
access to information in the possession of a creditor, the Receiver
of Revenue, who was to lead the interrogation. The application was
brought on the basis of s 23 of the Interim Constitution
[7]
.
The court interpreted s 23 and applied it in the context of such
inquiry. It characterized the inquiry as
quasi
-judicial
administrative action and held that a witness was entitled to the
information by reason of the right of equality.
[13]
The court
reasoned as follows
[8]
:
“
A commission of
inquiry authorised by the Master of Supreme Court and held under the
machinery of the Companies Act is administrative
action against the
applicants which in this case has a material bearing upon their
rights and interests. It is quasi-judicial in
nature. The applicants
are accordingly entitled to administrative action which is lawful,
justifiable and both substantially and
procedurally fair. Because
they must submit to interrogation, they are entitled to prepare
themselves to deal with the subject-matter
of the inquiry. They are
entitled to equality before the law, which, in my view, includes
equal access to the information held
by the interrogator, especially
if the interrogator is directly or indirectly an organ of State. The
inquiry concerns the management
of the companies over a period of
many years. Much of the relevant information which will form the
subject of the interrogation
deals with company affairs going back
over the years. Some of it is contained in documents seized by the
Receiver of Revenue in
1990. The applicants have not had sight of
those documents since then. They cannot be treated fairly and equally
at this interrogation
if they do not have sight of these and other
relevant documents before the hearing. It is correct, as Mr Buchanan
points out, that
it is purely coincidental that the information is in
the hands of a creditor who is also a State official, and that if the
petitioning
creditor had been a private person who has proved a claim
as an ordinary creditor arising out of an ordinary commercial
transaction
the applicants would not have had a constitutional right
of access to the information. But this is not an answer to a claim to
information as of right, once it is established that that right is
guaranteed by the Constitution. An ordinary creditor would not
in any
event have had statutory powers to search for and seize the documents
in the first place.”
[14]
In the
Leech
matter Nugent J made specific reference to the latter portion of the
above dictum, and held
[9]
:
“
Although reference
was made to the right to fair administrative action, it seems from
the passage above that the real grounds upon
which the learned Judge
considered the documents should be disclosed was to ensure equality
between examiner and examinee. I regret
that I am unable to subscribe
to the view that the right to equality requires the examiner and the
examinee to be placed in the
same position.”
[15]
This is the ambit of the conflict in the decisions. It concerns the
ambit of and the application
of the right to equality in the context
of a request for access to information in a s 417 inquiry. This does
not arise in the present
matter.
[16]
It is
apposite to point out that even insofar as a more general ‘equality
of arms’ contention within such inquiries
is concerned, some
doubt has been cast on the approach favoured by Jones J in
Jeeva
.
In
Receiver
of Revenue, Port Elizabeth v Jeeva and Others; Klerck and Others NNO
v Jeeva and Others
[10]
,
which did not relate to the
Jeeva
matter but which dealt with a related application, the Appellate
Division (as it then was) held that a liquidator or creditor does
not, in an inquiry, act in a quasi-judicial capacity vis-à-vis
the examinee.
[11]
Notions of
fairness,
inter
se
, do
not arise. A liquidator or creditor may be biased or adversarial.
[17]
In similar
vein, the premise upon which Jones J proceeded in both the
Jeeva
judgment and in the judgment which was the subject of the appeal
before the Appellate Division, namely that inquiries of this kind
are
Draconian, has not been endorsed.
[12]
It is, however, not necessary to enter the lists on the conflict in
the authorities. It is, as I have said, not relevant in the
present
matter since we are not here dealing with disclosure of information
or evidence in possession of an examiner who is to
confront an
examinee.
[18]
The third reason for finding that no compelling circumstances warrant
consideration of
this matter on appeal concerns the fact that no
general principle is engaged. All of the authorities, referred to in
the main judgment,
indicate that it is within the power of a court to
relax the confidentiality provision or to grant access to information
or documents
upon an application which is properly motivated. This is
so because it falls within the jurisdiction of the High Court to
protect
an examinee from oppression or hardship in such inquiry.
[19]
The decision to do so is one which will be based on in the facts of
the case. The starting
point is that the process of investigation
occurs confidentially and without disclosure. This is fundamentally
required in order
to achieve the objects and purpose of the inquiry.
[20]
The
judgment in
Jeeva
does not establish a general principle (even if in circumstances of
jurisprudential conflict) to different effect. The constitutionality
– and thus the general principles to be applied – of the
inquiry regime is settled.
[13]
There is therefore no compelling reason to have this question
considered afresh.
[21]
Mr Buchanan submitted that the novelty lies therein that the question
of confidentiality
and access to the founding court papers has not
pertinently been considered in the light of the right of access to
information.
Certainly there appears to be no authority directly in
point. Novelty alone, however, would not be a compelling reason to
grant
leave to appeal. It would still be necessary to consider
whether, in the circumstances of this case, there exists a reasonable
prospect that a court of appeal would set aside the order against
which the appeal is prosecuted.
[22]
It is with this in mind that I turn to consider the further grounds
upon which leave to
appeal is sought. It was submitted that the
finding that the applicant’s challenge to the lawfulness of the
order, on the
basis of material non-disclosures, was speculative was
made in error. The applicants concede, however, that, in the absence
of
disclosure of the founding papers, the allegation is necessarily
speculative. I am unable to discern on what basis the finding can
be
said to be made ‘in error’. The averment is based solely
upon the fact that the respondents did not disclose certain
facts in
unrelated litigation against the applicants. That is no basis to
infer that they also failed to disclose a material fact
in the
application for institution of an inquiry pursuant to the liquidation
of Retro Reflective. There is no prospect that another
court would
come to a different conclusion in this regard.
[23]
The applicants further rely upon a failure to give due recognition to
their
locus standi
to challenge an unlawful inquiry and a
finding that the
locus standi
is limited to a right to
challenge
before
the order is granted.
[24]
The question of the applicants’ locus standi and their interest
in challenging the
lawfulness of the order authorizing the inquiry
was closely related to the grounds upon which they sought to advance
that challenge.
It was addressed in some detail in argument and the
judgment deals with the argument. It notes the limited legal interest
accorded
to prospective examinees and the generally recognised right
to challenge an interrogation on the grounds of oppression or undue
hardship. This portion of the judgment, however, concluded as
follows:
“
[28]
In my view, it is doubtful that the applicants enjoy the broad
legal
standing they seek to assert in relation to the setting aside of the
enquiry
in toto.
That, however, is a matter which will no
doubt be considered in the proceedings the applicants intend to
pursue in Part B of the
notice of motion. I accordingly make no
finding in relation thereto.
[29] Assuming that they
are parties who could seek access to the papers, the question remains
whether such access ought to be granted.
In this regard a court will
be guided, in large measure, by the views expressed by the
liquidators.”
[25]
In the light of this I fail to understand on what basis it is said
that undue weight was
attached to the applicants’ standing or
that an adverse finding was made. On the contrary, it was assumed in
favour of the
applicants that their standing presented no impediment
to them pursuing the relief.
[26]
A further ground concerns the approach to views expressed by the
liquidators. It was argued
that undue weight was attached to these
views. A court faced with an application such as this is obliged to
consider the views
of the liquidator and, in particular, to consider
whether the disclosure would stultify the achievement of the objects
or purposes
of the inquiry. In this instance the liquidators were
unequivocal in regard to the effect that disclosure would have. Their
views
were set out in detail in the opposing affidavits.
[27]
It must be borne in mind that a charge of attaching ‘undue
weight’ is, inevitably,
a subjective assessment of degree. The
true question is whether a factor was considered as overriding or
determinative without
regard to other factors. The judgment indicates
that regard was had to various factors and that a balancing exercise
was undertaken.
In these circumstances, I am not persuaded that there
is a reasonable prospect that another court would interfere on the
basis
that it might have weighed the factors differently.
[28]
Taking all of the above into consideration I have come to the
conclusion that leave to
appeal ought to be refused. I therefore make
the following order:
The application for leave
to appeal is dismissed with costs.
G.G.
GOOSEN
JUDGE
OF THE HIGH COURT
Appearances:
Obo
the Applicants
:
Adv R.G. Buchanan SC
Instructed
by
:
RHK Attorneys c/o BLC Attorneys,
Gqeberha
Obo
the 1st Respondent
:
Adv P Du Toit
Instructed
by
: Joubert
Galpin & Searle, Gqeberha
Obo
the 2nd and 3rd Respondents:
Besters Attorneys, Gqeberha
Heard
: 16
May 2022
Delivered
:
24 May 2022
[1]
Act
No. 10 of 2013.
[2]
Ferreira v Levin No and Others; Vryenhoek and Others v Powell NO and
Others
1996 (1) SA 984
(CC).
[3]
Bernstein and Others v Bester and Others NNO 1996 (2) SA 751 (CC).
[4]
2000
(2) SA 444 (W).
[5]
1995
(2) SA 433 (SE).
[6]
Supra
at
453E-H.
[7]
Act
200 of 1993. Section 23 dealt with the right of access to
information.
[8]
Jeeva
(
supra
)
at 443I-444D.
[9]
Leech
(s
upra
)
at 453F-G
[10]
1996
(2) SA 573 (A).
[11]
In
Bernstein (
supra
)
Ackermann J expressed some doubt that an inquiry in terms of s 417
constitutes administrative action
(see para
96 – 97).
[12]
See
Receiver of Revenue, Port Elizabeth at 578.
[13]
See
Ferreira v Levin NO (
supra
)
and Bernstein (
supra
).